Last week, the Stacks Treasury Committee held its Q2 2026 quarterly meeting in the Cayman Islands. We want to make sure the community has a full picture of where things stand: the market, our treasury, and what's coming.

TL;DR: we're all in on using Bitcoin Staking as the top-funnel mechanism to drive more value and adoption to the network. Everything the Stacks Ecosystem has built over the past several years, from Nakamoto upgrades (fast blocks) to sBTC, to an onchain BTC economy (DeFi, wallets, integrations), has laid the groundwork for seamless onboarding and a strong user experience. As we scale Bitcoin staking, we are ready to support the organic inflow and new activity coming to Stacks. 

Macro Markets 

We're in a crypto bear market. Since April 1, approximately $220 billion has left the global crypto market cap, Bitcoin has pulled back from around $68,500 to around $59,200, and STX is down roughly 25% over the same period. Because STX trades as a high-beta play relative to Bitcoin, it tends to move further and faster than BTC in both directions, and the current environment reflects this. Though AUMs for Bitcoin ETFs have declined, BlackRock’s IBIT recorded its largest single-day inflow on April 15, a signal that Institutional appetite remains.

What gives us confidence is the historical pattern from leading researchers like Galaxy. Bitcoin drawdown cycles have lasted approximately 12 to 13 months, and we're eight months into this one. Prior cycles saw drawdowns of 84% in 2018 and 77% in 2022, both followed by rebounds that exceeded every prior peak. We've been through this before, and we know how it ends. We're planning conservatively, with internal models that assume Bitcoin could fall to $50K and STX to $0.11 before the cycle turns. We've structured the Endowment's runway through Q1 and Q2 of 2027 accordingly, without utilizing the long-term treasury. 

One data point worth sharing: in early May, a single day of transactions moved STX from $0.17 to $0.32, driven by a purchase in the $500,000 to $1 million range. Our team carefully analyzed the order book response and miner bid spend. It confirmed what we already believed: STX is highly responsive to demand pressure, and when Bitcoin Staking begins generating that demand at scale, the market and stack miners reflect it. 

Bear markets also bring consolidation of projects. A few Bitcoin-related projects are shutting down because they couldn’t withstand the difficult market conditions. Stacks has the treasury, the team, the track record, and the product pipeline to emerge from this cycle better positioned than ever.

Treasury & Finance

We have managed the treasury conservatively throughout this cycle. Our long-term treasury holdings sit at 112M STX. We hold most of the treasury in STX, which is both a risk and the source of our greatest upside when demand returns through Bitcoin Staking. We have been selling BTC from the treasury to cover operating costs, avoiding adding STX sell pressure to an already difficult market. Token sales to external parties have been limited exclusively to long-term STX holders committed to the project, with sales averaging below $500,000 per month, thereby minimizing open-market impact.

Total H1 forecast spend is approximately $10.7 million in fiat and $5.5 million in STX-equivalent. We are running above our December and March price assumptions because STX came in lower than modeled, meaning more tokens are required to cover the same fiat obligations. It's also worth noting that the team running this entire effort has done so more leanly than originally planned. We've held spending meaningfully below where it could have been, and that discipline is part of why we're confident in the runway numbers above. We have deployed approximately $7.3 million across DeFi liquidity and market-making. This deployment marks the first time the Endowment has maintained exactly equal deployment across both centralized and decentralized venues simultaneously.

As planned, we are currently under budget in the Marketing & Network Growth spending categories as the team and fractional CMO have arranged the heaviest activity to support the upcoming Bitcoin Staking launch. During the launch, Stacks Endowment will actively rebalance the budget to ensure the team has the resources required for a successful go-to-market. Every spending decision we are making right now is with that context in mind: we are running lean in areas where the return would not justify the cost, given the current environment, and concentrating our resources on the one catalyst that will drive real demand for STX through Bitcoin Staking. 

Bitcoin Staking (many years of groundwork)

Bitcoin Staking is the most important event happening in the Stacks ecosystem right now, and we want to explain why we're so bullish on it beyond just the yield mechanic. Bitcoin is the most widely held asset in crypto, and until now, there has been no compelling, self-custodial way for Bitcoin holders to put it to work. Stacks changes that, and we're uniquely positioned to do it. We've already distributed over 4,224 BTC in yield through Proof of Transfer. 

The potential for growth in this market is immense. Ethereum and Solana staking collectively hold between $38 billion and $50 billion in staked assets. The total value staked across all Bitcoin staking protocols today is less than $2 billion. We're entering an almost entirely untapped market, with years of yield infrastructure already proven on Stacks. 

