My first BTCI purchase was on 16 Sep 2025, and I have added to it through recurring buys, some one-off orders and a few reinvested payouts. This post sets out what I bought, what it paid me and how it has done up to 14 Oct 2026.
Read on for the full numbers.
Quick Verdict
BTCI has paid a very high monthly income, but the fall in bitcoin since October 2025 has outweighed it. Up to 14 Oct 2026, my position is down 12.6% after tax once payouts are counted. Payouts per share have roughly halved since I started buying.
What Is BTCI and How Does It Work?
| NEOS Bitcoin High Income ETF (BTCI) | |
|---|---|
| Inception date | 16 Oct 2024 |
| Underlying exposure | Bitcoin ETPs |
| Total expense ratio | 0.99% (0.98% management fee + 0.01% acquired fund fees) |
| Distributions | Monthly |
| Net assets | $1.43 B (13 Oct 2026) |
| Domicile / ISIN | US / US78433H6421 |
BTCI does not hold bitcoin directly. It gets exposure through spot bitcoin ETPs such as the iShares Bitcoin Trust (IBIT) and VanEck Bitcoin ETF (HODL), held through a Cayman Islands subsidiary, plus option positions on a bitcoin index. Most of the rest of the fund sits in US Treasury bills.
It sells call options for income. NEOS describes a “data-driven call option strategy” that seeks high monthly income from bitcoin’s volatility. The fact sheet notes that this “will limit the Fund’s participation in gains of Bitcoin beyond a certain point”, and that premiums “may not be sufficient to offset losses” in falls.
Tax character of the payouts. NEOS says BTCI’s distributions “have been classified as a return of capital”, which “will reduce an investor’s cost basis”. NEOS also states that income from the Cayman subsidiary “will be passed through to the Fund as ordinary income”. The BTCI fact sheet and prospectus do not mention Section 1256 (60/40) treatment, so I have not relied on it here.
My BTCI Position
| Month | Buys | Shares bought | Cost incl. commission | Average price |
|---|---|---|---|---|
| Sep 2025 | 3 | 25.0320 | $1,501.14 | $59.97 |
| Oct 2025 | 4 | 33.8000 | $2,001.53 | $59.22 |
| Nov 2025 | 4 | 40.1175 | $2,001.53 | $49.89 |
| Dec 2025 | 8 | 189.0950 | $8,441.84 | $44.64 |
| Jan 2026 | 6 | 221.1582 | $10,084.44 | $45.60 |
| Feb 2026 | 14 | 181.6062 | $6,319.55 | $34.80 |
| Mar 2026 | 8 | 23.4654 | $803.05 | $34.22 |
| Jul 2026 | 1 | 11.2352 | $323.25 | $28.77 |
| Total | 48 | 725.5095 | $31,476.33 | $43.39 |
| Value on 14 Oct 2026 | 725.5095 × $33.07 | $23,992.60 |
The buys break down as $15,364.52 of recurring buys, $14,902.45 of one-off orders and $1,209.36 of reinvested payouts (five payouts). Recurring buys were about $500 a week in 2025, $1,500 a week in January 2026, then about $200 and later $100 a day in February and March 2026. There have been no recurring buys since 13 Mar 2026, and no shares have been sold.
At the end of 2025 I held 288.0445 shares. The adjusted cost basis of $31,328.58 is $147.75 lower than the $31,476.33 I paid. That gap is return of capital: part of the 2025 payouts was treated as a return of my own money, which lowers the cost basis rather than counting as income (see the Tax section).
Payouts I Received
| Pay date | Per share | Shares | Gross | US tax withheld | Net |
|---|---|---|---|---|---|
| 26 Sep 2025 | $1.3401 | 16.5355 | $22.16 | $6.65 | $15.51 |
| 24 Oct 2025 | $1.2999 | 50.2964 | $65.38 | $19.61 | $45.77 |
| 28 Nov 2025 | $1.0181 | 98.9495 | $100.74 | $30.22 | $70.52 |
| 26 Dec 2025 | $0.9967 | 144.5018 | $144.02 | $43.21 | $100.81 |
| 23 Jan 2026 | $1.0427 | 500.7538 | $522.14 | $156.64 | $365.50 |
| 20 Feb 2026 | $0.7608 | 654.0627 | $497.61 | $149.28 | $348.33 |
| 20 Mar 2026 | $0.7804 | 714.2743 | $557.42 | $167.23 | $390.19 |
| 24 Apr 2026 | $0.7982 | 714.2743 | $570.13 | $171.04 | $399.09 |
| 22 May 2026 | $0.7934 | 714.2743 | $566.71 | $170.01 | $396.70 |
| 18 Jun 2026 | $0.6525 | 714.2743 | $466.06 | $139.82 | $326.24 |
| 24 Jul 2026 | $0.6458 | 714.2743 | $461.28 | $138.38 | $322.90 |
| 21 Aug 2026 | $0.6289 | 725.5095 | $456.27 | $136.88 | $319.39 |
| 18 Sep 2026 | $0.7184 | 725.5095 | $521.21 | $156.36 | $364.85 |
| 2025 total | $332.30 | $99.69 | $232.61 | ||
| 2026 total | $4,618.83 | $1,385.64 | $3,233.19 | ||
| 2025 tax refunded in 2026 | −$46.16 | +$46.16 | |||
| All payouts | $4,951.13 | $1,439.17 | $3,511.96 |
The 2026 withholding works out to exactly 30.0% of gross. The 2025 refund is explained in the Tax section.
