The minimum size for exchanging bitcoin directly for shares in BlackRock's iShares Bitcoin Trust (IBIT) has been reduced from $25mn to roughly $1mn, the firm's head of digital assets, Robert Mitchnick, said on Bloomberg Television on 10 Aug. He attributed the reduction to authorized participants agreeing to process smaller orders.
Blackrock Lowers Threshold for In-Kind IBIT Creations to $1mn
11 August 2026 - 12:32 UTC
By Isabelle Castro
The change brings in-kind conversion within reach of family offices and individual large holders a week after an exploit resulted in more than $130mn in Bitcoin being drained from Coldcard hardware wallets.
Opening access
Speaking to Bloomberg’s Eric Balchunas and Isabelle Lee, Mitchnick said in-kind creations still account for a small share of the fund's activity. However, since the SEC voted to permit the activity in July 2025, he said the share had grown.
He expected activity from intermediaries to reduce the minimum size to also have a positive impact. “Hopefully, one day, it'll be accessible at any size."
Asked why the threshold had been so high, Mitchnick pointed to operational cost. "There's some manualness to the transaction that needs to be undertaken, and so it's about what providers are willing to support just to make the math and the administrative process work."
Two areas of attraction
Balchunas asked Mitchnick about tax treatment for bitcoin holders turning to IBIT shares, framing the exchange as a transaction to avoid taxes. While Mitchnick replied with a simple "Yeah" without expanding, IBIT's registration statement says that the contribution should not be a taxable event, with cost basis and holding period carrying over. However, the treatment depends on the bitcoin reaching the trust in exchange for a pro rata interest.
The recent Coldcard exploit has also caused some to speculate that ETFs could be a point of attraction to long term Bitcoin holders. Hard wallets, separated from the internet, had been regarded as a point of safety for holders, insulated from cybersecurity breaches. In the week following the Coldcard hack, both Bitcoin ETFs and exchanges recorded a spike of inflows, making it the strongest week for ETF inflows since April.
The trend for ETF inflows has since reversed in part, with spot bitcoin ETFs recording net outflows of $145mn on 10 Aug, according to Coinglass, ending a five-session run of inflows. IBIT accounted for the largest share, registering $54mn in outflows.
Bitcoin absorbed the reversal with little movement. The asset traded near $65,000 through 10 Aug before slipping to just over $64,000, having been range-bound at that level for several weeks.
