Remember those carefree, innocent days when all the talk was of the US’s strategic Bitcoin reserve and tariffs were just a twinkle in Trump’s eye? Life sure does come at you fast sometimes.
But, amid all the tariff-induced chaos currently convulsing the markets, we shouldn’t forget just how momentous this move to create a strategic reserve was. BTC’s status as an asset has been endorsed and indeed legitimised by the most powerful government on earth: a government which has also been charged with accumulating more of it, albeit at no cost to the US taxpayer.
So, the question becomes: how does Uncle Sam stack more sats without buying them on the open market? And what about the not-so-small matter of the US’s growing mountain of debt? Well, it looks like there could be an answer to this two-headed conundrum: Bitcoin bonds.
In today’s video, we dive into what Bitcoin bonds are, how they might work and why investors might be tempted to ape in. Could this be the way for the US to address its debt problem, stack more BTC and pump our bags all at the same time?
You can watch that video here.
📈 Crypto Market Forecast 📈
The macro is still cloudy, but there are signs of sun on the horizon. For starters, the CPI for March came in much lower than expected last week. Although this wasn’t bullish for prices in the short term due to the otherwise bearish backdrop, it nonetheless increases the chances that the Fed will lower rates in the coming months, and could even foreshadow continued drops in inflation.
The otherwise bearish backdrop in question is the uncertainty around tariffs, which has narrowed to the emerging trade war between China and the US. All other countries have had their tariffs reduced to 10%, a margin which could be offset by falling energy prices, and companies stockpiling inventories ahead of the tariffs going into force, at least in the short term.
What happens in the longer term is what has investors so uncertain. Besides the fact that this 10% tariff will only be in place for 90 days, the 145% tariff on China has no end date at the time of writing. What everyone is wondering is who will blink first: Trump, who has nothing to lose; Xi, who has a lot to lose; or Powell, who has comparatively less to lose (his reputation).
The consensus view is that Trump will be the first to blink, with many media outlets claiming that he implemented the 90 day tariff ‘pause’ as a result of bond market volatility. However, other media outlets claim that bond market volatility was not the reason for the pause. Whatever the case, the fact that the tariffs on China are still in full force suggests nobody has truly blinked yet.
It’s also important to remember that there was another headwind markets were facing recently: tax season. For context, US taxes are due this Tuesday, April 15th. Many analysts have pointed out the fact that taxes will result in a short-term liquidity drain, especially since last year’s capital gains were so large. The end of tax season could therefore foreshadow a slow recovery.
Not only that, but this short-term liquidity drain will be offset by the Treasury General Account. That’s because all taxes collected go into the TGA, which has been spending this money quickly as a result of the debt ceiling being hit in January. We should see tax revenues reflected in the TGA this week, and then see them reinjected into the economy in coming weeks.
Assuming the macro backdrop starts to improve, then crypto catalysts could start to matter again. In case you haven’t noticed, the stars have been aligning on that front, and the latest one to line up is the approval of Paul Atkins as SEC chair. This should allow the SEC to operate more effectively, and continue in its pro-crypto activities, such as striking down crypto lawsuits.
On that note, everyone seems to have missed the news that Trump has formally scrapped the IRS’s broadened definition of ‘broker’, which targeted DeFi protocols. The practical effect of this should be more DeFi activity in the US, which is significant given that the US is the largest jurisdiction in terms of crypto flows. However, it seems that more clarity is still required.
Evidence for this can be seen in OpenSea’s recent request to the SEC to clarify rules around NFTs. This is extremely significant given that NFTs are critical to crypto niches such as GameFi and SocialFi. As such, regulatory clarity around NFTs could set the stage for these and other similar crypto niches to enter the spotlight, something which hasn’t happened yet.
More importantly, clarity around NFTs could also result in web2 integrations. Everyone seems to forget how Instagram temporarily added support for NFTs back in 2022. These kinds of web2 integrations could return in size, especially if there’s additional clarity around things like DeFi. But again, if the macro backdrop continues to be uncertain, it may not impact prices very much.
In sum then, it seems that the worst of the tariff FUD is over, but it’s not completely gone by any means. Bullish tailwinds like falling inflation and tax season being over could be supportive of the markets around the margins over the next few weeks, but the fact of the matter is that there will not be a meaningful recovery until someone blinks in the China tariff talks. Place your bets!
💲 Yield-Bearing Stablecoins💲
Yield-bearing stablecoins, a crypto primitive that was incredibly popular in 2024, is beginning to show signs of a return to the spotlight in recent weeks. This is evidenced by some recent product launches, fundraises and institutional interest.
In just the past 3 months, we’ve seen:
- a former Tether CEO announce the launch of Pi Protocol, a yield-bearing stablecoin protocol.
- Figure Markets introduce YLDS, the first yield-bearing stablecoin registered as a security with the US SEC.
- Cap, another yield-bearing stablecoin protocol, raise $8 million in funding from big-name financial institutions, including Franklin Templeton and Triton Capital.
Not to mention, JPMorgan analysts recently forecast that yield-bearing stablecoins could rise from their current 6% to as much as 50% of the stablecoin market cap in the future. This forecast is in line with recent growth trends exhibited by yield-bearing stablecoins. For instance, a AQN Digital report shows that the market cap of these particular stablecoins has grown nearly 5x since September 2024, while total stablecoin supply saw a modest 30% growth over the same period.
