- Goldman Sachs filed for a Bitcoin Premium Income ETF at the SEC on Tuesday.
- The product offers exposure to BTC with limited volatility.
Fresh from the launch of Morgan Stanley Bitcoin Trust ETP (MSBT), another traditional financial institution has entered the Bitcoin (BTC) exchange-traded fund (ETF) race. On Tuesday, Goldman Sachs registered for the Goldman Sachs Bitcoin Premium Income ETF.
Goldman Sachs Bitcoin Premium Income ETF
According to the company’s filing at the US Securities and Exchange Commission (SEC), the fund’s objective is to “seek current income while maintaining prospects for capital appreciation.” It would also invest at least 80% of its net assets, including borrowings, in investments that provide exposure to BTC. These include spot Bitcoin exchange-traded product (ETP), options on spot Bitcoin ETPs, and options on Bitcoin ETP indices.
Goldman Sachs clarified that the new investment product will not invest directly in Bitcoin. Instead, it will generate income by selling call options on Bitcoin ETPs at a premium. This means the fund will employ a covered call strategy. It trades some of BTC’s potential gains for immediate cash flow. By writing call options, it collects premiums from buyers who are betting on the premier crypto asset’s price increase, but with a cap on the fund’s upside gains if prices rise steeply.
As the ETF’s name implies, its design trades only part of the upside for yield. The feature makes it ideal for clients who want exposure to BTC with lower volatility.
Eric Balchunas, Senior ETF Analyst for Bloomberg, found the filing surprising. Meanwhile, he praised Goldman Sachs for structuring the product through a Cayman subsidiary to circumvent regulatory limits on direct commodity holdings. Additionally, he referred to the ETF as a “Boomer Candy” for its low volatility.
Bitcoin ETF Performance
After another huge sell-off on Monday, which showed a $291 million net outflow, spot Bitcoin ETFs in the US saw significant momentum on Tuesday, closing with a $411.4 million net inflow, according to Farside Investors data.
To date, Bitcoin ETFs in the US have accumulated $56.887 billion in total net inflows. The largest contributor to the flow is BlackRock’s iShares Bitcoin Trust ETF, with $63.975 billion in net inflows since its launch in January 2024. Dragging the overall figures, though, is the continuous sell-off in the converted Grayscale Bitcoin Trust ETF (GBTC), which has already reached $26.115 billion in net outflows.
The newest entrant in the pack is Morgan Stanley’s MSBT, with $84 million in net inflows so far.
