Fund profiles

IBIT — the iShares Bitcoin Trust ETF

BlackRock's spot Bitcoin ETF holds about $60 billion. A full profile: the 0.25% fee, dual custody, the 0.02% spread, its options market, and what its dominance means.

IBIT is the fund that made this category. It holds roughly $60.0 billion — about four times the third-largest spot Bitcoin fund — trades tens of millions of shares a day, and along with Fidelity's FBTC absorbed 83% of new spot Bitcoin ETF inflows in the first quarter of 2026.

It is also not the cheapest fund in its own category, which makes it a useful case study in why cost is not the only variable that matters.

The key facts

Why liquidity is the whole story

IBIT trades over 52 million shares on an average 30-day basis with a median bid-ask spread around 0.02% — the tightest in the category. ARKB, a perfectly respectable fund with a lower sponsor fee, has been quoted nearer 0.05%.

That difference decides who should own which fund. Cross a spread 0.03 percentage points wider twenty-four times a year and you have paid 0.72% — comfortably more than the 0.11 percentage point fee saving available by moving to a cheaper fund. Cross it twice in a decade and the fee wins instead.

Liquidity is also self-reinforcing, which is why the gap has widened rather than closed. Tighter spreads attract volume; volume supports more market makers; more market makers tighten spreads. Two and a half years after a simultaneous launch designed to prevent a first-mover advantage, IBIT has one anyway. The full framework for weighing this is in how to choose a Bitcoin ETF.

The fee, and the waiver that expired

IBIT's prospectus states a 0.25% sponsor fee. You will still find sources quoting 0.12%, and that figure was real — BlackRock ran a promotional waiver of 0.12% on the fund's first $5 billion for its first twelve months. It has expired. The standing fee is 0.25%.

Against the current market that is mid-range: Morgan Stanley's MSBT charges 0.14%, Grayscale's Mini Trust 0.15%, and several funds sit at 0.19% to 0.21%. On a flat $10,000 position over ten years, 0.25% costs roughly $265 in fees against about $149 at 0.14% — a difference of $116.

Two custodians, which is unusual

Nine of the twelve US spot Bitcoin ETP arrangements involve Coinbase Custody. IBIT is one of the few that does not rely on it alone: BlackRock added Anchorage Digital Bank, a federally chartered digital asset bank, alongside Coinbase Custody Trust Company.

That matters if custodian concentration is on your risk list. Assets are held in segregated accounts in the trust's name rather than on a custodian's balance sheet, but a genuine failure would mean legal process and delay rather than instant access. Splitting across two chartered institutions reduces the exposure to any single one.

It is a different answer from Fidelity's, which self-custodies FBTC inside its own corporate group — removing an external counterparty while creating an affiliated relationship. Neither is obviously better; both are deliberate. Full discussion in custody explained and the FBTC profile.

The options market, and what it enables

IBIT has the only genuinely deep listed options market among spot Bitcoin funds, and for some investors that alone justifies the fee difference.

It makes three things practical. Covered calls generate income against a long position — the only way to produce cash flow from bitcoin exposure, since bitcoin cannot be staked. Protective puts provide genuine downside protection, which matters more here than in most asset classes because stop-loss orders behave badly on a fund whose underlying trades 24/7 (see limit orders and execution). And defined-risk bearish positions let you express a negative view without borrowing shares — covered in how to short a Bitcoin ETF.

Concentration, in both directions

IBIT holding close to half of US spot Bitcoin ETF assets is a genuine consideration and it is usually discussed one-sidedly.

The concern: one fund, one sponsor and largely one dominant custodian sit beneath an enormous share of US regulated bitcoin exposure. Any operational, governance or custody disruption there would touch a great deal of capital simultaneously.

The counterweight: that same scale is what produces the tightest spreads, the deepest options market, the widest authorised participant network and the most reliable arbitrage. Concentration and quality are not separate facts here — they are the same fact seen from two sides.

Our own view is that this belongs on the risk list rather than being dropped from it, and that it is not a reason to avoid the fund. It is a reason not to hold your entire bitcoin exposure in one wrapper. See crypto ETF risks.

Who should own IBIT

Good fit: anyone who trades or rebalances with any regularity, anyone placing a large position where depth matters, anyone who wants options on their bitcoin exposure, and anyone who specifically wants diversified third-party custody.

Weaker fit: a pure buy-and-hold investor in a taxable account with no interest in options, for whom MSBT at 0.14% or the Grayscale Mini Trust at 0.15% delivers the same exposure for less. And anyone who wants to hold the asset itself, which no fund provides.