Global Digital Asset Market Insights for Q4 2025: Bitcoin Yield, Stablecoin Investment Solutions, and TradFi Strategies

Here are insights Figment is observing across global digital asset markets, in and beyond staking. Christoph and Eva share a global perspective on where industry attention is shifting, particularly toward the digital asset yield strategies that are currently dominating conversations.

1. Pursuit of Bitcoin Yield is the Market Obsession and Debate
2. Some DATs are trading below NAV: where do they go from here?
3. Perpetual DEXes and Hyperliquid’s trailblazing
4. Yield aggregators, the race is on
5. Stablecoins diversify from payments to investment-like instruments
6. BlackRock’s IBIT is a gateway to TradFi Bitcoin adoption
7. Staking has fully crossed over to TradFi

1) Pursuit of Bitcoin Yield is the Market Obsession and Debate

Institutional Bitcoin adoption is off the charts, and with that comes pressure to generate yield on Bitcoin. Significant expectations for native Bitcoin yield are being created by different types of market participants, deploying different yield generation strategies. Three dominant strategies currently define the BTC yield market: BTC lending, call overwriting, and BTC staking.

Bitcoin Lending: The Traditional Approach and Today’s Reality

• Bitcoin lending, the traditional yield generation avenue, has made a notable comeback after the collapse of major lending desks in 2022. The market, though healthier, remains structurally constrained with two major players dominating. The largest lending desk is running roughly a 5x-sized loan book vs. its next competitor. 
• Bitcoin loans can be used as a means of stablecoin adoption, targeting BTC borrowers looking for stablecoin supply. 
• An imbalance between those looking to lend Bitcoin and those borrowing it depends on market hours; Asian hours tend to see higher demand for providing financing, while U.S. market hours see an excess demand for BTC borrowing.  
• Rates have compressed significantly since Q2-2025, when longer-dated BTC loans fetched up to ~6% yield, which reflects the surge in BTC supply chasing yield. 
• Nowadays, around 1.5% on the short end to 4% for longer-term BTC provision can be achieved with leading lending desks, leaving BTC investors looking for alternative or complementary sources of yield.

Options-Based Yield: Call Overwriting

Sophisticated iterations of the call overwriting strategy – selling call options against Bitcoin held – emerged as the most discussed yield tactic at Token2049 in Singapore. Some participants presented backtests claiming up to 20% p.a. native yield, a figure that others dismissed as hard to achieve in practice, given persistently low volatility conditions that have prevailed for months, prior to the sudden sell-off on Friday, 10 October.

• Bitcoin’s implied volatility has gone down significantly in recent years: BTC volatility was at historic lows in early October 2025, despite the massive rally since April. This highlights the amount of volatility selling going on, as well as the increase in institutional adoption and maturation of the asset overall. Even the October 10th spike barely gets Bitcoin back to levels seen earlier in the year and is a far cry from the 2021/22 bull-market and post-FTX. For context, Tesla (TSLA) now trades at a higher implied volatility than BTC.

• Declining volatility reduces option premia, forcing sellers to sell (“write”) options with strikes closer to the at-the-money level to achieve a desired yield, increasing the risk of exercise during bull runs or sharp upward price movements. Rolling up the option’s strike or extending its expiry to avoid exercise is possible, however, this tends to be costly, impacting performance.
• Sophisticated option structures are an alternative and different iterations are being implemented. Figment and Two Prime entered into a partnership in August. Two Prime uses multi-legged option strategies, limiting potential losses and maximising returns.

BTC Staking

With Babylon, Stacks, and Core already supporting BTC staking, BTC staking on Starknet was launched right before Token2049 Singapore. BTC staking on Starknet lets users stake wrapped Bitcoin on Ethereum Layer 2 to earn yield through DeFi. 

2) Some DATs Are Trading Below NAV: Where Do They Go From Here?

Numerous DATs covering a range of major blockchains are launching or have launched. While there are many promising projects out there, the key issue emerging is that some DATs are trading below NAV.

• The justification for a DAT to trade above NAV hinges on its ability to outperform passive tracking products (ETFs), rather than purely offering market access for TradFi investors.
• A DAT does not need to meet redemptions like an ETF, so there is more treasury management flexibility, but also an illiquidity premium that investors demand. ETFs are better than closed-end funds; therefore, DATs will have to be better than ETFs to be successful with mainstream TradFi investors.

Active treasury management strategies play a key role in outperforming ETFs and staking near 100% of the treasury is emerging quickly as the go-to strategy, prior to adding yield generation strategies as a diversifier. 

The Crypto Considerations:

Contributing in-kind to DATs to generate a direct valuation uplift has been popular in 2025. Convincing an investor to contribute in-kind at sub-NAV and additionally taking the illiquidity vs. holding major tokens outright, is a difficult pitch for raising capital. Hence staking or yield generation strategies, demonstrating outperformance vs. holding the token outright, are key.

The TradFi Considerations: 

DATs need to tap capital markets meaningfully to copy the Michael Saylor playbook, i.e., they likely need to reach $3-$5 Billion in market capitalisation to access the convertible bond and other financing markets. The pitch of creating a “permanent capital crypto investment vehicle” may soon not be enough for TradFi investors.

We may see consolidation in the next 6-12 months, where larger DATs capable of generating meaningful return on their digital asset treasury and hence driving the narrative with investors will continue to trade above NAV, providing shareholder value and acquiring smaller DATs trading below NAV, unlocking further shareholder value.

