Crypto World
Saylor’s Bitcoin Flywheel Is Now Spinning in Reverse
Strategy turned a software company into the largest corporate Bitcoin holder on earth by exploiting a simple loop: trade above your Bitcoin’s value, issue stock, buy more Bitcoin, repeat. In June 2026, Bitcoin broke below $60,000, the stock fell under its own Bitcoin value, and the loop began running the other way. Here is how the machine works, why it reverses, and whether Saylor is actually trapped.
Summary
- Strategy’s mNAV fell to roughly 0.80, meaning its stock trades below the value of the Bitcoin it holds, which disables the premium-funded loop the company used to grow.
- The same reflexive flywheel that compounded gains on the way up now compounds pressure on the way down: at a discount, issuing equity destroys Bitcoin per share, and issuing preferred stock turns expensive, choking both funding taps at once.
- Annual dividend obligations across its preferred stack quadrupled to about $1.2 billion while cash reserves fell roughly 38%, collapsing dividend coverage from more than seven years to around 14 months.
- STRC, the key funding instrument, trades near $82 against a $100 par value, and a tiny 32-Bitcoin sale to fund a dividend broke Strategy’s long-standing never-sell narrative.
- Analysts are split between a “trap” thesis and a “strained but not broken” view, and the outcome hinges almost entirely on Bitcoin’s price, with a roughly $1 billion debt maturity in 2027 as the key deadline.
For five years, Michael Saylor ran one of the most effective financial machines in modern markets, a self-reinforcing loop that converted a mid-sized software company into the largest corporate holder of Bitcoin on earth, with more than 847,000 coins on its balance sheet.
The machine had a simple engine at its center: as long as Strategy’s stock traded at a premium to the value of the Bitcoin it held, the company could issue new shares or preferred stock above that value, use the cash to buy more Bitcoin, and increase the amount of Bitcoin backing each existing share, which justified the premium and let the loop run again. It was elegant, it was relentless, and for a long time, it worked spectacularly, turning Strategy into a Bitcoin proxy that often rose faster than Bitcoin itself.
In late June 2026, that engine threw itself into reverse. Bitcoin crashed below $60,000, Strategy’s stock fell beneath the value of its own Bitcoin, and the loop that had compounded gains on the way up began compounding pressure on the way down.
This piece explains how the flywheel works, why a falling price flips it into a doom loop, and whether Saylor is genuinely trapped or merely strained.
The reason this matters far beyond one company is that Strategy is the template. Hundreds of imitators built Bitcoin and crypto treasury companies on the same premium-driven logic, and the entire category has never faced a real test of what happens when the premium evaporates, and the price of the underlying asset sits below cost.
Strategy is now running that experiment in public, with its stock at a multi-year low, a stack of preferred shares trading below their face value, a dividend bill that has quadrupled in six months, and analysts openly debating whether the company can keep funding itself without selling the Bitcoin on which its entire identity is built, never selling.
The mechanics are intricate, but the core story is one of reflexivity, a feedback loop that amplifies whatever direction the market is already moving, and the lesson it is teaching is that a flywheel is only a flywheel while the premium holds.
The machine that made Strategy the biggest Bitcoin holder on earth
To understand why Strategy is in trouble, you first have to understand why it worked so well, because the same mechanism does both. The key number is something analysts call mNAV, shorthand for the ratio between the company’s market value and the net asset value of the Bitcoin it holds.
When mNAV is above one, the stock trades at a premium: investors are paying more for a share of Strategy than the Bitcoin behind that share is worth. That premium is the fuel for the entire engine. When the stock trades above the value of its Bitcoin, Strategy can issue new shares into the market, raise cash at that elevated price, spend the cash on more Bitcoin, and end up with more Bitcoin per share than it started with, even after the new shares dilute the count. Existing shareholders come out ahead, the higher Bitcoin-per-share figure justifies the premium, and the company can do it all again.
This is the flywheel, and for years it spun in Strategy’s favor with remarkable force. Every time Bitcoin rose, the premium tended to widen, which let Strategy raise more capital on better terms, which bought more Bitcoin, which lifted Bitcoin-per-share and the stock alongside it.
The company layered on a second source of fuel, a series of preferred stock instruments that let it raise money without diluting common shareholders directly, expanding the machine’s capacity. By accumulating relentlessly through this loop, Strategy built a position of more than 847,000 Bitcoin, acquired at an average price of roughly $76,000 per coin, and turned itself into the way many investors chose to hold leveraged exposure to Bitcoin through a regular brokerage account.
Saylor made perpetual accumulation the company’s whole identity, and the premium-funded flywheel was the mechanism that made the accumulation possible. The crucial thing to notice, the thing that explains everything that followed, is that the entire machine depends on that premium. Take away the premium, and the engine does not just slow down. It runs backward.
The week the premium died
That is precisely what happened in the final week of June 2026, and the speed of it caught even seasoned observers off guard. Bitcoin, which had been grinding lower for weeks beneath all of its major moving averages, broke hard, falling to around $59,000 in its worst single-day drop in months, a decline of roughly 5% that triggered a cascade of forced liquidations across crypto derivatives markets, with about $1.1 billion of leveraged positions wiped out in a single day. Strategy fell with it, as it almost always does, but it fell further.
The stock dropped more than 10% to around $92, then slid the next session again, breaking below $100 for the first time since early 2024 and hitting a two-and-a-half-year low. From its peak, the stock had lost roughly 81% of its value, erasing on the order of $150 billion in market capitalization.
The number that mattered most, though, was not the stock price or even the Bitcoin price. It was the mNAV, which fell to approximately 0.8. Strategy was now trading at a discount to its own Bitcoin: the market valued the company at less than the coins on its balance sheet were worth.
For a company whose entire model rests on trading at a premium, crossing below 1 is not a cosmetic change but a structural one, because it disables the engine. And it disabled both halves of that engine at once. With the common stock below the value of its Bitcoin, issuing new shares would destroy Bitcoin-per-share rather than build it.
With the preferred shares trading well below their face value, raising money through new preferred issuance had become punishingly expensive. Both capital taps, the two ways Strategy funds itself, were constrained at the same moment, and the company found itself holding more than 847,000 Bitcoin bought at an average price far above the current one, sitting on an estimated $10.6 billion in unrealized losses, with every coin it purchased in 2024, 2025, and 2026 underwater. The premium that powered the flywheel was gone, and without it, the machine had nothing to run on.
Why a discount breaks the flywheel
It is worth being precise about why crossing below an mNAV of one is so damaging, because the reversal is not merely the absence of the previous tailwind; it is an active headwind. Run the flywheel logic backward, and the problem becomes clear.
At a premium, issuing stock to buy Bitcoin increases Bitcoin-per-share, which helps shareholders. At a discount, the same action does the opposite: if the company issues shares below the value of its Bitcoin and uses the proceeds to buy more, each existing share ends up backed by less Bitcoin than before, not more, because the new shares were sold for less than the Bitcoin they represent.
The accretive loop becomes a dilutive one. The single most important tool Strategy used to grow now actively harms the shareholders it is meant to serve, which means the company effectively cannot use it. The equity engine does not just idle at a discount; it goes into reverse if switched on.
The preferred-stock engine suffers a parallel breakdown. Strategy’s preferred instruments were designed to raise money efficiently, but that efficiency depended on those instruments trading at or above their face value. When they slip well below face value, the company can only issue new ones by effectively promising a much higher yield, which makes the funding expensive and, past a point, impractical. So the second tap tightens just as the first one closes.
