Goldman Sachs has agreed to acquire NEOS Investments for as much as $2.25 billion in cash and stock, adding a fast-growing lineup of options-income ETFs that includes a bitcoin-linked fund with a stated 27% annualized distribution rate and a 25.4% year-to-date decline in net asset value.
The transaction would roughly double Goldman’s assets in options-based ETF strategies from about $40 billion to about $80 billion, based on figures provided with the deal. That would place the bank eighth globally among providers of these funds, which seek to turn market volatility into recurring distributions by selling derivatives contracts.
NEOS manages 19 options-income ETFs with roughly $30 billion in assets. Goldman had filed for a comparable fund about four months before pursuing the acquisition, suggesting that purchasing NEOS offered a quicker route into a category where product scale, trading infrastructure and distribution networks are already established.
BTCI shows the trade-off in crypto income funds
NEOS’s Bitcoin High Income ETF, traded under the ticker BTCI, illustrates the structure Goldman is acquiring. The fund holds bitcoin exposure through positions in 11 U.S.-listed spot bitcoin ETFs, then sells call options against that exposure to collect premiums.
BTCI had $1.11 billion in assets under management and charges a 0.98% management fee, according to NEOS. Its current monthly distribution stands at $7.75 a share, which translates to a 27% annualized rate when calculated from the stated payouts.
That payout does not represent a guaranteed investment return, and it does not necessarily reflect net gains from bitcoin or options trading. NEOS says BTCI’s distributions are classified as return of capital, a tax category that can include option premium, dividends, interest and capital gains. It can also mean a fund is returning part of shareholders’ original capital.
The difference becomes especially relevant during periods of falling crypto prices. BTCI’s net asset value was down 25.4% year to date and had recorded a 40.9% drawdown over the preceding 12 months, according to the supplied fund figures. A high cash distribution can therefore coexist with a sharp erosion in the value of the underlying holding.
Selling covered calls generally produces income by giving another party the right to buy an asset at a set price. The strategy can soften the impact of moderate declines through premium income, but it also limits gains if bitcoin rises sharply above the strike price of the options sold. In a volatile market, the income stream can be attractive while the fund’s capital remains exposed to substantial price swings.
Goldman adds a second volatility-focused ETF platform
The NEOS purchase follows Goldman’s April agreement to acquire Innovator Capital Management for $2 billion. Innovator managed more than $31 billion at the time and specializes in buffered ETFs, which set predetermined downside buffers and upside caps for a defined outcome period, often one year.
Together, the two acquisitions would give Goldman approximately $61 billion in assets tied to strategies that sell volatility or structure returns around it, according to the transaction figures. The approach has become a major part of the ETF market as asset managers package options overlays into funds designed to make regular payments.
Derivatives-income ETFs collectively held about $180 billion in assets, with annual growth exceeding 70% since 2021, according to the data cited in the supplied material. The category took in $7 billion during July alone and had attracted $40 billion in net inflows during 2026.
Those flows have developed while the 10-year U.S. Treasury yield remained near 4.70%, providing a relatively high-risk-free benchmark for income-focused portfolios. Treasury yields do not carry the price volatility of bitcoin, ether or an options-income ETF, raising the pressure on crypto-linked income products to offer distributions large enough to compensate traders for their added market and structural risk.
Staking funds offer a different route to distributions
Asset managers are also attempting to generate cash payouts from crypto holdings through staking, where tokens are committed to help validate blockchain transactions in return for protocol rewards.
Fidelity filed an amendment on July 24 that would allow its $900 million Fidelity Ethereum Fund, FETH, to stake as much as 100% of its ether holdings. Under the filing, Blockdaemon, Figment and Galaxy Digital would operate validators, while Fidelity would retain custody of the fund’s private keys.
The proposed arrangement would direct 15% of staking rewards to Fidelity, its partners and node operators, with 85% distributed to shareholders quarterly. Unlike a covered-call strategy, staking rewards arise from a blockchain network’s validation mechanism rather than from selling options. They also introduce operational risks, lock-up considerations and the possibility that the value of the staked asset declines by more than the rewards earned.
Other issuers have already moved in that direction. Grayscale began making staking-related distributions to spot crypto fund holders and paid $0.083178 per share in January 2026, totaling about $9.4 million. 21Shares enabled staking for an ether fund in October 2025, retaining 25% of rewards while waiving its 0.21% management fee for one year.
BlackRock separately listed the iShares Staked Ethereum Trust on Nasdaq. Morgan Stanley listed ether and Solana trust products on NYSE Arca on July 28 with a 0.14% management fee and said roughly 95% of income would be distributed in monthly cash payments. Its filings set an ether staking range of 50% to 80%, with an 80% maximum, while the Solana trust plans to stake all of its SOL.
Banks are also turning crypto into collateral and structured exposure
JPMorgan expanded institutional crypto-backed lending through its Kinexys platform in March 2026, allowing bitcoin and ether to be pledged for U.S. dollar loans. The bank applies a 30% to 50% haircut to the value of crypto collateral, meaning $100,000 in bitcoin or ether would support approximately $50,000 to $70,000 of borrowing.
That compares with the 1% to 5% haircuts typically applied to U.S. Treasuries in the supplied material, reflecting the far larger price swings lenders must prepare for when accepting crypto collateral. JPMorgan also filed structured notes linked to a spot bitcoin ETF benchmark, offering as much as 1.5-times upside participation subject to a cap of roughly 16% if specified conditions are met before December 2026, while leaving noteholders exposed to declines.
Goldman’s move into NEOS fits this expanding menu of crypto-linked products, but BTCI’s performance underscores the constraint behind the marketing appeal of monthly income. Options premiums, staking rewards and structured payoffs can create cash distributions, yet none removes the underlying exposure to large moves in digital-asset prices or the fees charged to maintain the product.
For deeper context on ETFs and flows, explore what are ETFs and how do they work alongside crypto-linked income products.
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