3) Perpetual DEXes and Hyperliquid’s Trailblazing

There is a lot of talk on perpetual DEXes. Hyperliquid started this trend, and there is heavy conversation about Aster and Lighter, as well as other recently launched or soon-to-launch projects. While it seems many major chains will have one (or more) perpetual DEXes, it will be interesting to see where liquidity grows and consolidates – especially after airdrops that skew liquidity short-term.

Crypto liquidity is already widely spread, and large centralized exchanges are extending free credit to frequent traders to keep volumes flowing. Hyperliquid dominates the perpetual DEX space for now, yet competition is heating up and time will tell if other DEXes will be able to snatch market share from CEXes and Hyperliquid, particularly given Hyperliquid’s strong performance during the October 10th sell-off, where the platform appeared to be working as expected, without major incidents being reported to date  

Key Participants in the Perpetual DEX Space

4) Yield Aggregators Race is On

Morpho crystallized demand for smarter credit routing and matching capital with DeFi lenders’ demand for yield; now we’re seeing platforms that aggregate yields across on-chain credit, basis trades, restaking, and even off-chain structured payoffs – abstracting protocol risk behind policy engines and controls.

The direction of travel is toward “one interface, policy-driven allocation” that hops across sources (tokenized T-bills, centralized credit, other yield-bearing strategies) based on defined risk budgets and drawdown limits.

Several teams are effectively building a “central exchange for yield”- combining custody, margin, and marketplace plumbing-while others remain pure smart-contract routers with auditability and permissioned lists. Yield aggregators are primarily focused on the retail audience; it remains to be seen if institutional players will adopt them.

5) Stablecoins Diversify from Payments to Investment-Like Instruments

Different stablecoin users and usage types are driving the stablecoin demand from different angles. As policy firms up, expect a split between regulated, fully reserved payment coins and yield-bearing/synthetic instruments sitting closer to investment products than traditional stablecoins.

• Market structure
  • The stablecoin market has surged to an all-time high of almost $300 billion, with growth accelerated by clearer U.S. regulations. 
  • Market participants now view stablecoins as engines of net dollar-demand creation rather than de-dollarization threats, projecting over $1 trillion in incremental USD demand in the coming years.
• Product mix
  • Synthetic “yield-bearing dollars” crossed the $10 billion threshold, broadening the definition of “stable value” instruments and highlighting the importance of yield in the digital asset adoption, yet again.
  • Payments-oriented stables (e.g., PYUSD) are leaning into merchant acceptance and mass-payout use cases. 

6) BlackRock’s IBIT is a Gateway to TradFi Bitcoin Adoption

Major banks still cannot book Bitcoin on their balance sheets. Recognizing client demand, they instead offer IBIT-linked products (IBIT is an exchange-traded product that provides exposure to Bitcoin in a regulated, familiar ETF investment wrapper).

• BlackRock’s IBIT exceeds $100 billion AUM, and as of the writing of this piece, IBIT options open interest exceed Deribit’s. 
• A major U.S. investment bank started offering Bitcoin structured products using IBIT options.

Family offices echo the same theme: setting up true digital-asset custody/booking across banks/traditional custodians remains high-friction, complex, and not viable. 

• Adding 3-5% IBIT to the portfolio is simple, clean, and an even hotter topic now, after the recent sell-off. 
• Meanwhile, some VC funds have underperformed Bitcoin over the past three years. Result: Many family offices take exposure via IBIT and related ETFs, rather than funding the next round of venture tickets. Institutional adoption is not chasing alts; it is focusing on majors. 

The consequence, in pockets of the TradFi market, is a form of crypto adoption without direct token ownership. TradFi clients gain exposure without holding digital assets on the balance sheet, underscoring the core issue that still persists: the plumbing of digital assets remains low with TradFi. It is easier for certain investors to trade IBIT or other ETFs (or derivatives on them) or DATs than to hold tokens directly. With the announcement of major US investment banks providing digital asset custody services, this may change in 2026.

7) Staking Has Fully Crossed Over to TradFi

Within the next 3 months major institutional players will adopt staking as part of their investment activities, offering it to millions of clients, as ETF and ETP staking goes mainstream. Grayscale announced SOL and ETH ETF staking, powered by Figment. Other products to follow suit in short order and new SEC listing guidelines will allow many types of ETFs to launch without the complex 19b4 and S1 listing process.

It’s not just the fact that new ETFs/ETPs are launching, but the wealth managers who advise clients on portfolio strategies are opening and allowing all clients to hold crypto funds in their portfolios. For example, Morgan Stanley, one of the world’s largest wealth management firms with $6.5 trillion AUM across their wealth and investment management divisions, will remove an account restriction and allow their advisors to recommend crypto ETFs/ETPs, including those with staking, to all wealth management customers globally.

It is undeniable that staking has reached an inflection point in institutional adoption: not staking is no longer an option for major digital asset investors; staking remains one of the most conservative ways of generating rewards in digital assets.

Please reach out to Christoph Richter, Eva Lawrence, or the broader Figment team if you would like to discuss any of these institutional trends globally or in specific markets. Figment is the largest independent staking provider with over $18 billion in AUS, working with institutions across the EMEA, MENA, APAC, North America, and LatAm regions. We continue to invest in on-the-ground support and local expertise in regions globally as staking strategies evolve and become further embedded in digital asset markets.

The information herein is being provided to you for general informational purposes only. It is not intended to be, nor should it be relied upon as tax, legal, business, or investment advice. This information is accurate as of 14 October, 2025, and Figment undertakes no obligation to update the information herein.