QS Research · Michael Burry's Scion Capital analyst template · 2006
iShares Bitcoin Trust ETF (IBIT)
As of 2026-11-06 · 10/15 boxes filled from SEC filings and market data
Conclusion: WATCH
Conviction low · base case 0% · downside -70% · upside +26%
IBIT is a fee-bearing bitcoin trust, not an operating business: TTM EBIT is -$178.4M while TTM net income is -$39.16B, so the reported loss is bitcoin mark-to-market, not cash burn (N8, N9). With no NAV or bitcoin holdings in the sources, I use a base case of 0%—shares should track NAV—rather than claim an operating mispricing. Downside arithmetic: -$39.16B / 1,301.36M shares = -$30.09/share, about -70% on $42.77; upside mirror: +$14.23B / 1,301.36M = +$10.93/share, about +26%. The only durable business cost is the fee line, -$178.4M / 1,301.36M = about $0.137/share a year, compounding against holders. The rule is not met: base is not +30%, and the -70% downside rules out long; upside just above +25% rules out short, so watch—catalysts could re-rate flows, but this is asset speculation, not deep value.
Key numbers
- Share price: $42.77
- Market cap: $55.66B
- Latest financial period: TTM to Jun 30, 2026
The 15 boxes
- ✓ 1. Long-form business notes
IBIT is not an operating business: it is a Delaware statutory trust formed June 8, 2023 that holds bitcoin and issues 40,000-share Baskets for cash, with no revenue line and no active management — it "does not engage in any activities designed to obtain a profit from, or to ameliorate losses caused by, changes in the price of bitcoin" (S20). Its only recurring cost is the Sponsor's Fee and trust expenses, paid by selling bitcoin, which produced operating losses of -$47.5M in FY2024 and -$174.6M in FY2025 as the asset base scaled from $51.52B to $67.40B of NAV. Reported net income (+$14.23B FY2024, -$8.97B FY2025) is a bitcoin mark-to-market swing, not an operating result, so the trust should be judged on assets, share count and fee drag, not on earnings.
- ✓ 2. Competitive advantage
IBIT has no durable competitive advantage of its own: the 10-K states plainly that it faces competition from other exchange-traded bitcoin products and that there is no assurance it will achieve market acceptance and scale. The only structural features the filing points to are the 40,000-share Basket size and the authorized-participant arbitrage mechanism meant to keep the share price near NAV, and even the Sponsor only "believes" that works. The financials are those of a cost-bearing wrapper, not a business: operating income was -$47.5M in FY2024 and -$174.6M in FY2025, and the net income lines (+$14.23B then -$8.97B) are driven by items far outside operations, so neither year is evidence of operating profitability.
- ✓ 3. 10-Q takeaways
Q2 2026 was a pure bitcoin-price quarter: NAV fell 18.73% from $53,384,746,718 at March 31, 2026 to $43,386,012,125 at June 30, 2026 as bitcoin dropped 13.25% to $59,101.49, and the Trust shrank via net redemptions (187,360,000 Shares redeemed vs 100,920,000 created). The Q2 2026 net decrease in net assets from operations of $7,048,147,970 was almost entirely a $5,409,838,901 unrealized loss on bitcoin, not an operating result; the only expense was the $35,422,589 Sponsor's fee (0.06% of average weighted assets of $56,816,768,207). There is no revenue, margin, inventory or buyback story — this is a passive vehicle whose only liquidity source is selling bitcoin. The 10-Q risk update adds that bitcoin fell from an approximately $126,000 October 2025 high to below $60,000 in June 2026, a drawdown of more than 50%, and that U.S. spot bitcoin ETPs saw their largest quarterly net outflows since launch in Q2 2026.
- ○ 4. Corporate governance
- ✓ 5. Overview of the prior 3 years of 8-K filings
Filled; members read this box.
- ✓ 6. Other significant filings
Filled; members read this box.
- ✓ 7. Chronology of significant news and events
Filled; members read this box.
- ✓ 8. Comparables valuation interpretation
Filled; members read this box.
- ○ 9. Insider trading interpretation
- ○ 10. Earnings-call notes
- ○ 11. Impression of the shareholder letter
- ○ 12. Scuttlebutt overview
- ✓ 13. Valuation and risk/reward summary
Filled; members read this box.
- ✓ 14. Current price suppression and potential catalysts
Filled; members read this box.
- ✓ 15. Conclusions
The call above.
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