This is notable, especially when you take into consideration the tempered growth and fall in yields offered by leading yield-bearing stablecoin issuers like Ethena since January 2025. The market share resilience of yield-bearing stablecoins, despite broader market volatility, hints at market conviction on their long-term growth as a prominent crypto primitive.
After all, yield-bearing stablecoins enable more capital-efficient DeFi strategies. For example, users can stack yield while using them as collateral when borrowing in DeFi protocols like Aave. They also break down jurisdictional barriers, allowing users worldwide to earn yields typically reserved for US investors, such as those from T-bills. This global accessibility is a promising USP in addition to offering passive yield on idle stable-value assets.
The sheer variety in yield sources among different yield-bearing stablecoin protocols also ensures that investors can choose yield sources that align with their risk appetite. This makes these stablecoins a versatile tool for portfolio diversification and hedging. On that note, depending on their yield source, these stablecoin protocols can be broadly classified into two brackets: DeFi-native yield-bearing stablecoins and Real-World Asset (RWA)-backed yield-bearing stablecoins. Both come with their own set of risks and opportunities.
DeFi-native yield-bearing stablecoins, which includes the likes of sUSDe (Ethena) and slvlUSD (Level), have been the more popular variety recently. These protocols generate yield by employing DeFi strategies such as delta-neutral perp trades, and supplying liquidity on lending protocols like Morpho, Aave, and Compound. For instance, Ethena’s USDe maintains its peg stability through an automated delta-neutral hedging strategy that involves opening short perpetual futures positions against its reserve collateral. Its staked yield-bearing variant, sUSDe, generates yield from these short perpetual futures positions, which collect funding rates on exchanges. Level’s slvlUSD generates yield by depositing USDC and USDT into Aave to earn lending interest. It then restakes the receipt tokens on Symbiotic for additional returns.
That said, the primary risk with DeFi-native yield-bearing stablecoins stems from the systemic risks tied to the underlying protocols employed in their yield strategy. (For example, smart contract vulnerabilities, slashing risks on staking yield, etc.) They are also dependent on market sentiment, since bullish markets drive higher borrowing demand (higher returns) and vice versa. Newer entrants like Cap’s cUSD attempt to hedge this risk by creating decentralised lending markets for institutional borrowers.
On the other hand, RWA-backed yield-bearing stablecoins like USDY (Ondo) and USDM (Mountain), tap into TradFi yields by investing in assets like short-term US Treasury bills. While these stablecoins typically offer lower yield rates when compared with DeFi-native yield stablecoins, they offer reliable and stable yields. The primary risk with this model is its reliance on centralised counter parties. Not to mention, these stablecoins often lack deep integrations with DeFi lending and borrowing protocols.
That said, there are also protocols that take a hybrid approach by combining both yield sources. These include Sky’s sUSDS and CoinShifts’s csUSDL, which generate yield through a mix of RWA and DeFi strategies. Another example is Binance’s LDUSDT, a reward-bearing margin asset which offers up to 5% APY for margin traders.
That said, the most important factor that will determine the future of these yield-bearing stablecoins is the upcoming stablecoin regulation in the US. While initial drafts have been silent on their regulatory treatment, the grey area provides space for innovation to flourish. In the meantime, yield-bearing stablecoins are one of the best-positioned crypto primitives to bet on when bullish sentiment returns. We suggest you keep a close eye on this space.
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🔮 Video Pipeline 🔮
* Taiwan: Should we be worried about China’s 2027 invasion deadline?
* Crypto Holders: Who holds, how they use it and what that means for the markets?
* Stagflation: What is it and what does it mean for crypto?
* Digital EUR Update: They want to track everything!
* Crypto Macro Catalysts: What could drive crypto markets higher?
* Insider Trading? What’s happening in the US?
* Trump Tariff Update: What it means for us all?
🏆 What's New at CoinBureau.com This Week? 🏆
* Kraken Wallet Reviewed: A Closer Look At Features & Security
* Selling Pi Coin: Platforms, Cash-Out Methods & Tips
* Understanding AI Crypto Wallets
* How Safe Is Kraken in 2025? A Complete Security Breakdown
* Best Sonic DApps in 2025: Lending, Trading, Staking & Yield Farming
* Exploring MetaMask: Still the Top Ethereum Wallet?
📖 Quote of the Week 📖
It’s amazing that even in these incredibly volatile and uncertain times, people are still trading the crypto market with leverage and getting liquidated. Just keep calm and hodl on.
“The desire to perform all the time is usually a barrier to performing over time.” - Robert Olstein
Team Coin Bureau
Disclosure: Authors may own cryptoassets named in this newsletter. These are unqualified opinions, and a Coin Bureau newsletter, is meant for informational purposes only. It is not meant to serve as investment advice. Please consult with your investment, tax, or legal advisor.
The Coin Bureau Editorial Team are your dedicated guides through the dynamic world of cryptocurrency. With a passion for educating the masses on blockchain technology and a commitment to unbiased, shill-free content, we unravel the complexities of the industry through in-depth research. We aim to empower the crypto community with the knowledge needed to navigate the crypto landscape successfully and safely, equipping our community with the knowledge and understanding they need to navigate this new digital frontier.
