BlackRock files for a bitcoin fund that limits losses to about 10%, with capped gains

BlackRock has filed to launch a bitcoin fund built to cushion falls. On October 19, iShares Trust filed a post-effective amendment (form 485APOS) on SEC EDGAR for the iShares Bitcoin Managed Protection ETF, ticker PBIT. It is a proposal. The prospectus is marked as incomplete, the launch date reads "2027" with a blank day, and nothing can be sold until the registration becomes effective.

What the filing says

The stated objective is to give upside exposure to the iShares Bitcoin Trust (IBIT) "and/or similar bitcoin exposure up to an approximate limit, while seeking to provide a level of downside protection." The fund would not hold bitcoin or bitcoin ETPs directly. It would:

• buy call options in three overlapping sets, called tranches;
• sell higher-strike options to help pay for them, which limits gains above the sold strike;
• hold fixed-income investments whose interest income helps offset the option cost.

For each tranche, the filing says the protection start value is typically set at about 90% of the reference asset's value when the options are bought. That gives an initial maximum loss of roughly 10% for that tranche, which the filing calls the "Floor," before fees and expenses.

The fine print behind the 10%

The filing also says the fund has "broad discretion" to raise or lower that start value at any time, so the protection may differ across tranches and over time. It adds that the protection a tranche gives changes after the tranche begins, and that investors may lose some or all of their money.

The upside limit, which the filing calls the Tranche Cap Value, comes from the strike of the options the fund sells. It is set by market conditions when each tranche starts, so no cap number exists yet. The management fee and total expense ratio are blank in the draft table. The cap and the fee decide whether the product is any good, and neither is published.

Why traders are watching

Spot bitcoin ETFs have had a choppy October. Our report on IBIT's $665 million day shows how quickly flows swing. A product that trades some upside for a defined cushion is aimed at holders who want bitcoin exposure but cannot stomach a 50% drawdown. Decrypt also covered the filing on October 20.

Outcomes in buffered funds depend on when you buy relative to a tranche's start. Someone who buys after bitcoin has already fallen or risen inside a tranche gets different protection than the headline 10%. Read the prospectus before the headline.

Sources: SEC EDGAR (iShares Trust 485APOS, filed Oct. 19, 2026); Decrypt. Information, not investment advice.