The result is a company that, at the very moment its Bitcoin is underwater, and its cash needs are rising, has lost the two mechanisms it relied on to raise money. This is the essence of reflexivity, the property that makes the model so powerful in both directions.
On the way up, a rising price widens the premium, which eases funding, which buys more Bitcoin, which lifts the price further. On the way down, a falling price kills the premium, which chokes funding, which raises the specter of selling Bitcoin to cover obligations, which threatens to push the price down further still. The machine is built to amplify, and amplification is wonderful until the direction changes.
STRC: the funding engine that stalled
Nowhere is the stall more visible than in the preferred instrument Strategy nicknamed Stretch, which trades under the ticker STRC and has become the clearest barometer of the company’s stress.
STRC is a perpetual preferred stock, meaning it has no maturity date, with a variable dividend rate that the company resets monthly with the explicit goal of keeping the security trading near its $100 face value.
Strategy launched it in mid-2025 through an offering that raised roughly $2.5 billion, marketing it to income-seeking investors as something close to a high-yield savings account, a stable instrument paying a generous dividend, recently around 11.5%, distributed in cash twice a month.
As a fundraising engine, STRC was meant to let Strategy raise money to buy Bitcoin without diluting common shareholders, and it worked beautifully while it traded at or above face value.
In June 2026, STRC broke down. It fell to record lows near the low 80s, roughly 17% below its face value, and that gap is what signals the engine has stalled. The loop only works above par: when STRC trades above $100, Strategy can issue new shares and funnel the proceeds into Bitcoin cheaply. Below par, that mechanism breaks, because issuing new preferred stock at a discount means accepting a far higher effective cost of capital.
The decline also drew a pointed accusation from longtime Bitcoin critic Peter Schiff, who argued that Saylor had marketed STRC to risk-averse retirees by assuring them the volatility had been stripped out, and that with the instrument now well below what many paid for it, erasing close to two years of dividends in price terms, the company had made material misrepresentations. Strategy’s defenders counter that the dividend rate resets precisely to pull the price back toward par over time, and that the decline reflects the market demanding a higher yield in a stressed environment rather than a fundamental break.
Either way, the practical reality is the same: the instrument designed to be Strategy’s smooth, reliable funding engine is sputtering, and a sputtering STRC means the company has lost its least dilutive way to raise cash at the worst possible time.
The dividend bill nobody is talking about enough
While the headlines fixate on the Bitcoin price and the stock, the more immediate pressure on Strategy is something quieter and arguably more dangerous: a cash squeeze created by its own dividend obligations. As Strategy issued more and more preferred stock to fund its Bitcoin buying, it accumulated a growing stack of instruments, STRC alongside others trading under tickers like STRK, STRF, STRD, and STRE, each carrying a dividend that must be paid in cash.
The combined annual obligation across all of them has ballooned from roughly $300 million at the start of 2026 to approximately $1.2 billion by June, a near fourfold increase in under six months. That is $1.2 billion a year the company must pay out, regardless of what Bitcoin does, regardless of whether its stock trades at a premium or a discount.
Against that rising bill, the company’s cash cushion has shrunk. Strategy’s dollar reserves fell by about 38% over the first half of 2026, partly because it spent roughly $1.5 billion in May buying back convertible notes, draining the very buffer that supports the dividends. The result is a metric that has deteriorated alarmingly: dividend coverage, a measure of how long the cash reserve could keep funding the payouts, collapsed from more than seven years to around 14 months.
One prominent analytics firm calculated that Strategy would need to rebuild its reserves to roughly $2.8 billion to restore a comfortable two years of coverage, and urged the company to halt Bitcoin purchases entirely until it does.
The squeeze is structural and self-inflicted: the more preferred stock Strategy issued to buy Bitcoin, the larger its perpetual cash obligations grew, and those obligations do not pause when Bitcoin falls. Crucially, the dividends are cumulative, meaning any payment Strategy skips still has to be made up later, so the company cannot simply switch them off to conserve cash without damaging its standing with the investors it depends on.
This is the real near-term pressure point. It is not that Bitcoin is down; it is that the bills come due in dollars, the dollar reserve is shrinking, and the usual ways of refilling it have stopped working.
The 32-Bitcoin sale that said everything
The moment that crystallized the market’s anxiety was almost comically small in scale. In late May and early June 2026, Strategy sold 32 Bitcoin, worth around $2.5 million, to help fund a distribution on its preferred stock.
Against a holding of more than 847,000 coins, 32 Bitcoin is a rounding error, a fraction of a fraction of the stack. And yet the disclosure sent a shock through the market, with Strategy’s shares falling more than 9% in a single session and Bitcoin itself sliding on the news. The reaction was wildly out of proportion to the size of the sale, which is exactly what made it significant.
The reason a negligible sale moved the market so much is that it broke a narrative. For years, Saylor’s defining promise was that Strategy buys Bitcoin and never sells it, that the company is a one-way accumulation vehicle whose conviction is absolute. The 32-coin sale, however tiny, was the first time in roughly 4 years that Strategy had sold any Bitcoin at all, and it was sold not opportunistically but to cover a cash obligation.
The company framed it as a demonstration of strength, proof that it could meet its dividend commitments through asset sales if needed. The market read it the opposite way: as the first visible crack in the never-sell promise, and as confirmation that the dividend machine had grown large enough to force sales of the asset it was built to accumulate.
A treasury company that has to sell its treasury to pay its bills has crossed a psychological line, and the size of the sale is almost beside the point. What investors saw was the principle giving way, and the principle was the whole story. Once the market accepts that Strategy will sell Bitcoin to meet obligations, the only remaining question is how much and how often, and that question hangs over everything.
Is Saylor actually trapped?
This brings us to the word that has attached itself to Saylor’s situation: trapped.
The trap thesis, laid out by several analysts, runs like this. Strategy cannot effectively buy, because at a discount, raising money to purchase Bitcoin destroys shareholder value rather than creating it. It cannot easily sell, because dumping Bitcoin would crystallize billions in losses and, given Strategy’s size, would likely push the Bitcoin price down further, deepening the very problem it is trying to solve and harming the asset that underpins the entire structure. And it cannot comfortably stand still, because the dividend obligations keep coming due in cash, the reserve keeps shrinking, and the preferred shares keep signaling stress.
One veteran portfolio manager assigned rough odds to the outcomes, putting his base case at a 70% chance that Strategy keeps selling small amounts of stock at unfavorable, non-accretive levels, slowly grinding the mNAV down toward an even steeper discount, with a smaller chance that Saylor sells several billion dollars of Bitcoin outright to buy time. In this reading, every available move makes some part of the structure worse, which is what a trap means.
The case against the trap framing deserves equal weight, because the situation, while genuinely strained, is not the same as imminent collapse, and several analysts argue exactly that. Forced selling is not actually required right now. Strategy is not contractually obligated to sell Bitcoin to defend its preferred shares; it can raise the dividend rate, issue shares even at unattractive levels, or use other tools to signal it can keep paying, and it has been doing so. It still holds an enormous, unencumbered Bitcoin position and retains real flexibility.
One prominent equity analyst reiterated a buy rating with a price target far above the current level, describing the preferred-stock decline as a market-driven reset of the yield investors require instead of a structural breakdown, a sign of a model strained but not broken.
Saylor himself points out that, despite the brutal drawdown, the stock remains a multiple of where it traded when he began buying Bitcoin in 2020, and that the company’s long-term objective is to maximize Bitcoin per share over the years, not to defend any particular monthly price. And the entire predicament reverses if Bitcoin simply recovers: a rising price would restore the premium, reopen the funding taps, and turn the flywheel forward again.
