BlackRock cuts bitcoin ETF in-kind swap minimum to $1 million: report

The same report said Bitwise has cut its comparable threshold from $100 million to $3 million. It cited Robbie Mitchnick, BlackRock's head of digital assets, saying IBIT had processed more than $5 billion of these swaps, up from $3 billion in October. Those figures and thresholds are reported disclosures, not a public record of every investor or wallet involved.

How the swap works

In an in-kind creation, an authorized participant delivers bitcoin to the fund and receives ETF shares. The SEC's July 2025 approval permits bitcoin and ether exchange-traded products to create and redeem shares this way, describing the process as a potential efficiency and cost-saving measure. The mechanism runs through authorized participants and the fund's custody and settlement arrangements; it is not a retail wallet feature.

For a holder, the attraction is that the bitcoin can move into a listed product without first being sold for dollars, which may avoid an immediate taxable sale in some circumstances. Tax treatment depends on the investor's facts and jurisdiction and should not be inferred from the conversion itself.

A custody shift, not proof of a mass migration

The lower thresholds are a product-access change: they reduce the size of the position needed to use a fund's in-kind channel. They do not show how many bitcoin holders have moved from self-custody, whether the transfers were new investment or internal restructuring, or whether the change will alter market prices.

The supportable conclusion is narrower. ETF issuers are making a regulated custody wrapper easier for large holders to access, while self-custody continues to offer direct control rather than a claim on a fund. The next useful evidence would be issuer-level reporting that separates in-kind creations from other IBIT activity and identifies whether the lower minimum changes volumes beyond the existing flow.