Remember Grayscale’s GBTC? That trade blew up when GBTC traded 50% below NAV in late 2022. When that premium vanished, funds like Three Arrows Capital were margin called, and the rest is history. The “crypto acquisition vehicle” meta today has shockingly similar risks. Buyer beware.

— Donovan

Permissionless IV is hitting Brooklyn on June 24-26. Tix are $499 — but refer 5 friends to the 0xResearch newsletter and score a free Permissionless ticket. Scroll down to grab your code.

ATH in May but app users stay away:

When bitcoin first broke $100k in January 2025, onchain activity surged. Weekly application revenue hit over $330m and user-paid fees topped $1.2b — driven by trading, derivatives and general speculation across the board.

Fast forward to May, and BTC set a new all-time high near $112k. But this time, dapp revenue barely broke $110m and fees stayed under $400m — down roughly 65-70% from January levels.

The difference? January’s rally was fueled by onchain speculation and fresh capital. In contrast, May’s move was ETF- and Strategy-driven, as well as off-chain. Spot DEX and trade tooling volumes never returned, while sticky DeFi sectors like lending and wallets held steady.

The decoupling of price and usage highlights a shifting market: Protocol revenues now rely less on headline price action and more on sustained utility. Unless apps can capture the next wave of macro flows coming onchain, it’s hard to see a proper alt season rotation making any sense.

— Macauley Peterson

Blockchain tech altering the global economy is no longer a distant hope. With the market projected to grow almost 600% over the next five years, it’s safe to say the blockchain revolution is well underway.

The latest report from Blockworks Research and OKX shows how blockchain is a new alternative, shifting the landscape for 4 major industries: financial services, technology, consumer goods, and entertainment. 

These data-driven insights on the future of blockchain are a must-read for degens and empire builders alike.

The MicroStrategy playbook, explained

A specter is haunting crypto — the specter of cheap leverage.

“Digital Asset Treasury companies” (DATs) are assembling stockpiles of bitcoin by funding it with primarily cheap debt and equity.

It’s particularly weird because it’s not just financial services companies in the mix. GameStop has bought 4,710 BTC, the Japanese hotel business Metaplanet has built up $930m in BTC holdings, and the Singapore-based Basel Medical Group announced a purchase agreement of up to $1b in BTC.

Not one to be left out of the spotlight, Trump Media also announced its own $2.5b BTC treasury deal last week.

It’s not just BTC treasuries either — DeFi Development Corp. (formerly Janover) has amassed 609,190 SOL ($107m), the Consensys-backed Sharplink Gaming is raising $425m to buy ETH, and VivoPower has raised $121m for an XRP treasury.

The trade explained

DATs are funding their crypto purchases by issuing bonds at low coupon rates (0-5%).

Who’s buying these?

One group of buyers are the market-neutral hedge funds, which simultaneously buy the bond note and short MSTR stock to delta-hedge.

Their profits come from the underlying volatility of MSTR stock. When MSTR’s price goes up, the fund shorts more stock. When prices drop again, they buy it back at a lower price.

The more volatile the stock price, the more of a profitable spread there is. The profit exists because realized volatility exceeds expected/implied volatility (otherwise known as gamma-scalping).

As my colleague Byron Gilliam put it aptly, Saylor is in the business of selling cheap volatility.

The second group of buyers are long-only asset managers (e.g. Allianz, Calamos).

For these guys, if MSTR trades above the conversion price of the bond, then the bond is just like equity and can soar well past par.

Should MSTR’s price collapse, bondholders still have a senior claim on principal at maturity; today that claim is backed by ~$60.4b of BTC on its balance sheet (though MSTR’s converts are unsecured).

It’s profitable due to an asymmetric payoff. Limited downside and equity-like upside.

Both these sets of buyers enable Saylor to buy more bitcoin, which drives up the net asset value (NAV) of the company, which in turn drives up the price of MSTR stock.

This is what’s referred to as Saylor’s “infinite money loop”: It works so long as the option value of the equity trades at a premium to the net bitcoin per share (because markets are inefficient!)

Why aren't funds just buying the ETF if they want crypto exposure?

I’ll let Pantera’s Cosmo Jiang do the explaining for me, per his recent letter:

“If you buy MSTR at 2x NAV, you are buying 0.5 BTC instead of buying 1.0 BTC via spot. However, if MSTR can raise capital and grow BPS 50% per year (last year it grew 74%), by the end of year two you would have 1.1 BTC — more than if you had simply bought spot.”

Bitcoin per share (BPS) is the benchmark metric that all the participants in this game are eyeing.

DATs want to grow BPS (or ETH/SOL/XRP per share) faster than the company’s stock price appreciation, and that in turn depends on how well the firm can leverage capital markets to raise even more.

The risks

But of course, there is no such infinite money glitch.

DATs are already advertising their stock as offering “yield,” but no such organic cash yield exists. The metric works only as long as the stock price stays above the underlying NAV.

Whereas Strategy’s bonds were originally unsecured, copycats are raising capital with secured terms, which entails real liquidation risks.

Should crypto markets tank, DATs will be forced to sell their assets to repay note-holders if they cannot top up collateral.

Everyone’s excited about the buying, but no one’s talking about the potential forced selling.

Until they have to.

— Donovan Choy

Asymmetry’s USDaf and Gem Rush

Asymmetry Finance is extending what Liquity v2 can do on Ethereum, and like its progenitor, it’s doing it immutably. With Asymmetry, users can mint the USDAf stablecoin against eight different collaterals, including three bitcoin variants (tBTC, cbBTC and wBTC) and five yield-bearing stablecoins, like sUSDe and sDAI. The standout feature? You set your own fixed-rate borrow terms, and the rates are juicy — it’s currently the cheapest way to get leverage on bitcoin on Ethereum.

LPs and borrowers have attractive yield opportunities in Asymmetry’s Curve pool and Stability Pools, where yields exceed 10% with no lockup required. Typically to find that level of yield you must commit to staking or locking capital for a fixed term.

The rates will come down as the protocol attracts deposits, but they are sweetened by Gem Rush — Asymmetry’s gamified rewards program. Complete “Quests” (e.g. minting USDAf, depositing LP or staking in the Stability Pool), earn Gems and boost your Rank (from Blue to Legendary) to increase multipliers for an eventual token airdrop.

The protocol, which touts six independent audits, follows the core ethos of Liquity, according to co-founder Justin Garland.

“From a core code-based perspective, [we] changed as little as possible to inherit as much security from Liquity v2 as possible...The only thing that was changed were the collateral types.” Garland said in an X space last week.

Features like high leverage of up to 91% LTV on stables, 83.5% on BTC, no oracles and an upcoming one-click Multiply option for stablecoin looping strategies make this opportunity ripe for degens.

A staked version of the stablecoin, sUSDAf — built in collaboration with Yearn — is expected to go live this month to optimize yield across Stability Pools automatically. Pendle and Morpho integrations are next.

Bottom line: This is one of the best opportunities I’ve seen for real stablecoin yield in a decentralized protocol, with potential upside for early users.

— Macauley Peterson

How do we make markets safer — without killing permissionless design?

Join a stacked Roundtable with voices from legal, research, and protocol teams breaking down:

• Transparent infra that actually defends

• Legal frameworks that don’t break composability

• How investor protection can be opt-in, not bolted on

📆 June 3 | 12 pm ET