7 Things To Do With Your $100,000 Bitcoin

BTC is currently at $84,500.

Following the Trump presidential news, we’ve seen risk on assets, especially crypto assets skyrocket, with BTC leading the charge, a 26% upwards move in just a week.

Wall Street is max bidding with recent ETF inflow days of over $1b+, global liquidity is increasing, interest rates are reducing, Michael Saylor continues to buy BTC with leverage and even countries are adding BTC to their balance sheets. In fact, BTC has even flipped the market cap of silver and is now a 10x away from gold.

With that in mind, assuming you’re a reader of my Substack, you likely bought some crypto assets, potentially some BTC and are sitting on your hands with some. It’s likely to be sat there in a wallet or a CEX account and so the question I’m posing to you today is:

What do you do with your BTC?

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Sometimes nothing is better, but we don’t do that here.

The honest answer for most is nothing, just sit on it and leave it until it hits your target, $90k, $100k, $120k, $150k, $250k, whatever it is, I’m sure you have some number in your mind.

Some of you here however are a little more sophisticated, in fact, you guys can actually make your BTC work for you, earn some extra income and yield, make your Bitcoin your new employee.

Over the last 12-24 months, builders across the world have been developing and iterating on and around the BTC ecosystem. What used to be quite a boring asset has changed significantly because of the new uses for an asset like BTC.

That’s what we’re going to cover below:

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Here are 7 different things to do with your BTC to earn yield or additionally speculate 👇

First things first, we need to make sure you realise that:

A. Bitcoin is safest when nothing is done to it - just hold it in your wallet!

B. Risks include - blockchain risk, smart contract risk, depeg risk, collateral risk, slashing risk, unstaking penalties, oracle risks, trader risk, and many more. These are dependent on the exact strategy

C. Yields are not going to be 1000% Ponzi like, rather, we’re looking at more sustainable yields around 10-40% APY.

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BTC Staking

Despite being a proof of work asset, and therefore no access to the earning of block rewards through a stake like model, there are ways to utilise BTC in a manner through which can actually earn yield.
A variety of protocols as well as side chains and L2 chains on top of BTC have emerged that enable the staking of Bitcoin itself to help secure their networks. Some chains to do this are the likes of Core and Botanix. What’s more interesting to me is the emergence of the liquid staking layer thats arrived on top of this.
Protocols such as Lombard, Solv, Pump, pSTAKE and others have created new liquid staking instruments for BTC. These assets like LBTC, EBTC, SolvBTC etc, can be used across DeFi to earn additional yields. Some of these are also involved in restaking which we can cover below.

These assets, in addition, have a variety of yield components with each of these being different so therefore will have different risk reward elements too. As of right now, it is possible to earn double digit APRs through BTC staking.

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BTC Restaking

Following the rise of Eigen Layer for Ethereum, we now have the rise of Babylon leveraging the economic security of BTC and using it to secure new services that decide to opt in to the network. What this means is if you’re a new oracle or a new lending market or a cross chain DEX, you can use BTCs economic security to help secure your own network and this is significantly easier to set up than setting up your own new security from scratch.

Slashing conditions for events can be set to ensure that if something malicious were to happen, the BTC that is restaked can be used to help secure and avoid loss of funds. These services that opt in for extra BTC security are called AVS’s.

Babylon, as mentioned above, is the largest restaking network layer that is already drawing in tons of AVS’s to its network that it can then provide economic securty for through the BTC staked with Babylon.

As of right now there’s billions of dollars worth of BTC restaked, one for the possible yields but also for the juicy airdrops from Babylon itself and the various ecosystem partners once they launch their tokens. Whilst right now there isn’t real yield coming through restaking, there is speculation opportunity through Babylon which should have it’s airdrop sometime next year.

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BTC lending

Fairly straight forward and intuitive, BTC can be lent out on money markets like AAVE where users can earn yield for lending, but also access capital by being able to borrow against their assets.

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BTC LPing

Bitcoin itself can’t be used in DeFi, but wrapped BTC and other BTC like assets can be! Providing liquidity means depositing assets into a pool which traders can come across and access so they can do their swaps. They pay fees everytime to do swap actions and these go to you as a liquidity provider. Uniswap and Curve are two of the bigger DEXes today with BTC liquidity pools but there’s a wide range for you to choose from.

One thing I like to do at times is provide liquidity for correlated assets, so a BTC - BTC type pool which avoids you from loosing money form a concept called impermanent loss. Protocols like Pendle can let you do this with their PT tokens.

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PT Tokens

Talking about Pendle, it’s one of the largest derivative protocols in the space right now offering tokenised yield plus fixed rate interest through their PT tokens. This is akin to buying an asset at a discount and so you can buy BTC at a discount by purchasing their BTC PT tokens.

One of the great things here is you can use PT tokens on other protocols to increase your exposure to them too.

We’ve covered Pendle many times before so if you want to learn more go and check some of the other content on it!

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Option strategies

One of the most popular income generating strategies in finance is of course through selling options. There are many ways this can be done but a popular one is through selling cover call options.
This is a strategy in which you first buy spot BTC and then sell call options of an equal amount of that BTC. When selling options, the main idea is just to collect the premium so selling out of the money options can be a nice way to reduce risk here. Example:

• Bob buys 5 BTC (he’s a whale!)

• Bob then goes to an option exchange a sells 5 BTC OTM (out of the money) options and claims the premium

• As long as the price doesn’t go exponential in that time frame above your selected strike prices, you’ll earn yield and make money!

There are a variety of protocols you can do this on including Cega, Derive and in the not so distant future, IVX with 0dte options.

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Perpetual / Derivative liquidity

Perpetual exchanges are the most popular popular speculative instrument that exists today. One of the strategies to use your BTC for yield is through providing liquidity to perps markets like GMX, with their newer novel GM token model. There are other protocols that liquidity can be provided to however, these will contain some other elements including impermanent loss or USD exposure.

Finding single sided liquidity means no impermanent loss and full exposure to the asset itself with the additional benefit of fees.

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The above strategies all contain various degrees of risk and must be appreciated before utilising any of the above.

For the juicy part of what I’m specifically doing, read below 👇