The honest assessment is that Strategy is under real, compounding pressure with a narrowing set of good options, which is a serious condition, but it is not yet insolvency, and conflating strain with doom is its own kind of error.
The 2027 wall and the price that has to hold
If you want to know what the market is really watching for, look past the daily price swings to a specific date and a specific number. Strategy carries debt, and one analyst has flagged roughly $1 billion of it maturing in September 2027.
To repay that obligation without selling Bitcoin, the reasoning goes, Strategy’s stock would need to trade above roughly $183, a level that corresponds to a Bitcoin price somewhere around $91,500 at an mNAV of one.
With the stock near or below $100 and Bitcoin around $60,000, the company sits far below that threshold, which is why the 2027 maturity has become a focal point. It is not an immediate crisis, since the date is more than a year out and Strategy has tools and time, but it functions as a deadline against which all the other pressures are measured. The runway is real, but it is not unlimited.
This frames the two scenarios cleanly. In the recovery scenario, Bitcoin climbs back over the months ahead, Strategy’s stock returns to a premium, the funding engine reopens, the preferred shares drift back toward par, and the dividend coverage rebuilds, at which point the trap dissolves, and the flywheel resumes spinning forward, exactly as it has after previous Bitcoin downturns.
Saylor’s entire bet is that this is what happens, that Bitcoin’s long-term trajectory rescues the structure as it always has before, and that conviction through the drawdown is the price of the eventual recovery.
In the adverse scenario, Bitcoin stays low or falls further, the discount persists, STRC remains below par, the cash reserve keeps shrinking against the $1.2 billion dividend bill, and Strategy is forced into steady, value-destroying sales of stock or, eventually, Bitcoin, grinding the structure down toward the 2027 wall in a weakened state.
The truth is that no one knows which path unfolds, because it depends overwhelmingly on the one variable Saylor cannot control, the price of Bitcoin. What can be said is that the model has lost its margin for error. For years, the flywheel gave Strategy the luxury of never having to be right about timing. Now, for the first time, timing matters, and the company is waiting on a price recovery it can only hope for.
What it means beyond Strategy
Step back from the single company and the larger significance comes into focus, because Strategy is not an isolated case but the original of a type. Its success spawned a wave of imitators, more than 200 Bitcoin and crypto treasury companies built on the identical premium-driven logic, each raising capital against a market premium to its holdings and buying more of the underlying asset, each implicitly assuming the premium would persist.
None of these companies had truly been tested by a sustained environment in which the underlying asset trades below their cost and the premium turns into a discount, because that environment had not arrived at scale.
Now it has, and Strategy, as the largest and most leveraged example, is the stress test the entire category is watching. What breaks or holds at Strategy tells every imitator something about the durability of the model they copied.
The deeper lesson is about the nature of reflexivity itself, and it is a lesson that applies to far more than Bitcoin treasuries. A reflexive machine, one whose inputs feed its outputs feed its inputs, is a wealth-compounding marvel while the cycle runs in your favor and a value-destroying trap when it runs against you, and the same features that make it powerful in one direction make it dangerous in the other.
Strategy’s flywheel did not change; the direction did, and that was enough to convert the most admired financial engine in crypto into a structure that analysts now describe with words like pickle and trap. Whether Saylor escapes depends on Bitcoin, and Bitcoin has rescued him before, which is why writing the company off would be as foolish as assuming it is invincible.
The honest watch list is short and specific: whether the mNAV climbs back above one, whether STRC reclaims its par value, whether the dividend coverage stabilizes, whether the company sells more Bitcoin, and above all, whether Bitcoin’s price recovers in time. Until those questions resolve, the machine that built the largest corporate Bitcoin position on earth is spinning in reverse, and everyone who copied it is watching to see how far backward it goes.
Frequently Asked Questions
What is mNAV and why does it matter for Strategy?
mNAV is the ratio between Strategy’s market value and the net asset value of the Bitcoin it holds. Above 1, the stock trades at a premium to its Bitcoin, which lets the company issue shares above that value, buy more Bitcoin, and increase Bitcoin per share, the loop that powered its growth. In June 2026, mNAV fell to about 0.8, meaning the stock trades at a discount to its own Bitcoin. That breaks the engine, because issuing shares at a discount destroys Bitcoin per share instead of building it, disabling Strategy’s main way of funding itself.
Why is Strategy’s flywheel now working against it?
Because the model is reflexive, amplifying whatever direction the market is moving. At a premium, a rising Bitcoin price widens the premium, eases funding, and buys more Bitcoin, lifting the stock further. At a discount, a falling price kills the premium, chokes funding, and raises the prospect of selling Bitcoin to cover obligations, which can push the price down further. The same mechanism that compounded gains on the way up now compounds pressure on the way down. Both of Strategy’s funding taps, common equity and preferred stock, are constrained at once because the stock trades below its Bitcoin value.
What is STRC and why is its price important?
STRC, nicknamed Stretch, is Strategy’s perpetual preferred stock, with a variable dividend reset monthly to keep it trading near its one-hundred-dollar face value. It was a key fundraising engine: when it trades above face value, Strategy can issue more and buy Bitcoin cheaply without diluting common shareholders. In June 2026, it fell to record lows near the low eighties, well below par, which breaks that mechanism, because issuing new preferred at a discount means a much higher cost of capital. Its slide is the clearest market signal that Strategy’s smoothest funding source has stalled.
Is Michael Saylor being forced to sell Bitcoin?
Not in a forced, contractual sense, at least not yet. Strategy did sell thirty-two Bitcoin in mid-2026 to fund a dividend, its first sale in about four years, which alarmed the market as a symbolic break from its never-sell stance. But the company is not required to sell to defend its preferred shares; it can raise the dividend rate, issue shares, or use other tools, and it retains a large, unencumbered Bitcoin position. The risk is that persistent stress leads to steady, value-destroying sales over time. Analysts consider a near-term forced liquidation unlikely, while disagreeing on how much pressure builds from here.
Why did selling just 32 Bitcoin matter so much?
Because it broke a narrative instead of a balance sheet. 32 Bitcoin is a rounding error against Strategy’s 847,000-coin stack, but it was the first sale in roughly four years and was made to cover a cash obligation, not to take profit. Saylor’s defining promise was that Strategy buys and never sells, so any sale, however small, signaled that the dividend machine had grown large enough to force sales of the asset it exists to accumulate. Once the market saw the never-sell principle give way, the only remaining questions were how much and how often, which is why a tiny sale moved the stock sharply.
Could Strategy recover, or is the model broken?
It could recover, and the outcome depends overwhelmingly on Bitcoin’s price, which Saylor cannot control. If Bitcoin climbs back, the premium returns, the funding taps reopen, the preferred shares drift toward par, and the flywheel resumes spinning forward, as it has after past downturns. If Bitcoin stays low, the discount persists, the cash squeeze from a $1.2 billion dividend bill worsens, and the company faces steady, value-destroying sales heading toward a roughly $1 billion debt maturity in 2027. Some analysts call the model strained but not broken; others see a trap. The honest answer is that the margin for error is gone, and timing now matters.
This article is information, not investment advice. It describes a fast-moving and contested situation, and prices, holdings, dividend obligations, and analyst views change quickly. Figures reflect reporting available as of June 25, 2026. Cryptocurrency and equities are volatile, and nothing here is a recommendation to buy or sell any asset. Verify current data from primary sources and consider your own circumstances before making any decision.
