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Bitcoin had a rough stretch over the past year… and then suddenly ripped higher again. That got me thinking: is now the time to add more Bitcoin income exposure? And more importantly… is BTCI still the best way to do that?
When I first bought BTCI, the yield was around 26%. Today, the yield is still extremely high, but the share price has fallen significantly since launch. That combination of high income and price volatility makes BTCI difficult to judge using price alone.
That’s why total return matters.
Distribution History
Most NEOS funds pay relatively stable monthly distributions. BTCI is different because the underlying asset — Bitcoin — is far more volatile than the S&P 500.
Since BTCI launched in October 2024, the distributions have broadly followed Bitcoin’s price trend: strong rallies followed by sharp corrections. The latest payout came in just under $0.80 per share.
If you bought BTCI near launch around $50 per share, your current yield-on-cost would still be roughly 19%. That’s after a difficult year for Bitcoin prices.
And there’s an important point here: covered call funds like BTCI generate income based on the value and volatility of the underlying asset. If Bitcoin rallies again, the distributions could rise with it.
Total Return Matters
High yield alone doesn’t tell the full story.
Covered call funds generate income by selling call options, which means giving up some future upside in exchange for cash today. Normally, that tradeoff becomes obvious during strong bull markets.
But BTCI has actually stayed surprisingly close to Bitcoin’s total return since inception.
The gap between BTCI and Bitcoin has been less than 1% for much of the period. That’s much tighter than I expected for a covered call strategy tied to such a volatile asset.
The reason is that covered call funds often hold up better during corrections. When Bitcoin falls sharply, there’s less upside being “given away,” while the option premiums continue generating income.
Competition
The biggest question for Bitcoin income investors is whether BTCI remains the best option.
Several competitors now exist, including BITO and newer Bitcoin covered call funds. Some prioritize higher upside participation, while others focus on maximizing current yield.
For me, the key metric remains total return.
If a covered call fund massively underperforms Bitcoin during rallies, the income may not justify the tradeoff. So far, BTCI has held up better than expected.
That said, this remains a highly volatile asset class. BTCI is not a substitute for conservative income investing.
My Take
I don’t view Bitcoin as a core retirement holding. But I do think there’s room in a diversified income portfolio for assets that behave differently from traditional stocks and bonds.
BTCI checks that box.
The income is substantial, the monthly payouts remain attractive, and the total return has been better than I expected relative to Bitcoin itself.
As long as BTCI continues generating at least high single-digit income over time, I plan to keep holding it.
To learn more, click here for the full Review.
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