When a Bitcoin holder bonds their BTC and earns native Bitcoin yield, they become a Stacks user. They connect a wallet, they see the ecosystem, and they start exploring what else is possible. That's the top of funnel activation, everything we've shipped this quarter has been building toward. Fireblocks going live on Stacks mainnet means the infrastructure that the majority of institutional Bitcoin holders already trust is ready. Other custody & multisignature integrations are underway to pave the way for more trusted interactions in Stacks.

As Bitcoin Staking grows, demand for STX grows with it, driving value across the entire ecosystem, since STX is the capacity to participate in Bitcoin staking. The ecosystem in which we see this value and user adoption of Bitcoin Staking flows into is already battle-tested. Bitflow has crossed $3 billion in transaction volume, and Zest delivered one of the more successful TGEs in the Bitcoin L2 during a bear market. When bonds fill, that capital can move through ecosystem-led Liquid Staking Protocols, which can compound yield and deepen liquidity. Institutions validate an ecosystem by its onchain conviction.

UTXO Management, the asset management arm of publicly traded Nakamoto Inc., which owns Bitcoin Magazine, has committed as our anchor launch partner. The ecosystem Business Development team is working to increase the number of partners committed to our bonds. 

Ecosystem Programs

Grants

Bear markets are when the best teams ship, and that's exactly why we're continuing to invest in the ecosystem. Q1 grants are progressing well, with most grantees now working through Milestone 3, which requires onchain adoption and user activity. Grants should lead to real-world use, and the early results are encouraging. Eight grantees have also joined the Foundry Validate program to sharpen their go-to-market approach, and we're already seeing cross-project collaboration emerge organically.

Q2 grants applications just closed, with applications organized around four strategic themes: DeFi and Perpetuals, Real World Assets, Agentic Applications, and Privacy. They represent the product surface area that Bitcoin Staking will need when it's live. We've also published a Request for Projects list so builders know exactly what we're looking to fund, and launched a new grants portal that should significantly reduce the misaligned applications we saw in Q1.

This cycle also marks the relaunch of DeGrants, the community-governed grants program for projects outside the core strategic criteria, including community-building, creator, and educational initiatives. As always, the Endowment plays no role in the Degrants selection. The three community stewards for this cycle are: Jackbinswitch, mrwagmi.btc, and GPSC.btc. We look forward to seeing what creators, educators, and builders are selected.

Founder Success

Grants get builders started, and the Stacks Foundry develops them into the startups that will define the next chapter of the Bitcoin economy. We built the Foundry because capital alone isn't enough. Builders need extensive go-to-market support, institutional introductions, mentorship, and in some cases investment. The Foundry is how we deliver all of that across four tracks designed to meet a team wherever they are. 

On this front, the Foundry’s first program, Validate, just wrapped its first cohort. Seventy applicants came in, sixty participated actively in the five-week program, and twenty-five progressed towards grant applications with a sharper customer profile and clearer product direction than when they started. The program exists to improve grant quality and give early-stage builders a real signal before they commit months to building in the wrong direction. The next program will be the Onboard program, which welcomes established teams to the Stacks ecosystem, with a focus on Founders who have a proven track record and on bringing existing users to the network. Stacks Endowment will publish more details. 

DeFi Ecosystem Support

One piece of feedback we've heard consistently from the community is that grants and Endowment liquidity alone aren't enough to sustain a healthy DeFi ecosystem. Builders need their own users and their own liquidity. In H2, Stacks Endowment will design an incentive-matching program that rewards teams for sourcing external capital with a boost from the Endowment, rather than simply providing liquidity directly. The goal is an ecosystem where protocols earn their liquidity rather than relying solely on the Stacks Endowment, thereby fostering long-lasting relationships with their LPs. In the meantime, we're continuing to support a few protocols by actively providing liquidity and thoughtfully considering where to deploy next as the ecosystem matures with new pools and projects.

Looking at Q3

We've planned for this cycle, and we're ready for what comes next. We're continuing to back the builders who are showing up, shipping through this bear market, creating value for Stacks, and making the Bitcoin economy a living reality. 

Tech shipped in Q2:

• sBTC Bridge redesign
• Three clean mainnet node releases on the 3.4.x line
• Clarinet shipped 6 releases
• At-Block removal - enables pruned nodes for cost savings
• Added smart caching to Smart Contracts to make the chain go faster (complex smart contract calls take seconds, not minutes)

Coming in Q3:

• Pyth Migration
• POX 5
• Constant improvements for Developer Tools, Explorer, APIs

Bitcoin Staking is our primary strategic focus, and the entire TC is committed to its success. It's going to bring a new wave of capital and users into everything this community has built, and the flywheel it creates, from bonds to LSTs to DeFi to new users on Stacks, is what this ecosystem has been waiting for.