IN THIS ISSUE

Jakob TL;DR

My top reads this week were Messari’s and Nansen’s Stacks ecosystem reports. Both point to growing demand for institutional-grade BTC yield, referencing hBTC as the “long-awaited” Bitcoin Earn Vault. We hear you. hBTC is closer than you think.

Outside the reports, I’ve seen a flood of “how does BTC yield actually work” questions. I’ll be live at the Stacks Bitcoin Yield Summit to talk about the core earning paths available today, the risk, custody, and security standards behind durable yield.

The Wait Is Almost Over

The market’s demand for BTC yield is getting louder.

Independent research desks, Messari and Nansen, point to the demand for institutional-grade BTC yield with transparent mechanics in their Stacks ecosystem reports, referencing hBTC as the “long-awaited” Bitcoin Earn Vault.

We see the demand, and we hear you. The wait is almost over.

hBTC has cleared key readiness gates. Two independent audits are complete. A live bug bounty is running on Immunefi. The build is production-ready, and liquidity is aligning ahead of launch.

Access will roll out to the waitlist soon.

If your mandate includes BTC-denominated yield with transparent mechanics and rules-based risk controls, the waitlist guarantees access.

Your BTC Can Do More

Your Bitcoin can work more than one job and pay you.

Join Jakob live on March 11 at Stacks’ Bitcoin Yield Summit to learn what BTC yield opportunities exist, and what separates durable strategies from temporary incentives.

Tracking where Bitcoin is headed next?

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USDh Yield Recap

7% APY this week.

This used to be reserved for “high-yield accounts” with minimums, lockups, and an account manager.

Now, everyone eats.

Market Review

Bitcoin started the week near $68,900, traded down to about $65,800 on Thursday, before moving back to $67,800 by Thursday evening. Ether, XRP, and Solana fell more than Bitcoin, extending the risk-off rotation away from higher-beta assets. Strategy (MSTR) disclosed a 2,486 BTC purchase acquired between February 9–16 at an average price of $67,710 for $168.4M, bringing total holdings to 717,131 BTC at a blended cost basis of $76,027. 

The S&P 500 rose 0.56% to 6,881 on Nvidia and Amazon strength, before giving back gains. Walmart’s FY2027 EPS guide of $2.75–$2.85 (vs. $2.96 consensus) and hawkish FOMC minutes pulled the index down 0.28% to 6,862 and the NASDAQ down 0.31% to 22,683. The S&P briefly reclaimed its 50-day moving average at 6,894.

Data Summary:

• DVOL: 52.55%

• Equal-weighted futures basis spread: 2.19% APR, slightly up as market stabilizes

• Futures curve: flat-to-normal contango, with the front month still in backwardation

• Perp funding rates: flat to slightly positive

• Aggregated altcoin market cap: $943B

• Bitcoin dominance: down 0.42% to 58.88%

• ETF holder average cost basis: $84,000

The moving averages (MA) in Figure 1 are:

• Current Price: $66,800

• 7-Day MA:  $67,900

• 30-Day MA: $75,500

• 180-Day MA: $97,500

• 360-Day MA: $99,400

• 200-Week MA: $58,300

Bitcoin trades below all major moving averages except the 200-week, a key structural support near $58,300. The 180-day and 360-day MAs sit near $97,000–$99,000, and Bitcoin would need roughly a 40% move to reclaim the 180-day MA. The 7-day MA has started to flatten, indicating slower selling momentum. Other support levels are  $65,000, $60,000, and $52,000, with resistance at $70,000, $73,300 (20-day Exponential Moving Average), $76,000, and $80,000.

BTC ETF Flows

Net outflows continued, with $389M leaving on Monday, including a $120M outflow from BlackRock’s IBIT that ended a 71-day inflow streak. Tuesday saw another $133M in outflows. Flows were mixed across products, suggesting rotation within the ETF complex rather than a uniform exit. While IBIT and Grayscale’s GBTC saw outflows, Fidelity’s FBTC took in $58.9 million on Monday and Grayscale’s Mini Trust added $35.9M.

Approximately $8.5 billion has exited U.S.-listed spot Bitcoin ETFs since October 2025. Cumulative net inflows have fallen from a $61.5B peak to around $55B, and total ETF AUM has dropped to roughly $95B from a January peak of $168B.

Volatility

DVOL has moved from 72% to 52.55% but remains above the 35%–42% range seen before the selloff. The February 5 price action took DVOL to 90%, the highest since FTX. DVOL has since cooled, but remains high.

Structures that suppressed DVOL through 2024–2025, including TradFi call selling on ETFs, covered-call activity on treasury companies, and market maker delta hedging, have been disrupted. The February selloff overwhelmed hedging capacity and reduced market maker liquidity during peak selling. DVOL remains high in the 50%–65% range, but may normalize if Bitcoin stabilizes above $65,000 long enough for institutional options desks to re-engage.

Basis Spread

The futures basis has improved from the intermittent backwardation seen in early February. Front-month futures still trade below spot, but the negative basis is smaller than in recent weeks. The average equal-weighted spread is 2.19% APR this week versus 1.85% APR last week. Perp funding, negative during the selloff, has moved to neutral and is now slightly positive, suggesting short pressure has eased and the market is less oversold.

The curve has returned to flat-to-normal contango, though spreads remain low compared to 8%–12% APR seen in October–November 2025. Open interest remains below January peaks after more than $5 billion in liquidations.

Macro

The Fed released the January 27–28 FOMC minutes, interpreted as hawkish by the market. The committee voted 10–2 to hold rates at 3.50%–3.75%. The next meeting is March 17–18. The White House has continued advocating for rates as low as 1%, and the Powell-to-Warsh transition in May remains a key focus for monetary policy.

U.S.-Iran discussions remain a market driver, with markets responsive to related headlines. WTI crude is $66.50, gold trades near $4,990 after rebounding from $4,404, silver has stabilized in the low-to-mid $70s after its 41% drop from $121, DXY is 97.85 (down 8% year over year), the VIX at 20.2 is elevated but not signaling acute equity stress, and WTI is $66.5. Bitcoin remains down 47% from recent highs, with ETF holders about 20% below cost.

Sincerely,
The Hermetica Team