Crypto World
Aave Co-Founder Kulechov Dismisses AAVE Discount Sale Reports, Teases Aavenomics 3.0 Buyback Plan
TLDR:
- Kulechov firmly denied reports of selling AAVE at a 70% discount, calling the media framing inaccurate.
- All Aave Protocol, GHO, and product revenue flows entirely to the AAVE token under the Aave Will Win proposal.
- Aave Labs is designing Aavenomics 3.0, featuring a new automated and non-discretionary AAVE buyback mechanism.
- Aave targets the entire financial asset market, including real-world assets, beyond the crypto-native TAM.
Aave co-founder Stani Kulechov has moved to address circulating discussions about AAVE token sales and the protocol’s revenue model.
In a post on X, Kulechov pushed back on what he called inaccurate media framing surrounding Aave Labs and its token allocation.
He confirmed that all protocol and GHO revenue flows to the AAVE token while teasing a new automated buyback mechanism. The protocol currently generates $134 million in annualized revenue.
Kulechov Rejects Discount Sale Reports, Outlines Revenue Framework
Kulechov was direct in dismissing reports suggesting AAVE tokens could be sold at a steep discount. Addressing the claim head-on, he wrote, “There is NO WAY we’d sell AAVE at a 70% discount lol.”
He then moved to clarify the structure governing all revenue flows within the Aave ecosystem. The Aave Will Win (AWW) proposal, already passed by the DAO, forms the backbone of that structure.
Under AWW, 100% of Aave Protocol and GHO revenue is directed to the AAVE token. Kulechov confirmed the framework also covers all product revenue streams. “AWW also applies to all product revenue, including the Aave App, Aave Pro, and Swaps,” he stated. None of that revenue flows to Aave Labs, which operates solely as a service provider to the DAO.
He also addressed Aave Labs’ own AAVE token allocation separately. Kulechov noted that “multiple market participants have discussed purchasing, directly or indirectly, through deeper long-term partnerships.”
That allocation is distinct from the DAO’s revenue framework and does not alter how protocol earnings are distributed to token holders.
On intellectual property, Kulechov was equally clear. He confirmed that “all intellectual property, including the Aave brand and any software built for Aave, belongs to AAVE.” Token holders, not Aave Labs, hold rights over these core assets under the current governance structure.
Aavenomics 3.0 and Aave’s Broader Financial Ambition
Beyond correcting the revenue narrative, Kulechov pointed to a coming upgrade. He revealed that “the Aave team is designing Aavenomics 3.0, which includes a new automated and non-discretionary buyback mechanism.” He noted that further details would follow in a later announcement, keeping the specifics close for now.
The planned buyback builds on a strong revenue foundation. Aave is generating $134 million in annualized revenue, all of which flows to the Aave DAO.
That base positions the DAO to sustain meaningful token buybacks without relying on discretionary decisions from any single party.
Kulechov also broadened the scope of Aave’s stated ambitions. He said Aave is “building not only for the crypto TAM, but for the entire finance asset TAM, including RWAs.” That framing places Aave alongside traditional finance infrastructure rather than solely within the DeFi space.
He closed his remarks with a pointed statement on organizational alignment. “Everyone at Aave Labs and Aave DAO works for AAVE,” he wrote.
That statement was directed at reassuring token holders that commercial and governance structures remain oriented around their interests above all else.
Disclosure: This article does not represent investment advice. The content and materials featured on this page are for educational purposes only.
A new 2026 ranking highlights beginner-friendly trading platforms based on simplicity, reliability, and trustworthiness for first-time investors.
Summary
- SaintQuant tops a 2026 ranking of beginner trading platforms, citing simplicity, stability, and ease of use.
- A new 2026 review names SaintQuant the best platform for beginners seeking hands-off, automated trading.
- Beginner-focused trading platform rankings highlight SaintQuant for automation, accessibility, and risk controls.
For those who are new to investing, the hardest part is not placing a trade — it is choosing where to trade in the first place. Search for the best trading platform for beginners, and dozens of names come up, conflicting reviews, and interfaces that look like an airplane cockpit. For a beginner, that complexity is intimidating, and complexity is exactly what causes costly mistakes.
So we ranked the five best trading platforms for beginners in 2026 using three priorities that actually matter when somoen is starting out: simplicity (how easy it is to begin), stability (how well it holds up when markets fall, not just when they rise), and credibility (whether someone can trust it with their money). Whether someone wants a traditional broker or a hands-off automated option, there is a fit here for everyone.
How these platforms were ranked
Every platform below was measured against the same beginner-focused criteria:
- Simplicity: Can a complete beginner start in minutes without a finance background or coding?
- Stability: Does the platform — or its strategies — hold up during a one-sided market downturn, or does it only work when prices rise?
- Credibility: Is the company transparent about fees, withdrawals, and risk, with a real track record?
- Supported markets: Can assets be accessed whenever the user wants and diversify as they grow?
- Cost to start: Is there a low barrier, free trial, or demo to learn without risking much?
One honest note before the list: no platform removes market risk, and none guarantees profit. The best beginner platform is the one that keeps things simple and protects its users while they learn.
1. SaintQuant — Best overall for hands-off beginners
Best for: Beginners who want automated, stable trading without learning to read charts.
SaintQuant tops the list because it removes the single biggest barrier for newcomers: no need to know how to trade. There is no configuration, no coding, and no chart-watching. Users pick a pre-built, pre-optimized strategy, launch it in a few clicks, and the platform handles execution, strategy management, and 24/7 market monitoring automatically.
On simplicity, it is hard to beat — the entire experience is built for people who want results without complexity. On stability, it stands apart from typical beginner platforms: rather than only profiting when prices rise, SaintQuant runs quantitative strategies designed to pursue steady, rules-based returns across market conditions, with risk controls structured directly into each strategy to help manage volatility and one-sided downturns. On credibility, it is transparent about how it works and supports cryptocurrencies, stocks, and futures from a single account.
New users also get a $99 free starter trial credit to experience live strategies before depositing, plus a $7 instant cash bonus at registration with no hidden conditions — a low-pressure way to see how it performs before committing real money.
Watch a live review of SaintQuant in action:
Pros: Truly no-code, designed for stability in down markets, multi-market support, free trial credit.
Cons: Pre-built strategies favor simplicity, so advanced users may eventually want more granular controls.
2. eToro — Best for social and copy trading
Best for: Beginners who want to learn by following experienced traders.
eToro built its reputation on an approachable interface and copy trading, which lets newcomers mirror the moves of more experienced investors. For a beginner who learns best by watching others, that lowers the intimidation factor considerably.
The trade-off is that copy trading still leaves users exposed to the market’s direction and the choices of whoever they copy. It is simple to start, but results depend heavily on who they follow.
Pros: Beginner-friendly interface, copy trading, broad asset access.
Cons: Copying does not remove risk; outcomes depend on the trader someone follows.
3. Webull — Best free stock trading app
Best for: Beginners who want a clean, commission-free stock app.
Webull offers commission-free trading with a tidy mobile experience and useful learning tools, making it a popular entry point for new stock investors. Paper trading lets beginners practice before risking real funds.
It leans toward self-directed trading, so users still make every decision themselves. That suits people who want to learn actively, but it offers little protection during a downturn beyond personal discipline.
Pros: Commission-free, clean app, paper trading.
Cons: Fully self-directed; no built-in downturn protection.
