Nakamoto has introduced a new Bitcoin derivatives program aimed at generating steady income while reducing downside risk from market volatility.
Key Takeaways
- Nakamoto launched an actively managed Bitcoin derivatives program in early 2026.
- The strategy focuses on earning income from volatility and protecting against price drops.
- Bitwise Asset Management manages the strategy, with custody handled by Kraken.
- The move comes as Bitcoin treasury firms face pressure from declining prices.
What Happened?
Nakamoto, a Nasdaq listed Bitcoin treasury company, announced a derivatives program that has been active since the first quarter of 2026. The initiative is designed to generate recurring income while also limiting exposure to falling Bitcoin prices.
The program uses a portion of Nakamoto’s Bitcoin holdings as collateral, combining income generating options strategies with protective hedging tools.
Today we announced an actively managed Bitcoin derivatives program facilitated by Kraken and Bitwise. The program is designed to generate volatility income and hedge downside risk.
— Nakamoto (@nakamoto) April 24, 2026
“Bitcoin’s implied volatility is one of the most persistently mispriced assets in capital… pic.twitter.com/Ss48MyzCZU
How the Strategy Works?
Nakamoto’s program is built around two key components that work together under a structured risk framework.
Income Generation Through Options
The company uses covered calls and call spreads to generate income from Bitcoin market volatility. This approach allows Nakamoto to collect premiums by selling options tied to its Bitcoin holdings.
- Focus on converting implied volatility into consistent income.
- Premiums may be received in both Bitcoin and US dollars.
- Income can be reinvested into Bitcoin or used for operational needs.
Hedging Against Downside Risk
To balance the income strategy, Nakamoto also uses protective puts and put spreads. These instruments help reduce losses during periods of price decline.
- Provides partial protection against sharp Bitcoin price drops.
- Helps stabilize the company’s overall asset value.
- Reduces the risk of forced selling in weak markets.
The company noted that both strategies operate together, with income from options sometimes helping to fund hedging costs.
Role of Bitwise and Kraken
The derivatives strategy is managed by Bitwise Asset Management through a separately managed account. Meanwhile, the Bitcoin used in the program is held in Kraken’s qualified custody solution.
This setup ensures institutional grade execution, risk management, and asset security. Nakamoto’s Chief Investment Officer Tyler Evans said, “Bitcoin’s implied volatility is one of the most persistently mispriced assets in capital markets.”
He added that the company aims to “harvest that premium systematically, at scale, and convert that opportunity into long term value for shareholders.”
Market Pressure on Bitcoin Treasury Firms
The launch comes at a time when Bitcoin treasury companies are facing growing pressure due to falling prices. Bitcoin has dropped around 38 percent from its all time high of 126198 dollars reached in October 2025.
Nakamoto itself has seen significant impact:
- The company’s stock is down about 46 percent this year.
- Shares recently traded near 0.22 dollars.
- It holds over 5098 Bitcoin worth roughly 395 million dollars.
To manage liquidity, Nakamoto previously sold 284 Bitcoin in March, valued at around 20 million dollars at the time.
Other firms have taken similar steps. Genius Group sold its entire Bitcoin holdings to repay debt, while Empery Digital liquidated a large portion of its reserves to raise capital.
Why This Strategy Matters?
Nakamoto’s move highlights a broader shift among Bitcoin treasury firms. Instead of simply holding Bitcoin, companies are exploring ways to generate yield and manage risk without fully exiting their positions.
The derivatives program allows Nakamoto to stay exposed to Bitcoin while creating an additional income stream. It also provides a cushion during volatile periods, which have become more common in recent months.
CoinLaw’s Takeaway
In my experience, this is a smart evolution in how companies handle Bitcoin on their balance sheet. Just holding Bitcoin worked well in a strong bull market, but the recent downturn has exposed the risks of that approach.
I found Nakamoto’s strategy practical because it combines income generation with protection. It shows that companies are starting to treat Bitcoin more like a financial asset that needs active management rather than a passive bet.
If more firms adopt similar strategies, we could see a more stable approach to corporate Bitcoin holdings going forward.
