BlackRock Lowers Bitcoin ETF Swap Minimum to $1 Million, Report Says

BlackRock has significantly reduced the minimum amount of Bitcoin required for direct swaps into its IBIT exchange traded fund, cutting the threshold from $25 million to just $1 million, according to Bloomberg report. Rival issuer Bitwise has made a similar move, lowering its minimum from $100 million to $3 million.

In-Kind Swaps Allow Tax-Efficient Transfers

These transactions work through a process called in kind creation, where investors exchange their Bitcoin directly for ETF shares without triggering a taxable sale. This approach helps large holders avoid capital gains taxes while shifting from self-custody to regulated fund structures. BlackRock’s IBIT has already processed more than $5 billion in such swaps, up sharply from $3 billion in October.

Security Concerns Driving the Shift

According to BlackRock’s head of digital assets, growing concerns around crypto related kidnappings, hacks, and custody failures are pushing more holders to move some or all of their Bitcoin into ETFs for added security. The trend isn’t limited to Bitcoin, with issuers like Grayscale and VanEck now offering similar in-kind swap options for Ether as well.