PANews, June 21 – 10x Research analysis points out that BlackRock’s Bitcoin income-enhanced exchange-traded fund BITA may have a flawed strategy design. Its approach of generating income by selling call options could cause investors to underperform spot Bitcoin in most market environments, potentially failing to deliver the desired absolute returns.

10x Research believes that BITA executes a monthly covered call strategy based on fixed rules. Whether Bitcoin rises, trades sideways, or falls, investors may face unfavorable trade-offs between income and upside potential. The framework it proposes emphasizes “timing and conditional execution,” capturing option premiums only when market conditions are favorable. Bitcoin’s high volatility primarily stems from information asymmetry among market participants and a highly marketing-driven market environment. For a long time, many investors have attempted to capture this volatility premium through systematic strategies, but most have been unable to succeed.