4. Fidelity — Best for long-term credibility
Best for: Beginners who prioritize a trusted, established institution.
Fidelity is a long-established name with a strong reputation, broad research tools, and excellent customer support. For beginners who value credibility and stability of the institution above all, it is a safe, respected choice.
The platform is more oriented toward long-term investing than active or automated trading, and its depth can feel like a lot for an absolute beginner. But few names inspire more trust.
Pros: Highly credible, strong support, great for long-term investing.
Cons: Less suited to automated or active trading; feature depth can overwhelm.
5. Robinhood — Best for ultra-simple first trades
Best for: Beginners who want the simplest possible first trade.
Robinhood popularized commission-free, frictionless trading with an interface so simple anyone can place a trade in minutes. For sheer ease of starting, it is among the simplest options available.
That same simplicity has drawn criticism for encouraging impulsive trading, and it offers little to protect beginners when markets fall. Simple to start is not the same as stable.
Pros: Extremely simple, commission-free, fast onboarding.
Cons: Minimal downturn protection; simplicity can encourage impulsive trades.
Quick comparison at a glance
| Platform | Best For | Simplicity | Stability in Downturns | Credibility |
| SaintQuant | Hands-off beginners | ★★★★★ | ★★★★★ | ★★★★ |
| eToro | Copy trading | ★★★★ | ★★★ | ★★★★ |
| Webull | Free stock app | ★★★★ | ★★ | ★★★★ |
| Fidelity | Long-term trust | ★★★ | ★★★★ | ★★★★★ |
| Robinhood | First trades | ★★★★★ | ★★ | ★★★ |
How to choose the right platform
The best choice comes down to what kind of beginner someone is:
- Want it fully hands-off and stable in any market? Start with an automated platform like SaintQuant.
- Want to learn by following others? A copy-trading platform like eToro fits.
- Want a trusted institution for the long term? Fidelity is hard to beat on credibility.
- Just want the simplest first trade? Robinhood or Webull get started fast.
Whatever is chosen, apply the same beginner discipline: start small, understand the fees, and never invest money a user cannot afford to lose.
The Bottom line
For most beginners in 2026, the best trading platform is the one that is simple to start, stable when markets turn, and credible with money. That balance is why SaintQuant leads this list — it pairs genuine no-code simplicity with quantitative strategies designed to hold up during downturns, not just rallies.
New users can claim a $99 free trial package plus a $7 instant cash bonus with no deposit and no strings attached, making it easy to experience stable, automated trading before committing personal capital.
Disclosure: This content is provided by a third party. Neither crypto.news nor the author of this article endorses any product mentioned on this page. Users should conduct their own research before taking any action related to the company.
Crypto exchange Kraken and onchain asset manager Maple have launched an onchain warehouse financing facility for crypto-backed loans, applying a lending structure widely used in traditional credit markets to institutional digital asset lending.
According to Thursday’s announcement, the facility will fund Kraken’s OTC lending business using a bankruptcy-remote special purpose vehicle (SPV) and USDC-denominated financing.
Unlike traditional bilateral crypto loans, the facility is structured through the SPV, with Maple providing senior financing and Kraken retaining a stake in the transaction. The arrangement is intended to let Kraken expand its institutional lending business without tying up additional balance-sheet capital.
Tokenized credit has grown to more than $6.2 billion in distributed value from roughly $1.87 billion a year ago, according to RWA.xyz data. Maple is the sector’s largest platform, with approximately $1.4 billion in tokenized credit assets.
Maple said the structure gives institutional lenders access to senior, overcollateralized exposure backed by Bitcoin and Ether while allowing collateral and loan performance to be tracked onchain.
Commonly used in large commercial transactions, in particular commercial mortgage-backed securities (CMBS), a bankruptcy-remote SPV removes the borrower’s ability to file for bankruptcy.
Kraken affiliates will originate, sell and service the loans while retaining a position in the transaction. Kraken Financial, a Wyoming-chartered Special Purpose Depository Institution, will hold the underlying collateral, while independent SPV administrator Zaria will oversee administration of the facility. The companies did not disclose the facility’s size or financial terms.
Related: FalconX expands tokenized credit facility to Monad network in lending push
Tokenized credit market continues to expand
The announcement comes as crypto lending continues to rebuild following the 2022 market collapse, with firms expanding institutional lending and blockchain-based credit infrastructure after the failures of lenders such as Celsius and BlockFi.
In May, Ripple secured a $200 million credit facility from investment manager Neuberger Berman to expand the lending capacity of its institutional prime brokerage business. The financing is intended to support margin lending and other credit products for hedge funds, trading firms and other institutional clients.
The same month, analysts at Bernstein said tokenized credit could represent a $4 trillion addressable market as blockchain-based lending expands beyond niche use cases into sectors including mortgages, auto loans and small-business lending.
Source: RWA.xyz
While onchain lending has continued to evolve, some parts of the decentralized finance sector have struggled. Earlier this month, lending protocol Radiant Capital said it would wind down after failing to recover from a $50 million exploit in 2024, citing an inability to replace lost funds or secure new capital.
Magazine: The end of anonymity? AI could unmask crypto’s hidden identities
TLDR:
- Cardano active addresses have spiked for the second time this month as ADA trades near 2020 lows.
- A Cardano-based wallet protocol was exploited for nearly 129 million ADA, worth roughly $20 million.
- Charles Hoskinson’s warnings and governance disputes have fueled FUD while boosting social dominance.
- Analysts flag a TD Sequential buy signal but warn a bull trap may form near the $0.160–$0.176 range.
Cardano active addresses have spiked sharply even as ADA trades near its lowest price since December 2020. On-chain activity is rising for the second time this month alongside social dominance.
The combination of extreme price pressure and growing community debate has pulled Cardano back into the spotlight. Traders and analysts are now watching closely for what comes next.
On-Chain Activity Rises Amid Price Decline
Santiment data shows Cardano active addresses and social dominance have both surged simultaneously. This pattern has appeared twice before this month, each time preceding a mild relief rally.
The current setup mirrors those earlier instances closely, according to the charting data shared by Santiment Intelligence on X.
Much of the attention stems from statements made by Charles Hoskinson, Cardano’s founder. He recently warned that more Cardano-based projects could fail in the current environment. He also announced a step back from public involvement, which added to broader community uncertainty.
Governance disputes over treasury funding have further divided the Cardano ecosystem. These disagreements have fueled bearish sentiment across social platforms. However, they have also driven increased conversation and engagement around ADA at a critical price level.
Despite the FUD, the spike in daily active addresses points to heightened user engagement. Historically, such setups have preceded short-term price recoveries. Santiment noted that the two previous occurrences of this pattern resulted in at least a mild upward move.
Analysts Flag Bull Trap Risk After Security Breach
A security breach affecting a Cardano-based wallet protocol has added further pressure on ADA. The exploit drained nearly 129 million ADA, valued at roughly $20 million at current prices. This incident came at a particularly vulnerable moment for the broader Cardano ecosystem.
Despite that, Ali Charts flagged a TD Sequential buy signal on ADA’s daily chart. This technical signal typically points toward a near-term price bounce. However, the analyst cautioned that the wider market structure does not support a sustained recovery at this time.
Any relief rally is expected to meet resistance between $0.160 and $0.176. Ali Charts noted that a failure to break above that range could trap buyers and push ADA toward new lows. The $0.176 level is the key level traders should watch for signs of rejection.
The convergence of a buy signal with ongoing negative headlines creates a mixed picture for ADA. Traders are advised to proceed with caution in this environment.
