- BlackRock lowered IBIT’s in-kind Bitcoin conversion threshold from $25 million to $1 million for eligible investors.
- Authorized participants handle Bitcoin-to-IBIT conversions, while BlackRock aims to remove the minimum entirely over time.
- IBIT led recent Bitcoin ETF inflows with $693.5 million, outpacing Fidelity’s FBTC during the reported period.
BlackRock has cut the minimum Bitcoin needed for in-kind IBIT conversions from $25 million to $1 million. The change lets eligible investors exchange Bitcoin for IBIT shares through authorized participants, while digital-assets chief Robbie Mitchnick said BlackRock wants to lower the threshold further.
BlackRock Cuts IBIT Conversion Threshold
Bloomberg ETF analyst Eric Balchunas reported the change after speaking with Mitchnick. The new $1 million minimum replaces the previous $25 million requirement for in-kind Bitcoin conversions.
However, individual investors do not transact directly with BlackRock through the process. Authorized participants handle conversions between Bitcoin and IBIT shares. Mitchnick said in-kind creations and redemptions remain a minority of Bitcoin ETF activity.
Most inflows arrive as new dollars, although in-kind activity has grown since regulators allowed the mechanism. According to Mitchnick, BlackRock ultimately wants in-kind conversions available without a minimum transaction size. That would remove the current $1 million threshold.
Coldcard Hack Raises Custody Questions
Mitchnick also discussed the recent Coldcard wallet hack during the Bloomberg interview. He described the incident as a security failure rather than a Bitcoin network breach. He said the vulnerability resulted from an error and called wallet or service breaches individual security management issues.
Meanwhile, he said Bitcoin ETFs offer exposure without requiring investors to manage private keys. Mitchnick also said BlackRock has not seen widespread panic among ETF investors during Bitcoin’s decline. He described the ETF investor base as focused on long-term holding.
IBIT Leads Recent Bitcoin ETF Inflows
Bitcoin ETFs recorded about $1 billion in weekly inflows, according to the supplied data. Farside data showed roughly $865 million entered U.S. spot Bitcoin funds. IBIT received $693.5 million, while Fidelity’s FBTC attracted $116.5 million during the period.
The figures placed IBIT ahead of the other funds listed in the supplied data. Mitchnick also discussed BITA, BlackRock’s Bitcoin premium-income ETF. The product targets mid-to-high-teens yield and reduced volatility, although he expects slower growth than IBIT.
He also noted Bitcoin has passed through five major boom-and-bust cycles. Additionally, he pointed to its recent separation from equities when discussing diversification.
