Blockstream’s Bitcoin Lending Funds: Hold Your BTC & Earn More Without Selling a Satoshi!
The Bitcoin development firm Blockstream recently launched three investment funds, two of which will enable crypto lending. The launch includes Income Fund, Alpha Fund, and Yield Fund. The income fund is aimed at lending against BTC collateral. Alpha Fund will deliver risk-adjusted outperformance within the BTC ecosystem, focusing on portfolio growth. Yield Fund focuses on low-risk returns, avoiding BTC sell-off. With this, Blockstream has joined a handful of companies like Grayscale and Pantera in offering crypto-focused investment funds. According to Bloomerang, the Blockstream institutional-grade crypto-based investment solutions will go live on April 1, 2025. Let us explore the launches!
The Launch Plan
The demands of crypto institutional investors are ever-changing as the market is highly volatile. Blockstream has captured this market behavior and is poised to spur BTC-based innovations. It envisions paving the way for financial institutions to access the Bitcoin ecosystem. BTC purchases are expensive and too risky to access. It is far from the reach of a typical investor. Blockstream will address this issue by providing exposure to the Bitcoin markets. It will bridge traditional finance and Bitcoin ecosystems. With these efforts, Blockstream aims to build a world where Bitcoin is naturally part of the investment options.
Blockstream Income Fund: Stable Returns with BTC-backed Lending
The Blockstream income fund is built to lend against BTC collateral. It focuses on providing BTC-backed loans. This way, investors can earn a steady income and isolate themselves from the fluctuating BTC prices.
How does this work?
Blockstream uses an LTV approach to operate the fund. LTV stands for Loan-to-Value. It is a ratio between the borrowed value and the BTC value. In simple terms, it allows borrowers to borrow a portion of their Bitcoin value, similar to gold loans. Customers place their gold ornaments in gold loans as security, and in Blockstream Income Fund, it is BTC! The loan ranges from $100K to $5 million.
Blockstream Alpha Fund: Smart Strategies for Maximizing Bitcoin Profits
The Blockstream Alpha Fund works as a mix of investment strategies. Unlike passive BTC funds that wait for the prices to increase, this fund uses multiple trading strategies: Derivative trading, Basis trading, and event-driven trading, to name a few. Derivative trading involves buying and selling Bitcoin futures. Basis trading takes advantage of the difference between Bitcoin’s spot and the futures market. Event-driven trading is capitalizing on market fluctuations that could have been triggered by news or regulatory changes. Blockstream also plans to build its Alpha fund by operating Bitcoin infrastructure.
How can you earn Passive Income with Bitcoin Lending Funds like Blockstream?
Bitcoin lending funds generate returns by lending Bitcoin to borrowers in exchange for interest payments. First, investors will deposit BTC into the fund. The capital collected will be used for borrowing from institutional borrowers such as crypto exchanges and businesses. Borrowers repay the loan, and investors receive their returns based on the interest earned. These funds are highly beneficial to crypto investors. Investors can earn consistent interest payments. They can avoid selling their BTC possessions. Also, the risk involved is less as most focus on highly reputable borrowers. Above all, investors can diversify their portfolios, and the risks involved are less!
Key Insights: Brdiging Traditional Finance and BTC ecosystems
The launch of Bitcoin lending funds by Blockstream marks a significant step in integrating Bitcoin into institutional finances. The investment giant focuses on bridging the gap between the traditional finance and Bitcoin ecosystems. It achieves this by diversifying investment options and increasing access to the BTC ecosystems. The company offers three different funds: An income fund, an Alpha fund, and a Yield fund. The Income Fund and Alpha Fund work directly with the BTC-related ecosystems, while the Yield Fund has diversified variations and works across different domains. Whether investors seek stable yields, strategic growth, or diversified exposure, these funds present a compelling option. Blockstream’s Bitcoin-focused investment funds have the potential to redefine how institutions interact with Bitcoin, paving the way for broader adoption and financial innovation in the crypto space.
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The memecoin market has experienced a dramatic decline, losing over half of its value since December 2024.
Following a brief surge after Donald Trump’s presidential victory and the memecoin launches from both Trump and Melania Trump in January, the market capitalization has dropped from a high of $137 billion in December to just $54 billion as of March 2025.
This significant loss in value highlights ongoing volatility in the market, which has been further exacerbated by economic uncertainties, lack of regulation, and scandals surrounding insider trading. As a result, the memecoin market continues to be a highly unpredictable and speculative area within the broader cryptocurrency space.
Bitcoin ETFs record third straight day of net outflows led by Valkyrie’s BRRR
Spot Bitcoin exchange-traded funds in the United States recorded their third consecutive day of net outflows on March 5, led by Valkyrie’s BRRR.
According to data from SoSoValue, the 12 spot Bitcoin ETFs recorded $38.3 million in outflows on Wednesday, extending their outflow streak to three days with $74.19 million and $143.43 million in net redemptions on Monday and Tuesday, respectively.
The majority of the outflows came from Valkyrie’s BRRR, with $60.42 million exiting the fund, while Invesco Galaxy’s BTCO and Bitwise’s BITB saw more modest outflows of $9.94 million and $6.87 million, respectively.
BlackRock’s IBIT, the largest Bitcoin ETF in terms of net assets held, managed to offset part of the outflows as it drew in $38.93 million from investors, bringing its total net inflows to $39.66 billion since its launch. The remaining eight Bitcoin ETFs saw zero flows on the day.
The total trading volume recorded by these investment vehicles stood at $3.27 billion on March 5.
Meanwhile, the nine Ethereum ETFs returned to outflows on March 5, with $63.32 million exiting the funds following a day of $14.58 million in net inflows, which had ended their prior eight-day inflow streak. The entire outflow seen on Wednesday came from Grayscale’s ETHE, which has the highest fees among Ethereum ETFs. The remaining Ethereum funds saw no flows on the day.
Notably, the significant outflows from both Bitcoin and Ethereum ETFs appear to be linked to growing uncertainty around former President Donald Trump’s proposal for a U.S. Crypto Strategic Reserve.
While the idea of holding Bitcoin and Ethereum as part of a national reserve aims to strengthen the U.S.’s position in the crypto space, it has sparked debate. Many in the crypto community view it as contradictory to Bitcoin’s decentralized nature, raising concerns about potential government influence over an asset designed to be independent.
Initially, the announcement provided a boost to the digital asset market, but that rally was short-lived as another wave of selling pressure emerged. Despite this, Bitcoin and the broader crypto market have managed to recover some ground, with BTC climbing back near $92,500 and the total market cap remaining above $3.1 trillion.
Looking ahead, analysts expect more price swings in the near term, particularly amid ongoing geopolitical tensions and trade uncertainties . Historical data from Bitcoin’s volatility index suggests that March could see heightened turbulence before potential stabilization in April, which might ease some selling pressure.
At press time, Bitcoin ( BTC ) was up 6.3% over the past day, exchanging hands at $92,710, while Ethereum ( ETH ) was trading 5.9% higher at $2,299 per coin.