The combination of a security breach, governance tension, and Hoskinson’s withdrawal creates significant headwinds for any recovery attempt.
BitGo Holdings said it cut nearly 15% of its workforce on Thursday, a move its CEO framed as a “one-time” restructuring as the company directs more resources toward security, trading, stablecoins and AI-driven infrastructure.
CEO and co-founder Mike Belshe shared the decision on X, writing that the crypto industry’s evolution has changed how financial services should be built and that the firm needs to be “sharper, more focused” in the areas that matter most. BitGo did not immediately respond to a request for comment.
Key takeaways
- BitGo laid off about 15% of staff on Thursday, according to CEO Mike Belshe’s post on X.
- Company focus areas highlighted by Belshe include security, trading, stablecoins, settlement, and AI-powered infrastructure.
- BitGo said the reductions are intended as a one-time action and does not expect further workforce cuts.
- Despite hiring plans—51 open roles listed on its job board—BitGo’s stock fell on the day of the announcement.
CEO outlines “focused” priorities after workforce cut
In his statement, Belshe described the layoffs as a difficult decision and linked the timing to broader changes in the ecosystem. He argued that BitGo’s operating approach must align with how financial services are increasingly delivered, and he tied the restructuring to a need for sharper prioritization.
Belshe specifically pointed to five internal focus areas: security, trading, stablecoins, settlement, and artificial intelligence-powered infrastructure. By emphasizing both core infrastructure services (such as security and settlement) and newer build directions (including AI infrastructure), BitGo is signaling that it wants to consolidate headcount while potentially scaling specific capabilities.
How many roles could be affected
BitGo did not confirm the exact number of employees impacted. However, the firm’s 2025 annual report—published in March—listed 603 full-time employees as of Dec. 31, 2025. If the workforce reduction matches the “nearly 15%” figure, the impact could plausibly be on the order of about 90 employees.
Belshe characterized the cuts as “a one-time action” and said BitGo does not “anticipate further reductions.” That matters for employees and investors alike: it suggests the company intends to reset capacity once rather than continue trimming on an ongoing basis, even as it reallocates resources to the priorities outlined in the announcement.
Hiring continues even as company reduces headcount
While announcing layoffs, BitGo also indicated it is still looking to hire. Its job board lists 51 open roles across multiple regions, according to the posting referenced in reporting. That creates an important tension investors will likely watch: reductions in one part of the organization paired with continued recruitment in others.
For builders and candidates, the implication is that BitGo may be reshaping teams rather than retreating from growth entirely. For market participants, the bigger question is whether the layoffs are mainly operational efficiency in a down cycle—or whether they signal that BitGo sees near-term demand specifically for the capabilities it highlighted, such as AI-enabled infrastructure and stablecoin-related services.
Broader industry backdrop: cuts spread across crypto
The BitGo layoffs arrive amid a wider wave of job reductions across crypto firms in 2026. Reporting cited that companies in the sector have cut more than 5,000 jobs so far this year, with many pointing to a combination of efficiency improvements—often attributed to AI—and a broader market slump.
Examples referenced in the coverage include:
- Block Inc., which cut around 4,000 jobs (about half its workforce) in February, according to earlier reporting.
- Robinhood, which cut 10% of its workforce on June 16, as previously reported.
- Kraken’s parent, Payward, cutting 150 staff in May, according to earlier coverage.
- Dune, which reduced staff by 25% in May.
- Coinbase’s reported reduction of 700 employees (about 14% of its workforce).
- Gemini, which laid off 200 employees earlier in the year, and Crypto.com, which reportedly cut about 180 staff, with both citing rising AI use.
The piece also pointed to broader US technology layoffs, noting that over 121,500 layoffs from more than 200 companies had occurred so far in 2026, according to Layoffs.fyi. This context frames BitGo’s actions as part of a larger labor realignment across the tech sector—not solely a crypto-specific adjustment.
Market reaction and what to watch next
BitGo’s stock fell after the announcement, closing Thursday down 4.67% at $4.80, extending a nearly 73% decline from its public debut at $18 on Jan. 22, according to reporting and market data from Google Finance.
Going forward, the key items for readers are whether BitGo can turn the restructuring into measurable progress in the areas Belshe named—especially security, stablecoins, and AI-driven infrastructure—and whether the “one-time” nature of the layoffs holds. In an environment where many crypto firms are still trimming costs, investors will likely look for signs that the company’s resource shift translates into stronger execution rather than simply further consolidation.
Asset manager 21shares has scaled back several of its bullish forecasts for the crypto industry this year, saying institutional adoption continues to strengthen even as weak market conditions and muted retail participation have slowed the pace of growth.
In its midyear outlook, the asset manager said the industry’s underlying infrastructure has advanced more quickly than prices. Areas such as exchange-traded funds (ETFs), stablecoin regulation, tokenization and prediction markets have continued to mature, but weaker crypto prices, major DeFi exploits and slower-than-expected enterprise adoption have pushed several of its 2026 targets out of reach.
One of the report’s clearest conclusions was that Bitcoin’s (BTC) four-year market cycle remains intact, despite signs the asset class is becoming more institutionally driven.
“After peaking at around $126,000 in October 2025, Bitcoin pulled back sharply and has continued to trade in line with prior post-halving patterns,” the analysts wrote, arguing that institutional ownership has softened market drawdowns but has not fundamentally altered Bitcoin’s cyclical behavior.
Bitcoin’s predictable four-year cycle continues to be a major driver of market conditions. Source: 21shares
Former 21shares co-founder Ophelia Snyder, who departed the company following its acquisition by FalconX in 2025, recently made a similar observation about how institutional investors have reshaped crypto markets.
“The investor base is larger, more institutional, and more connected to the broader financial system,” Snyder wrote in a recent Substack post. “As a result, competing narratives, geopolitical developments, and macroeconomic shifts all have a much larger impact on crypto pricing than they once did.”
Prediction markets expected to outperform
Among the sectors outperforming expectations, 21shares singled out prediction markets as one of crypto’s strongest growth areas, projecting annual trading volume will surpass $100 billion this year.
The report also highlighted consolidation as a defining trend across the industry. Public companies holding crypto on their balance sheets are beginning to diverge, with many smaller treasury players trading below the value of their digital asset holdings, pointing to further consolidation in the sector.
A similar pattern is emerging across Ethereum’s layer-2 ecosystem, where a handful of dominant rollups continue to gain market share while dozens of smaller networks struggle to attract meaningful users and liquidity.
Related: Bitcoin miners need billions to fund AI ambitions, led by IREN’s $21B gap
Crypto ETFs show resilience despite outflows
That resilience is also evident in crypto exchange-traded products, which have continued attracting long-term institutional investors despite weaker market conditions.
While US spot Bitcoin ETFs have recorded roughly $3 billion in net outflows this year, 21shares said those figures don’t tell the full story. Holdings remain just above 1.25 million BTC, near an all-time high in for the token, suggesting many investors have held onto their positions through the downturn.
“Investors are holding through volatility or quietly building strategic positions, even with Bitcoin trading well below its highs,” the analysts wrote.
Crypto ETP assets have fallen from their peak, but cumulative investor inflows have remained resilient. Source: 21shares
The analysts also pointed to improving regulatory clarity in the United States, citing the Securities and Exchange Commission’s generic listing standards that have helped convert a backlog of crypto ETF applications into a steady stream of new product launches beyond Bitcoin and Ether.
