BlackRock reduced by 96% the minimum amount required for BTC in-kind conversions, dropping from $25 million to $1 million, thereby expanding access to its iShares Bitcoin Trust (IBIT) ETF. The issuer recorded $5 billion in in-kind conversions, swapping physical BTC for ETF shares, signaling a massive migration toward third-party custody. Robbie Mitchnick, head of digital assets at BlackRock, attributed this trend to recent custody failures, notably the Coldcard vulnerability, and the rise in physical attacks targeting cryptocurrency investors. Following the Coldcard incident, over 210,000 BTC, worth more than $13 billion, were moved between long-term holder wallets, a movement interpreted as a custody migration rather than capitulation. In August alone, IBIT attracted $200 million in weekly average inflows, representing half of the total weekly net flows of approximately $500 million.
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