Market Overview
January was characterized by a corrective phase across major crypto assets.
BTC declined by ~7.9%, while ETH decreased by ~14.6% during the month. Volatility remained elevated, with distinct directional phases – a rally in the first half followed by a sustained decline – creating a challenging trading environment.
Spot and derivatives volumes fluctuated, with periods of sharp intraday moves followed by consolidation. This combination of declining asset prices, uneven volatility, and a mid-month trend reversal from rally to sustained sell-off shaped the performance dynamics across yield strategies.
In this market regime:
• ETH-linked strategies faced pressure from price drawdowns.
• Fee generation remained moderate due to uneven trading activity.
• Capital preservation became a primary focus over aggressive yield expansion.
Below is a breakdown of how each strategy performed and what we expect under current market conditions.
Liquidity Providing Strategies Snapshot
- January performance:
USDT - 5% APY, 0.41% monthly yield
USDC - 5% APY, 0.41% monthly yield
ETH - 4% APY, 0.33% monthly yield
BTC - up to 7% APY, 0.25% monthly yield - February APYs: remain unchanged
- Risk profile: Medium
When this strategy performs best
Liquidity Providing strategies typically perform best during periods of market expansion and elevated volatility.
Higher trading activity and stronger price movements increase fee generation and improve capital efficiency.
At the end of each month, APY may be adjusted upward for the following month if market conditions support higher yield generation.
When performance may be lower
Performance tends to be more moderate during declining or range-bound markets with reduced trading volumes.
Lower activity directly impacts fee generation and limits yield potential.
In such environments, APY may be adjusted downward for the following month to reflect prevailing market conditions.
Maker Core Strategies Snapshot
- January performance:
USDT: up to 10% APY, 0.8% monthly yield
BTC: up to 5% APY, 0.41% monthly yield
XRP: up to 5% APY, 0.41% monthly yield
BNB: up to 6%APY, 0.49% monthly yield
SOL: up to 7% APY, 0.56% monthly yield
TRX: up to 6% APY, 0.49% monthly yield
DOGE: up to 7% APY, 0.56% monthly yield
BCH: up to 5% APY, 0.41% monthly yield
LINK: up to 5% APY, 0.41% monthly yield
XLM: up to 8% APY, 0.64% monthly yield
DAI: up to 7% APY, 0.57% monthly yield
DOT: up to 5.5% APY, 0.41% monthly yield
ARB: up to 7% APY, 0.57% monthly yield
ZIL: up to 10% APY, 0.79% monthly yield - February APYs: remain unchanged
- Risk profile: Low
When this strategy performs best
Maker Core strategies perform best in environments with strong trading volumes and meaningful price movements.
Higher activity increases execution opportunities and supports more consistent yield generation.
When performance may be lower
Performance tends to moderate during low-volume, low-volatility market phases.
When trading activity declines and price movements are limited, yield generation remains at baseline levels.
USDT DeFi Strategy Snapshot
- January performance: 10% APY, 0.79% monthly yield
- February APY: remains unchanged
- Risk profile: Medium
January performance was consistent with the strategy’s yield corridor under current market volatility.
When this strategy performs best
The USDT DeFi strategy performs best in environments with elevated trading activity and sustained volatility.
At the end of each month, APY may be adjusted upward for the following month if market conditions support stronger yield generation.
When performance may be lower
Performance may moderate during sharp squeeze events, where forced liquidations drive rapid price dislocations.
Under such conditions, capital allocation becomes more defensive, which may reduce short-term yield.
In these environments, APY may be adjusted downward to reflect the prevailing risk-reward balance.
ETH DeFi Strategy Snapshot
- January performance: up to 5% APY, 0.41% monthly yield
- February APY: remains unchanged
- Risk profile: Medium
When this strategy performs best
The strategy tends to perform best during periods of volatility when GMX traders incorrectly predict market direction.
In volatile phases where traders take the wrong side of the move, the strategy generates yield from trader losses and trading fees.
Over time, these phases offset periods when traders are profitable and contribute to long-term performance.
When performance may be lower
Performance may be more moderate under the opposite conditions – when GMX traders correctly predict market direction during volatile moves.
In these periods, trader profits can outweigh fee income, which reduces overall yield until market conditions shift.
USDT Bonds Strategy Snapshot
- January performance: -18% monthly yield
- February APY: up to 30% expected APY
- Risk profile: High
January performance came in below expectations, primarily due to the decline in ETH during the month.
The expected annualized return remains unchanged, as short-term drawdowns are within the strategy's design parameters.
When this strategy performs best
The strategy performs best during periods of rising ETH prices combined with elevated volatility.
A key factor is trader positioning on GMX. When traders incorrectly predict market direction, liquidity providers benefit from trader losses and trading fees.
Price appreciation in ETH has a significantly stronger impact on this strategy compared to the ETH DeFi strategy.
As a liquidity provider on GMX, performance depends on a combination of:
• ETH price dynamics
• Market volatility
• Trader positioning accuracy
Rising ETH prices and high trading activity increase fee generation. However, if traders position accurately, their profits – combined with impermanent loss – can temporarily reduce overall returns.
When performance may be lower
Performance may decline during market drawdowns when ETH price decreases and GMX traders correctly anticipate market direction.
In such periods, liquidity providers effectively pay out trader profits, while the decline in ETH price further pressures overall yield.
Algo Trend Strategies Snapshot
- January performance:
USDT: 5.04% monthly yield
BTC: 5.33% monthly yield - February APY:
USDT: up to 15% expected APY
BTC: up to 10% expected APY - Risk profile: High
January results were in line with the strategy’s design and prevailing market conditions.
When this strategy performs best
Algo Trend strategies perform best in markets with expanding volatility and sustained directional movement.
Strong, persistent trends allow the system to capture breakout continuation and build cumulative gains.
When performance may be lower
Performance typically degrades in low-volatility, range-bound environments where breakouts fail to follow through.
In such conditions, trend signals are weaker and directional conviction remains limited.
Building a resilient portfolio
A resilient portfolio is not built around a single yield figure, but around structured risk allocation.
Optimal portfolio may include:
• ~50% in Low-Risk strategies
• Up to 30% in Medium-Risk strategies
• Up to 20% in High-Risk strategies
This structure allows capital to be exposed to multiple return drivers simultaneously – fee generation, volatility capture, directional trends, and liquidity provision – each responding differently to market regimes.
EarnPark’s yield is designed as a layered model:
• Liquidity Providing and Maker Core strategies are for stable and predictable APY.
• DeFi strategies offer higher potential yield.
• High-risk strategies are for investors comfortable with volatility.
Diversification should be driven by strategy design and risk balance – not by headline APY alone.