For months, speculations were rife over a collaboration between the groups.
BTS - whose members declared they were all fully vaccinated against COVID-19 - also appeared in person at the event in the General Assembly, introduced by South Korean President Moon Jae-in.
The new English single was released to celebrate the eight anniversary of the South Korean group’s fanbase touted ARMY.
Sheeran also confirmed his newest collaboration to the K-pop sensation and said he was looking forward to their new music.
Rapper Drake was named the artist of the decade.
'Butter' became the second BTS song after 'Dynamite' to be performed entirely in English.
Unlike its predecessor Dynamite, Butter went for a stronger and sharper theme for a summer release.
The song is a dance pop track that promises to cater the smooth yet charismatic charm that the group is loved for.
The band also topped the album sales and song sales charts too.
The band members went beyond singing for this album.