“Hyperliquid stands out,” the analysts wrote. “US spot ETFs tracking the asset attracted over $150 million in net inflows in under a month, evidence that traditional capital continues to flow toward digital assets.”
Related: CBOE weighs converting BTC, ETH continuous futures into perpetual futures: Report
Bitcoin’s drop below $60,000 has triggered nearly $1.48 billion in crypto liquidations after fresh U.S. inflation data reinforced expectations that interest rates could remain higher for longer.
Summary
- Bitcoin’s drop below $60,000 triggered $1.48 billion in crypto liquidations, with long traders suffering the biggest losses.
- A $9.33 billion Bitcoin options expiry and rising inflation concerns have added to volatility across crypto markets.
- Stronger U.S. inflation, ETF outflows, and Strategy’s stock decline have reinforced expectations of higher interest rates.
According to data from crypto.news, Bitcoin (BTC) fell 3.3% to an intraday low of $58,188 on June 25 before recovering to around $59,200 at press time. Ethereum (ETH) declined 4.7% to $1,567, while XRP dropped 3.7% to $1.03. The total cryptocurrency market capitalization also fell 2.2% to $2.13 trillion.
According to CoinGlass, more than 217,700 traders were liquidated over the past 24 hours, with total losses reaching approximately $1.48 billion. Long positions accounted for $1.21 billion of those liquidations, while short traders lost about $270 million. Bitcoin led the selloff with roughly $665 million in liquidations, followed by Ethereum at $359 million and XRP at $50.5 million.
Derivatives positioning keeps volatility elevated
Alongside the spot market decline, traders are preparing for one of the largest Bitcoin options expiries of the year. Data from Deribit shows roughly $9.33 billion in Bitcoin options, representing 157,611 open contracts, are scheduled to expire on Friday.
Call open interest is concentrated between the $75,000 and $90,000 strike prices, while put positioning is clustered across the $20,000 to $70,000 range. Deribit’s max pain price stands at $72,000, well above Bitcoin’s current market price. With Bitcoin trading far below the largest call positions, options traders could continue adjusting hedges into expiry, increasing short-term price swings.
Meanwhile, XRP derivatives remain tilted toward bullish positioning despite the broader selloff. CoinGlass data shows Binance XRP traders maintained a 2.53 long-to-short ratio, while OKX traders posted a 2.68 ratio, suggesting many participants are still positioned for a rebound. However, such crowded long positioning can increase liquidation risk if selling pressure persists.
Offering a longer-term perspective, analyst Daan Crypto Trades said he sees the green support zone on his chart as an area to gradually accumulate Bitcoin rather than trying to identify the exact market bottom.
He added that the weekly 200-week moving average has historically provided attractive value and said he remains comfortable accumulating in the $60,000 region, even though he believes lower prices remain possible during 2026.
Meanwhile, fellow analyst Lennaert Snyder said he had already taken profits on most of his Bitcoin short position following the latest breakdown.
“If we’re printing new lows I’m eyeing 55K for a reaction, but even the 40s are fine with me.”
Inflation data reinforces higher-for-longer outlook
According to the U.S. Bureau of Economic Analysis, the Personal Consumption Expenditures (PCE) price index increased 4.1% year over year in May, up from 3.8% in April, while headline PCE rose 0.4% on a monthly basis.
Although both readings came in slightly below economists’ expectations of 4.2% annually and 0.5% monthly, inflation remained more than double the Federal Reserve’s 2% target.
The report also showed core PCE increased 0.3% during the month and 3.4% from a year earlier. At the same time, the BEA reported that personal income rose 0.7%, while real consumer spending increased 0.3%, suggesting the U.S. economy remains resilient despite elevated borrowing costs. First-quarter GDP growth was also revised upward to 2.1%.
The inflation data arrived as institutional demand for Bitcoin continued to soften. U.S. spot Bitcoin exchange-traded funds have recorded roughly $6.4 billion in net outflows over the past 30 days, the largest monthly redemption period since the products launched. Pressure has also spread to equities, with Strategy shares falling more than 12% below $100, coinciding with Bitcoin’s break under $60,000.
Prediction markets have also turned increasingly cautious. According to Polymarket, traders are assigning a 66% probability that Bitcoin falls below $50,000, while the odds of a decline below $45,000 have risen to 46%.
Adding to those concerns, Bank of America recently revised its outlook and now expects three Federal Reserve rate hikes this year, replacing its earlier expectation that policymakers would keep rates unchanged.
Disclosure: This article does not represent investment advice. The content and materials featured on this page are for educational purposes only.
For the past two cycles, Bitcoin DeFi has lived more as a promise than a category.
Programmable Bitcoin has remained a vision held by a certain breed of Bitcoin maxi who believes that the world’s largest cryptocurrency can become productive without losing its security or sound money qualities.
Yet the closure of Bitcoin scaling platform Botanix earlier this month has called that vision into question.
If a well-funded, technically ambitious Bitcoin layer-2 with live apps, integrations and competitive yields can’t attract enough usage to survive, does that mean Bitcoiners simply don’t care about decentralized finance?
Bitcoin DeFi remains a niche proposition in 2026, despite years of being touted as the next big thing.
DefiLlama’s dashboard shows just $4.12 billion of total value locked (TVL) across all of the Bitcoin DeFi protocols. That’s a rounding error next to Bitcoin’s $1.2 trillion market cap, and the hundreds of billions held via spot exchange-traded funds, corporate treasuries and custodial accounts.
Andre Dragosch, head of research Europe at Bitwise, told Cointelegraph, “Bitcoin is winning decisively as a monetary asset and as pristine collateral, but the case for Bitcoin as a standalone DeFi execution layer was always structurally weaker than the narrative suggested.”
Botanix closes after four years
When Botanix announced it was winding down after nearly four years of work and a year of mainnet uptime, the team didn’t blame a hack or a regulatory shock; they blamed demand.
Botanix described a chain that “worked” in every technical sense: 25 million transactions, 200,000 wallets, and tens of millions of dollars in bridged funds, yet it never generated the fee volume needed to cover its infrastructure costs.
Users came for the yield, treated BTC as store-of-value collateral, and then largely stuck to passive, buy-and-hold strategies, rather than actively borrowing, trading, or moving funds often enough to generate meaningful fee volume.
Related: Fireblocks to integrate Stacks for institutional-grade Bitcoin DeFi
Like most BTCFi stacks today, Botanix still requires users to bridge their Bitcoin into a tokenized version on a separate Ethereum Virtual Machine (EVM)-based chain before they can access DeFi. That introduces additional bridge and smart contract assumptions that worry many Bitcoiners.
Botanix’s shutdown notice. Source: Botanix
Even so, Botanix co-founder Willem Schroé told Cointelegraph that he wouldn’t have changed the core design. Despite Botanix offering what he described as “the best rates in the industry” and a more Bitcoin-aligned security model than typical wrapped BTC bridges, wrapped BTC on Ethereum still out-competed Botanix.
He attributed that to Ethereum’s “huge infrastructure network and Lindy effect,” as well as a mix of liquidity depth, user experience and regulatory comfort.
What Botanix learned about Bitcoin DeFi
The team concluded that Bitcoin is still viewed as a reserve asset rather than something that has programmable utility.
For most existing use cases like lending, leveraged exposure, or yield, a wrapped BTC position on a large, mature EVM ecosystem such as Ethereum is “genuinely sufficient” for most users. Rather than bridge into a Bitcoin-aligned EVM chain like Botanix, users preferred to stick with wBTC on venues where the liquidity, apps and integrations already exist.
