🔎Where do we go from here?

weekly valuable insights

In today’s newsletter:

🔎 Where do we go from here?

🪂 Two high-yield DeFi opportunities

📊 On-chain alpha

😂 Crypto meme of the week

🗞️ The latest DeFi news

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🔎Where do we go from here?

I’m not gonna lie - I roundtripped a good amount of profits in the past 2 months.

While I didn’t have high expectations for January, I expected February to be bullish as it’s historically one of the best-performing months for BTC.

But instead of our bags pumping to Valhalla, we got several new celebrity shitcoins, tariffs, a $1.4 billion exchange hack, and billions of dollars in crypto liquidations.

It is what it is. We can't control the market, but at least we can control how we react.

In this issue, I’ll talk about my market expectations for the next months and how I’m positioning myself for what’s to come:

What do I expect to happen next in the short-term?

The good news is that we might finally be close to a local bottom after the recent market bloodbath. Multiple bottom signals are starting to fire off:

• The Crypto Fear & Greed Index is at its lowest point since 2022

• Bitcoin ETFs have recently seen very large outflows (which marked a local bottom several times in the past)

• Altcoin liquidations have significantly decreased lately

However, it’s also worth keeping this in mind:

Trump’s recently announced trade tariffs on other countries seem to be one of the primary reasons for this dip as they caused a lot of market uncertainty.

Whether the fear around them is justified or not can be discussed.

But if new tariffs continue being announced in the next few weeks, this could cause some additional selling pressure in the short term.

So I believe it’s wise to remain cautious and be open to all scenarios.

What I’m doing right now:

• Rebalance my portfolio - On red days, the market shows its hand. If a token has been underperforming the market for weeks and doesn’t have any major bullish catalyst on the horizon, it might be a good idea to get rid of it

• Put my money to work in several ways - Airdrop farming, yield farming, and funding rates arbitrage are just a few of the ways how you can keep growing your crypto portfolio regardless of the market conditions

• Pay attention to altcoins which are showing relative strength - $KAITO is a recent good example. It held up well when BTC dipped and pumped straight to new all-time highs right after BTC stopped going down

A big mistake that you should avoid right now is catching falling knives.

Just because a certain token has dropped a lot recently and seems ‘cheap', it doesn’t mean that you should buy it. It is generally cheap for a reason.

Place your bets on winners, not losers, and only when you have a good reason to buy.

My mid-term market view

BTC had 2 major catalysts this cycle that fueled its rally to over $100,000:

• The launch of the first spot Bitcoin ETFs

• Trump’s inauguration as the first pro-crypto president

Prior to the actual launches of the BTC ETFs and Trump’s inauguration, these catalysts had a massive positive impact on the BTC price.

I’d say that a big reason for its recent underperformance is that crypto is now lacking an upcoming major catalyst that could fuel the next rally.

Markets are forward-looking, and there needs to be an upcoming event that can attract new buyers in order for the bull market to continue.

A US National Bitcoin Reserve could be an example of a very bullish factor.

Currently, the idea of a ‘US National Bitcoin Reserve’ is being ‘evaluated’ according to the newly appointed White House’s AI and crypto czar.

But until we get more details about the timeline for the potential launch of a US National Bitcoin Reserve or until another massive catalyst emerges, I think it’s unlikely that BTC will hit new ATHs.

These are just my honest market thoughts.

Regardless of what happens in the short-mid term though, I believe that the crypto industry has never been in a better position for the long run.

Regulatory clarity is coming. BlackRock's CEO is shilling BTC on live TV. Bank of America, the world’s 2nd largest bank, wants to launch a stablecoin.

Crypto has a bright future ahead.

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🪂Two high-yield DeFi opportunities

Today, I want to cover 2 yield opportunities that involve using Resolv.

In case you haven’t heard about Resolv yet, it is essentially a tokenless delta-neutral stablecoin protocol with an innovative dual tranche model.

USR is Resolv’s native stablecoin, while RLP is a delta-neutral vault token.

Most of the protocol’s profits are distributed to RLP, which protects USR from counterparty risks and absorbs any losses from negative funding rates.

Recently, the Resolv team announced several interesting new DeFi integrations that enable some great yield opportunities for stablecoins.

Here are two of my favorite yield strategies:

• Provide RLP as liquidity on Spectra (a competitor of Pendle) - You’ll earn a base APR between 20% and 40% (based on the historic APR) + 30x Resolv points per $1

• Leverage a position (by pressing on ‘Multiply’) with RLP as collateral and USR as a debt asset on Euler Finance - You’ll earn a base APR of up to a whopping 61% + 10x Resolv points

Regarding the 2nd strategy, I’d recommend not using a very high leverage as the RLP price could slightly drop when ETH funding rates turn negative.

You can easily get RLP by buying it using stablecoins on the Resolv app.

RLP is not exactly a stablecoin, but it can be seen as a relatively stable yield token.

Its average performance since April ‘24 has been great, with an all-time APR of ~20%. When ETH funding rates were high, the APR even surpassed 50%.

That’s why a large part of my stablecoins is deposited into Resolv, as I think it’s offering some of the best yield opportunities on the market.

If you want to try it out, use my referral link for a 20% points boost ←

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On-chain Alpha🔎

Hyperliquid became a top 3 DeFi protocol by daily revenue

Source: DeFillama

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Crypto Meme😂

Source: @naiivememe

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The latest developments in DeFi

Pendle and Gearbox went live on Sonic L1

LayerZero integrated Hyperliquid’s HyperEVM for cross-chain transfers

Curve Finance’s founder raised funds for Yield Basis, a new project aiming to solve impermanent loss

IO Net launched Co-staking, allowing $IO stakers to support GPU suppliers and earn rewards

Ethena raised $100M in funding and announced its upcoming deployment on Aptos

Babylon, the BTC staking protocol, opened registration for its airdrop

Avalanche released the Avalanche Visa Card

mETH Protocol helped Bybit recover $42 million from the Bybit hack

OpenEden introduced USDO: A regulated, yield-bearing stablecoin backed by tokenized U.S. Treasuries. cUSDO, USDO’s wrapped version, just went live on Ethereum and Base

Reserve introduced the Reserve Index Protocol, offering exposure to certain narratives in a single click

Franklin Templeton filed for a Solana ETF with staking

The SEC dropped investigations into Uniswap, Coinbase, & OpenSea

Solv Protocol released SolvBTC.BNB, a yield-bearing BTC liquid staking token that gives access to Binance Launchpools

Berachain’s Governance Phase 1 went live

Aave v3.3 went live, improving bad debt management

That’s all for this week!

Until next time,

The DeFi Investor

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