Bitcoin’s biggest holders are moving a growing amount of their self‑custodied coins into BlackRock’s iShares Bitcoin Trust (IBIT), according to the firm’s head of digital assets, Robbie Mitchnick. The shift, which is occurring at the highest level ever recorded, is being driven primarily by concerns over physical attacks, kidnappings and recent exchange hacks, the Bloomberg‑cited executive said.

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Security‑Driven In‑Kind Conversions

Mitchnick told Barron’s that the “single largest” reason clients cite for the swap is security and peace of mind. The process involves delivering Bitcoin to the fund through intermediaries such as Galaxy Digital, Talos and Virtu, which then issue newly created IBIT shares without a cash sale. Because the conversion is in‑kind, the transaction does not immediately trigger capital‑gains taxes for most investors, a point highlighted by Bloomberg.

Scale and Recent Flow Numbers

BlackRock reported that the value of in‑kind swaps reached $3.6 billion in the most recent week, though the firm acknowledges the true figure could be higher as it does not process every conversion directly. In August, Mitchnick told Bloomberg that IBIT had facilitated more than $5 billion of such swaps, up from over $3 billion in October 2025. As of Nov. 6, the fund held 795,921 BTC, valued at roughly $60.4 billion.

Broader Context and Implications

The surge in IBIT inflows coincides with a broader decline in cash‑based spot Bitcoin ETF assets, which lost about $1.28 billion in the week ending Nov. 6, according to Farside Investors data. French authorities have recorded 77 crypto‑related kidnappings and extortion cases in 2026, surpassing the total for the previous year, while the U.S. has seen plots targeting families for Bitcoin. These incidents underscore why large holders are favoring institutional custody over private‑key ownership, even as the move runs counter to Bitcoin’s original ethos of bank‑free self‑sovereignty.

What to Watch Next

Analysts will monitor whether the SEC’s 2025 rule allowing in‑kind creation and redemption for spot Bitcoin funds continues to boost institutional demand, and whether other asset managers introduce similar products. Additionally, the evolution of physical‑security threats and any regulatory response to custodial concentration could shape the next wave of Bitcoin holder behavior.