Bitcoin Whales Move $5 Billion Into BlackRock ETF as Minimum In-Kind Swap Falls to $1 Million

Bitcoin holders have reportedly moved $5 billion into BlackRock’s spot Bitcoin ETF, IBIT, without selling their underlying BTC, according to an update shared by @coinbureau on X. The post also says BlackRock now allows eligible holders to exchange Bitcoin directly for IBIT shares through in-kind transactions starting at $1 million, down from a previous $25 million threshold.

The reported development highlights a growing connection between direct cryptocurrency ownership and traditional financial markets. By enabling certain investors to exchange Bitcoin for ETF shares without first selling the asset for cash, the structure provides a different route for large holders seeking exposure through a regulated investment vehicle.

BlackRock Lowers In-Kind Transaction Threshold

According to the information shared in the update, BlackRock has reduced the minimum size for the reported in-kind Bitcoin-to-IBIT transactions from $25 million to $1 million.

The change significantly lowers the stated threshold for participating in the mechanism. Instead of requiring a transaction of at least $25 million, eligible holders can reportedly use the structure for transactions beginning at $1 million.

An in-kind transaction differs from a conventional ETF creation process involving cash. Rather than selling Bitcoin and using the proceeds to acquire ETF shares, the underlying asset can be delivered directly as part of the transaction.

This structure can be particularly relevant to investors holding substantial amounts of Bitcoin because it provides a mechanism for moving from direct ownership into an exchange-traded investment product without requiring a conventional market sale of the cryptocurrency.

The reported change also illustrates how investment products tied to digital assets are becoming more closely connected with established financial-market infrastructure.

$5 Billion in Bitcoin Reportedly Shifted Into IBIT

The X post states that Bitcoin whales have moved $5 billion into BlackRock’s ETF without selling their Bitcoin for cash.

The figure represents the amount highlighted in the original update and reflects the scale of Bitcoin holdings reportedly entering the ETF through the described mechanism.

IBIT is BlackRock’s spot Bitcoin ETF, providing investors with exposure to Bitcoin through shares traded in traditional financial markets. The product allows investors to gain Bitcoin exposure without directly managing cryptocurrency wallets or holding the asset themselves.

For large Bitcoin holders, moving assets into an ETF can represent a transition from direct cryptocurrency custody to an investment structure operating within traditional market infrastructure.

The reported $5 billion figure therefore illustrates the potential scale of the connection between major Bitcoin holders and the institutional investment market.

Direct Bitcoin-to-ETF Transfers Change the Process

The key feature highlighted in the update is that holders can reportedly move Bitcoin into IBIT without first selling the cryptocurrency.

Under a conventional process, an investor wanting to exchange a Bitcoin position for cash-based financial assets would generally need to sell the cryptocurrency. That sale could create a taxable event depending on the investor’s jurisdiction and individual circumstances.

An in-kind transfer works differently because the investor contributes the underlying asset directly in exchange for shares or another financial interest. The tax treatment of such transactions depends on applicable laws and the specific circumstances of the investor.

As a result, the claim that the transfers occur “without paying a dollar in taxes” should not be interpreted as a universal tax exemption. The original post does not provide details about individual tax circumstances, jurisdictions or the legal treatment applicable to each transaction.

The significance of the reported mechanism instead lies in the ability to transition between direct Bitcoin ownership and ETF exposure without requiring a conventional sale of the cryptocurrency.

Bitcoin and Traditional Finance Become More Closely Connected

The reported changes involving IBIT reflect the continued integration of Bitcoin into traditional financial markets.

Spot Bitcoin ETFs provide a bridge between cryptocurrency markets and established investment infrastructure. Institutional and high-net-worth investors can obtain Bitcoin exposure through exchange-traded products while relying on the custody, trading and reporting structures associated with traditional financial markets.

The reported reduction in the minimum in-kind transaction size from $25 million to $1 million potentially expands access to the mechanism among larger investors.

For Bitcoin holders, the ability to exchange the asset directly for ETF shares represents an alternative to selling Bitcoin on the open market. For the traditional financial sector, it further connects Bitcoin liquidity with ETF infrastructure.

The reported $5 billion in transfers also underscores the scale of capital involved in the relationship between Bitcoin holders and institutional investment products.

As BlackRock’s IBIT continues to serve as a major vehicle for Bitcoin exposure, developments surrounding its structure are likely to remain relevant to both cryptocurrency and traditional financial-market participants.

Writer: Victoria Hale
Technology & Blockchain Writer

Victoria Hale writes about blockchain technology, digital infrastructure, and the intersection of emerging technologies with finance. Her articles explore how new protocols and systems are shaping the evolving digital economy.

She prioritises clarity and accuracy when explaining technical developments to a general audience.