The world of crypto-linked equities is evolving rapidly, and Bitwise Asset Management has stepped forward with a dynamic new approach to income generation. The firm has launched a suite of three actively managed exchange-traded funds (ETFs)—IMST, ICOI, and IMRA—designed to harness the high volatility of leading digital asset companies through a sophisticated covered call strategy.
These funds aim to deliver monthly income while maintaining meaningful exposure to the price performance of MicroStrategy (MSTR), Coinbase (COIN), and MARA Holdings (MARA). Unlike passive income strategies, Bitwise employs daily active management to adjust options positions based on real-time market dynamics, including sentiment, pricing inefficiencies, and macro developments.
How the Covered Call Strategy Works
Covered call strategies involve holding exposure to an underlying asset while selling call options against it. By doing so, the fund collects premiums—providing regular income—while still participating in stock appreciation up to a certain point. However, gains beyond the strike price of the sold option are capped.
What sets Bitwise’s approach apart is its active management model. Rather than mechanically rolling out-of-the-money calls each month, the portfolio team led by Jeff Park, Head of Alpha Strategies at Bitwise, makes tactical decisions daily. This includes adjusting strike prices, expiration dates, and option volumes based on:
- Real-time volatility trends
- Regulatory news impacting crypto stocks
- On-chain and market sentiment data
- Derivatives market structure
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This nimble approach allows the funds to respond quickly to shifts in investor behavior or macroeconomic signals—critical in a space as fast-moving as crypto equities.
Leadership and Investment Philosophy
Jeff Park brings deep institutional expertise to the strategy, having previously held roles at Morgan Stanley, Harvard Management Company, and Corbin Capital. His background in derivatives trading and risk management informs Bitwise’s disciplined execution framework.
“The high volatility of stocks like MSTR, COIN, and MARA creates compelling opportunities to generate income,” said Park. “But it’s essential to be constantly monitoring news, capital flows, regulatory developments, options pricing, market sentiment, and other dynamics to most intelligently capitalize on this strategy.”
The team focuses on balancing income generation with upside participation, seeking to optimize the trade-off between premium collection and equity exposure. Their goal is not just yield for yield’s sake—but sustainable, risk-aware returns in volatile markets.
Fund Details and Expenses
Each ETF operates with a net expense ratio of 0.98%, making them competitively priced within the active options ETF landscape. For ICOI and IMST, the gross expense ratio is 0.99%, with a fee waiver in place through March 25, 2027.
All three funds distribute income monthly, catering to investors seeking predictable cash flow. Importantly, these are non-diversified funds, meaning they concentrate exposure in derivative instruments tied to a single underlying stock.
Core Holdings Focus
- ICOI: Tied to Coinbase (COIN)
- IMRA: Linked to MARA Holdings (MARA)
- IMST: Based on MicroStrategy (MSTR)
While the funds do not own shares directly in these companies, they gain synthetic exposure via options contracts—allowing flexibility and tax efficiency.
Why Crypto Equities Offer Unique Income Potential
Crypto-native public companies exhibit distinct characteristics that make them ideal candidates for income strategies:
- High beta and volatility: Frequent price swings increase option premiums.
- Event-driven catalysts: Regulatory news, ETF approvals, halvings, and macro shifts create pricing dislocations.
- Digital asset exposure: These firms hold significant bitcoin reserves, linking their valuations directly to BTC performance.
As Bitwise CEO Hunter Horsley noted:
“Crypto is well known historically both for its performance and its high volatility. That volatility presents a unique opportunity to generate income.”
By monetizing this volatility through options, investors can potentially earn consistent returns even in sideways or moderately bullish markets.
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Key Risks Investors Should Understand
While the income potential is attractive, investors must be aware of several important risks:
Covered Call Strategy Risk
Selling call options caps upside potential. If the underlying stock surges past the strike price, gains are limited to the premium plus appreciation up to that level.
Synthetic Exposure Risk
The funds use derivatives to simulate stock exposure rather than owning shares outright. This may lead to tracking differences or imperfect replication of price movements.
Digital Assets & Regulatory Risk
Since COIN, MARA, and MSTR have substantial bitcoin holdings, they are exposed to crypto-specific risks—including fraud, hacking, regulatory crackdowns, and exchange failures. Any adverse event in the digital asset ecosystem could impact stock prices.
Concentration and Non-Diversification Risk
With focused exposure to one company per fund, poor performance or negative news affecting that single issuer can significantly impact returns.
Derivatives and Options Risk
Options pricing is complex and sensitive to volatility expectations (implied volatility), time decay, and interest rates. Incorrect forecasts by portfolio managers could reduce income or amplify losses.
Who Should Consider These Funds?
These ETFs may appeal to:
- Income-focused investors comfortable with capped equity upside
- Traders seeking alternative ways to gain exposure to crypto equities
- Portfolio managers looking for yield enhancement tools in volatile markets
They are not ideal for long-term buy-and-hold investors who expect massive uncapped gains from MSTR or COIN.
Frequently Asked Questions (FAQ)
Q: Do these funds pay dividends from MSTR, COIN, or MARA?
A: No. The funds do not hold shares directly and therefore do not receive dividends from the underlying companies.
Q: How is exposure to the stock achieved if no shares are owned?
A: The funds use a synthetic approach via options contracts to replicate the price return of the underlying stock.
Q: What happens if the stock price drops sharply?
A: The fund will experience losses similar to direct stock ownership, though collected premiums may partially offset declines.
Q: Are these funds suitable for retirement accounts?
A: Yes, they can be held in IRAs or other tax-advantaged accounts, but consult a tax advisor due to complex options taxation rules.
Q: Can I lose more than my initial investment?
A: No. Since the funds use covered calls (not naked options), losses are limited to the value of the investment.
Q: How often are options rolled?
A: The team actively manages positions daily, with adjustments made based on market conditions—not on a fixed schedule.
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Final Thoughts
Bitwise’s new ETF suite represents a bold step in bringing institutional-grade options strategies to retail investors. By combining active management with deep crypto market insight, IMST, ICOI, and IMRA offer a compelling tool for generating income from some of the most volatile—and potentially rewarding—equities in today’s market.
For investors seeking more than passive yield plays, these funds provide a sophisticated alternative grounded in real-time data and expert execution.
Core Keywords: covered call ETF, option income strategy, crypto equities, active ETF management, monthly income ETF, Bitwise ETF, MSTR options, COIN call strategy