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Botanix also pointed to onchain activity consolidating around venues like Hyperliquid, and major centralized exchanges and retail-facing fintechs that “own the user relationship,” leaving independent infrastructure “rowing upstream” against convenience and branding.
Wilhelm said he hopes Botanix’s wind-down “will definitely be looked at by others,” and framed the process as a professionally managed experiment whose lessons other BTCFi builders should take seriously.
Bitcoiners, DeFi and wrapped BTC
While estimates vary, only a small fraction of Bitcoin’s supply is currently productive in DeFi, and most of that sits in wrapped BTC products on Ethereum and its L2s like Base and Arbitrum, as well as Polygon, Solana and BNB Smart Chain. A smaller percentage is on “Bitcoin L2” chains, with Bitcoin-aligned L2s and sidechains accounting for a modest share of that activity by value.
Tokenized BTC products themselves represent just a sliver of the asset: A May 2026 analysis estimated that roughly $20 billion worth of BTC — less than 2% of the total Bitcoin supply — is circulating on EVM chains in wrapped form.
Total Value Locked (TVL) in Bitcoin DeFi. Source: DeFiLlama
An October 2025 GoMining survey of 730 Bitcoin holders found that 77% of respondents had never used a BTCFi platform, and only 3% integrated BTCFi into their overall Bitcoin strategy.
Even allowing for sample bias (these respondents were plugged-in, survey-answering BTC holders), the numbers show that BTCFi platforms that keep users in Bitcoin-aligned stacks remain a niche activity rather than a mass behavior.
Justin d’Anethan, head of research at crypto private markets advisory firm Arctic Digital, told Cointelegraph, “There is more liquidity and better yields on EVM or SVM [Solana Virtual Machine] native solutions than on BTC solutions, period.”
When clients ask about “putting their Bitcoin to work,” the practical routes, he said, are still centralized desks, exchanges lending out BTC at 2% to 4%, basis trade structures “à la Ethena,” or institutional credit pools like Maple.
Related: Bitcoin recovery meets DeFi tensions as Aave rift deepens: Finance Redefined
He said the big obstacle for most Bitcoiners was the risk of bridging to a less secure Bitcoin L2. For “hardcore BTC maxis,” the default remains cold storage, HODLing and riding price appreciation, rather than trying to “eke out 2-3% with counterparty risk.”
Native BTCFi as a structural mismatch
Dragosch said Botanix’s failure suggested that demand for standalone Bitcoin DeFi execution layers was much weaker than their backers expected.
He argued that capital that “genuinely wants yield has migrated to wrapped BTC on mature, liquid venues rather than bridging into bespoke federations.”
In this view, the problem isn’t just that Bitcoiners haven’t “discovered” native DeFi yet; it’s that the architecture and user base are misaligned. Bitcoin’s base layer is slow, conservative and firmly anchored in the store-of-value narrative.
“Bitcoin as reserve collateral is the durable trade,” Dr. Dragosch said, “the next leg of adoption runs through institutions and balance sheets, not necessarily through onchain execution layers.”
77% of respondents have never used a BTCFi platform. Source: GoMining
Who is still building BTCFi, and for whom?
Diego Gutierrez Zaldivar, chief executive of RootstockLabs, a Bitcoin-secured, EVM-compatible sidechain, doesn’t buy the idea that there’s “no demand” for Bitcoin-backed lending, yield products or broader BTCFi services.
He said the main constraint is trust: putting in place the operational, legal and risk management frameworks that institutions need.
More than 40% of all Bitcoin DeFi activity now runs through Rootstock, he said, including real-world asset settlements and institutional vaults. Over the past year, he said, funds have started asking to deposit hundreds or even thousands of BTC at a time into Rootstock-based products; flows that were almost unheard of two or three years ago.
Chains TVL. Source: DeFiLlama
Orkun Mahir Kılıç, co-founder of Chainway Labs, which is behind Citrea, a Bitcoin-anchored rollup combining the Bitcoin Virtual Machine (BVM) and zero-knowledge proofs, argued that cloning EVM DeFi primitives onto Bitcoin is a dead end, and said that Botanix’s experience is a verdict on that model, rather than BTCFi itself.
Orkun Mahir Kılıç is co-founder of Chainway Labs, behind Citrea, a Bitcoin-anchored rollup that keeps user assets inside Bitcoin’s security perimeter and proves its state with zero-knowledge proofs. He argued that cloning EVM DeFi primitives onto Bitcoin is a dead end, and said that Botanix’s experience is a verdict on that model, rather than BTCFi itself.
He told Cointelegraph that “more secure” doesn’t change most people’s behavior.
“People don’t price counterparty risk until something breaks,” he said. ”Where it matters” is for institutions and large holders that need trust-minimized transactions with no custodian to fail.
“For everyone else, the reason to be here isn’t the security guarantee in the abstract; it’s the applications that don’t exist elsewhere.”
Magazine: Bitcoin will not hit $1M by 2030, says veteran trader Peter Brandt
In 2022, Kraken began institutional cryptocurrency derivatives trading on PowerTrade, a company operated out of El Salvador and co-founded by Mario Gomez Lozada and Bernd Sischka.
In October 2025, when the price of bitcoin fell and markets declined, Kraken said it became concerned about PowerTrade’s liquidity and creditworthiness and tried to withdraw its funds, but was unable to, according to the filing.
Rather than returning the funds, the lawsuit claims that PowerTrade carried out a series of unauthorized transactions that moved Kraken’s account from holding more than $6 million to a negative balance of nearly $2 million.
This was done through a block of around 100 “corrections,” related to trades that had expired or settled months earlier, the filing said. Payward said in the filing that it was concerned that PowerTrade would rely on the “debt” it had artificially created to appropriate Payward’s bitcoin collateral.
PowerTrade did not respond to a request for comment by press time.
UPDATE (June. 25, 16:45 UTC): Updates amount of losses as per new filing, removes mention of DIFC freezing order
Jiang Zhuoer, one of China’s best-known bitcoin miners and founder of the LeBit mining pool, predicted that the current bear market will bottom in the fourth quarter at roughly $42,000-$44,000.
The forecast, made in Chinese on X, puts the low some 30% below bitcoin’s current level near $60,700, and rests less on the cryptocurrency’s performance than on Strategy, the largest corporate holder of the token, according to an automated translation.
Jiang analyzed Strategy’s market net asset value (mNAV), the ratio of the company’s stock price to the per-share value of the bitcoin it holds, which has dropped to 0.72. A number above 1 means investors value the company at a premium to its bitcoin stack; below 1 means they value it at less.
Jiang’s figure has the market pricing Strategy about 28% below the bitcoin it owns, a sign of deep pessimism toward the trade.
《对本轮BTC熊市 见底时间&价格 预测》
【重要长期预测贴】MSTR的mNAV已跌到0.72了【图1，图3】，
（mNAV=股价/每股含BTC价值 比值，代表美股资金对MSTR的市场情绪，高于1为泡沫高估，低于1为悲观低估）
接近上一轮牛市2022年5月11日的最低点0.7【图2】。
根据最近STRC大幅脱锚等市场情绪事件，… https://t.co/V5s0Q2S2Wy pic.twitter.com/o9fqE9U80z— 江卓尔_莱比特矿池 (@Jiangzhuoer2) June 24, 2026
That reading is close to the 0.7 low Strategy hit on May 11, 2022, during the last bull-to-bear turn, he said, which leads him to think mNAV is near its floor for this cycle.
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