With another breakaway Bitcoin fork being targeted for this month, I started thinking less about whether the new chain succeeds and more about what happens mechanically if you hold bitcoin through an ETF.
If you self-custody BTC, a chain split is fundamentally a wallet/private-key problem.
With IBIT or FBTC, you own shares of a trust. The trust controls the bitcoin through its custodians and operates under the rights and procedures in its fund documents.
That creates some questions that don’t come up much in normal ETF comparisons:
- Does the trust recognize the forked asset?
- Does the custodian have to support the new chain?
- Who decides whether the new asset gets retained, sold, abandoned or ignored?
- If it has value, do shareholders receive anything directly?
- What happens if the custodian and sponsor don’t treat the fork the same way?
I’m digging through the IBIT and FBTC disclosures now to see exactly how each one handles forks and incidental rights.
The interesting part to me is that this is one of those scenarios where two funds giving nearly identical spot bitcoin exposure may not necessarily produce identical outcomes at the edges.
I mapped the custody disclosures side by side here if anyone wants the source trail:
submitted by /u/visionanalyticsio
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