BlackRock has cut the minimum transaction size for converting Bitcoin directly into shares of the iShares Bitcoin Trust (IBIT) from $25 million to $1 million — a 25-fold reduction — as the firm seeks to broaden access to its spot Bitcoin ETF, the largest of its kind by assets under management.

Robert Mitchnick, BlackRock's Head of Digital Assets, disclosed the change during an interview with Bloomberg analyst Eric Balchunas. Mitchnick said the firm intends to lower the threshold further over time, with a long-term goal of making the in-kind conversion mechanism available for transactions of any size. The reduction significantly expands the universe of institutional participants — such as smaller hedge funds, family offices, and registered investment advisors — that can utilize the direct BTC-to-share pipeline rather than selling Bitcoin on the open market and redeploying cash.

Conversion Mechanism Details

The in-kind creation and redemption process for IBIT remains intermediated, meaning BlackRock does not directly facilitate transactions with individual investors. Mitchnick noted that in-kind transactions still account for a minority of activity across the broader Bitcoin ETF market, with most inflows continuing to come through new cash investments.

However, since regulators approved the in-kind mechanism, BTC-to-IBIT conversions have increased, prompting BlackRock to reduce the minimum transaction size. The firm expects the lower threshold to attract a wider range of investors and support stronger capital flows into the fund. In-kind conversions are generally viewed as more tax- and cost-efficient than cash-based creations, as they allow holders to move Bitcoin exposure into an ETF wrapper without triggering a taxable sale event.

Investor Sentiment Remains Steady, Mitchnick Says

Mitchnick addressed what he described as a notable shift in perception around Bitcoin. He acknowledged that Bitcoin has gone through five major boom-and-bust cycles and remains a highly volatile asset, but said each cycle has ultimately ended at a higher level than the previous one.

He also pointed to Bitcoin's recent decoupling from equities as a potentially positive development for its diversification thesis.

"We've seen sentiment turn in a noticeable but subtle way the last month or so. You've seen Bitcoin decouple from equities starting earlier in the year," Mitchnick said.

While Bitcoin's price has declined from its October all-time highs, Mitchnick said there is no evidence of widespread panic among investors. "The ETF investor base tends to be more of a fundamental long-term buy and hold type segment," he said.

U.S. Spot Bitcoin ETFs Record $144 Million in Net Outflows

After five consecutive sessions of net positive flows, U.S. spot Bitcoin ETFs recorded $144 million in net outflows on Monday, August 10.

BlackRock's IBIT posted the largest single-fund outflow at $53.60 million, equivalent to approximately 839 BTC. IBIT also recorded $1.5 billion in trading volume. Grayscale's GBTC saw $52 million in outflows, Fidelity's FBTC recorded $40.30 million in outflows, Bitwise's BITB had $28.40 million in withdrawals, and Franklin's EZBC lost $7.40 million.

The Grayscale Bitcoin Mini Trust was the only fund among those reporting activity to register a net inflow, attracting $37.10 million. The broader outflow session came amid a period of heightened macroeconomic uncertainty, though single-day flows have historically shown limited correlation with longer-term ETF adoption trends.