My Return So Far
| 16 Sep 2025 – 14 Oct 2026 | Amount | % of $31,476.33 bought |
|---|---|---|
| Value on 14 Oct 2026 | $23,992.60 | |
| Price change only | −$7,483.73 | −23.78% |
| Payouts before tax | +$4,951.13 | +15.73% |
| Return before tax | −$2,532.60 | −8.05% |
| US tax withheld (net of 2025 refund) | −$1,439.17 | −4.57% |
| Return after tax | −$3,971.77 | −12.62% |
This counts all payouts, including the $1,209.36 that was reinvested, because the shares those payouts bought are already in the value. The after-tax figure also matches the mark-to-market totals (−$1,033.70 for Sep–Dec 2025 plus −$2,938.06 for 2026) to within a cent. The percentages are on the total amount bought, not a time-weighted return, so they are not directly comparable with the fund’s published returns below.
BTCI’s Published Returns and Distribution Rate
| To 30 Sep 2026 | 3 months | YTD | 1 year | Since inception (annualised) |
|---|---|---|---|---|
| BTCI (NAV) | 33.91% | −6.70% | −25.99% | 8.33% |
| BTCI (market price) | 33.90% | −6.41% | −25.85% | 8.47% |
| S&P Bitcoin Index | 42.31% | −4.55% | −26.96% | 11.34% |
| Distribution measure (30 Sep 2026) | BTCI |
|---|---|
| Distribution rate | 28.00% |
| 12-month trailing distribution rate | 32.92% |
| 30-day SEC yield | 1.24% |
| Latest payout | $0.7184 |
The distribution rate is the latest payout × 12 divided by NAV, so it is not a total return. The 30-day SEC yield of 1.24% is far lower, which fits with NEOS classing the payouts as return of capital rather than income.
In Bad Times: Drawdowns and Payouts
| 6 Oct 2025 – 30 Jun 2026 | Peak | Trough | Max drawdown |
|---|---|---|---|
| BTCI, total return | 6 Oct 2025 | 30 Jun 2026 | −48.4% |
| BTCI, price only | $63.69 | $26.86 | −57.8% |
| Bitcoin (BTC-USD) | $124,753 | $58,559 | −53.1% |
The peak and trough fall on the same days for BTCI and bitcoin. With payouts reinvested, BTCI fell about 5 percentage points less than bitcoin. On price alone it fell further, because most of its return comes out as payouts.
Payouts did not hold up. BTCI paid $1.2999 a share in October 2025 and $0.6289 in August 2026, a drop of about 52%. The monthly average fell from $1.105 (Oct–Dec 2025) to $0.642 (Jun–Aug 2026). My per-share income in the payouts table follows the same path.
Tax: Withholding, Return of Capital and Estate Tax
For us in Singapore, BTCI payouts are subject to 30% US withholding tax, and as a US-domiciled fund BTCI also counts as a US asset for US estate tax (IRS). 30% was withheld from every payout when it was paid.
The 2025 withholding was later reduced. In 2026, four entries were posted against each 2025 payout: the original tax reversed, re-charged, reversed again and then charged at a lower amount. Overall, the tax on the 2025 payouts fell from $99.69 to $53.53, about 16.1% of gross, so $46.16 came back. No reason was given. It is consistent with part of the 2025 payouts being reclassified after year end, as NEOS’s return-of-capital note suggests, but I have not been able to verify this.
Return of capital lowered the cost basis. $147.75 of the 2025 payouts was treated as return of capital, so the cost basis fell from $31,476.33 to $31,328.58. NEOS notes that return-of-capital distributions “will reduce an investor’s cost basis” (NEOS).
Ireland-domiciled alternative? No UCITS version of BTCI exists, as UCITS rules block direct bitcoin holdings, and no bitcoin covered-call product was found.
| Alternative | Type | ISIN | TER | Payout | Closest to | Key difference |
|---|---|---|---|---|---|---|
| CoinShares Physical Bitcoin | ETP | GB00BLD4ZL17 | 0.15% | None (accumulating) | BTCI | A Jersey note holding bitcoin; no income or calls |
It holds physical bitcoin, pays no income and writes no covered calls.
Summary of My Position
| 16 Sep 2025 – 14 Oct 2026 | Amount | % of cash paid |
|---|---|---|
| Cash paid | $31,476.33 | |
| Value on 14 Oct 2026 | $23,992.60 | |
| Payouts before tax | $4,951.13 | +15.73% |
| Payouts after tax | $3,511.96 | +11.16% |
| Return of capital (basis reduction) | −$147.75 | |
| Total return before tax | −$2,532.60 | −8.05% |
| Total return after tax | −$3,971.77 | −12.62% |
Conclusion
BTCI’s monthly payouts have been large, but they have not made up for the fall in bitcoin since I started buying. The payout per share has also dropped sharply as bitcoin fell. If you are looking at BTCI for income, the payout and the share price both move closely with bitcoin.
Related
As always, remember that Past Performance is No Guarantee of Future Results. And none of the content that I write on this site should be taken as financial advice.
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