kpk is pleased to present the dYdX Treasury SubDAO’s February Community Update, which outlines recent developments, market conditions, DYDX metrics, and programme execution.
This update is accompanied by kpk’s February Treasury Report, which provides a detailed review of treasury performance and strategy.
Market Update
In February, crypto markets remained cautious and largely range-bound, following the earlier-year deleveraging. Liquidity conditions remained relatively thin and risk appetite subdued, with price action dominated by macro-driven sentiment shifts and derivatives positioning adjustments rather than sustained spot demand. Market structure continued to show defensive characteristics, with capital concentration in large-cap assets and limited breadth expansion across altcoins.
Market Performance
Bitcoin experienced continued volatility throughout February, declining sharply during the first half of the month before stabilising in the mid-$60k range. Following a roughly 19% drawdown in early February, BTC traded around the mid-$60,000s as leverage unwound across derivatives markets.
By the final week of February, BTC was trading near $67,000, reflecting a stabilisation phase after the earlier sell-off but remaining well below prior highs.
Ethereum continued to underperform Bitcoin during the period. ETH traded around $2,000–$2,100 in late February, reflecting both weaker relative demand and continued pressure across the broader altcoin complex.
Despite the mid-month stabilisation, both BTC and ETH remained significantly below their 2025 highs, highlighting that the broader market continued to operate within a corrective phase following the late-2025 peak.
Institutional Flows
ETF/ETP flows were mixed during February, reflecting continued caution among institutional allocators.
BTC spot ETFs recorded several sessions of net outflows during the month, signalling reduced risk appetite after the early-February market correction. ETH investment products saw smaller but more stable inflows relative to BTC products, indicating selective positioning rather than broad institutional risk-on behaviour.
Trading desks also reported lower RFQ activity and reduced directional positioning, consistent with a broader slowdown in institutional trading participation. Overall, ETF flows acted as a neutral-to-negative influence on market momentum, failing to provide the sustained demand necessary to support a strong recovery following the early-month volatility.
Market Structure & Dominance
Bitcoin dominance remained elevated in February, reflecting the continued concentration of capital in the ecosystem’s most liquid assets. At the beginning of the month, BTC dominance was around 58–59% of total crypto market capitalisation, suggesting limited rotation into higher-beta assets.
This dominance profile is typically associated with defensive market conditions, where investors prioritise liquidity and relative safety over broader risk participation. Such environments often coincide with slower capital deployment into smaller-cap ecosystems and infrastructure tokens.
Funding & Derivatives
Derivatives markets experienced a leverage reset during the first half of February following the sharp market correction. Open interest declined materially before stabilising toward the end of the month.
Bitcoin open interest fell from roughly $36B to ~$21B (-42%), while Ethereum open interest declined from approximately $18B to ~$9B (-50%) during the early-February deleveraging event.
Following this reset, funding rates across major venues returned to more neutral ranges as speculative positioning stabilised.
Off-chain Funding (Binance Futures)
• BTC: +0.8% → +4.5% annualised
• ETH: +1.2% → +5.8% annualised
On-chain Funding (Hyperliquid)
• BTC: –3% → +12% annualised
• ETH: –5% → +15% annualised
DYDX Token Update
DYDX underperformed BTC, ETH, and HYPE on a relative basis throughout February. The token experienced a sharp drawdown during the early-month market sell-off and, although it partially recovered during the mid-month rebound, selling pressure resumed in the second half of the period. As a result, DYDX closed the month at the bottom of the normalised performance basket, ending below all three benchmarks.
Trading activity on the DYDX perpetual markets remained highly concentrated in the BTC-USD and ETH-USD pairs during February. BTC-USD continued to dominate platform activity, generating approximately $4.70B in notional volume across 1.11M trades, accounting for 74.34% of total market share.
ETH-USD ranked second-largest, recording approximately $1.01B in notional volume across 431k trades, representing 16.00% of total activity.
SOL-USD ranked third, generating approximately $416.6M in notional volume across 201k trades, with a 6.59% share of platform volume.
Beyond the top three markets, trading activity was significantly more fragmented. XRP-USD recorded approximately $31.9M in volume across 15.7k trades, while HYPE-USD generated approximately $17.7M across 33.3k trades. All remaining markets individually accounted for less than 1% of total platform volume during the period.
Buyback Programme — February Update
Open-market activity acquired 720,644 DYDX at an average price of $0.10054, executed across 1,462 orders, for a total outlay of $72,452 USDC. In addition, the programme completed one OTC transaction, acquiring 697,211 DYDX at an average price of $0.14343 for $100,000 USDC.
In total, 1,417,855 DYDX were acquired during February across 1,463 orders, with a combined expenditure of $172,452 USDC. Tokens were periodically transferred to the Treasury SubDAO buyback account. All buyback activity remains visible through the community-maintained Buyback Dashboard.
Staking Programme
No major delegation adjustments were made in February; they occurred at the beginning of March. You can follow all details in the periodic review #5 post.
Asset Allocation
As of 28 February, the Treasury SubDAO maintains the same overall composition reported last month, with updated DeFi strategy performance and liquidity movements reflected below.
The portfolio currently consists of:
- 83.18 M DYDX (90.3%);
- 841,861 USDC (9.7%)
Yield Generation
Staking Programme: $8,693 USDC generated by the Staking Programme – The lower value is a result of the new rewards distribution from proposal #313 (a reduction from 40% to 15%).
Token Allocation %
Other Updates
Two Directors of the Treasury SubDAO will be replaced to reflect organisational changes within kpk and to support operational continuity. This proposal is live for voting (#365).
Next Steps for March
- Buyback programme: continue DYDX purchases across CEX and OTC channels
- Facilitate cash settlement for service providers