kpk is pleased to present this Joint Treasury Community Update to the Safe community. Going forward, these monthly community updates will from part of our regular reporting, together with the existing treasury update available on kpk website.
The Community Update will serve the following purposes:
- Offer greater transparency over the Joint Treasury (“JT”) operations and initiatives, and their rationales
- Reinforce accountability of the JT activities, providing a regular space for comments and questions
- Promote a culture of community engagement around the JT and its activities
Market Update
The market continued its positive momentum from April as concerns over aggressive tariff threats and trade wars were alleviated, and institutional inflows continued. BTC (+12%) reached a new all-time high of $112k mid-month, whilst ETH (+47%) strongly outperformed, firmly reclaiming the psychologically-significant $2k level. ETHBTC bounced from local lows of 0.018 and ended the month at 0.02416. May was also marked by a bifurcation of performance across the crypto space; despite strong ETH outperformance relative to BTC, most other altcoins (except for memecoins and HYPE) struggled to outperform Bitcoin (XRP -3%, BNB +10%, SOL +7%). The end result was an increase in Bitcoin dominance by 1.82 percentage points (from 61.68% at the start of May to 63.50% at the end of May).
Despite the general market rally, funding rates (both on-chain and off-chain) and open interest still remained subdued, potentially reflecting higher levels of sidelined capital and/or retail and long-term holders selling. This indicates that such short-term rallies are not yet indicative of a longer-term bullish trend, indicating that caution in approach may still be prudent.
A few interesting developments in the crypto space in May were
- Increasing numbers of entities are copying the Microstrategy playbook (i.e. using financial engineering to purchase Bitcoin or other cryptocurrencies to become crypto treasury companies).
- Strategy (formerly Microstrategy) further entered into sales agreement to issue and sell up to $2.1bn worth of its Preferred Stock.
- Metaplanet (a publicly-listed company on the Tokyo Stock Exchange) announced it will adopt Bitcoin as a strategic treasury reserve asset, citing Japan’s poor macroeconomic environment and a weak JPY as motivating factors. It will be leveraging cheap JPY borrowing costs to issue long-dated JPY liabilities to buy Bitcoin (JPY/Bitcoin carry trade).
- SharpLink (SBET) announced a $425M private placement to initiate a first-of-its-kind Ethereum treasury strategy. SBET rallied from $33.93 to a high of $124, but has since mostly retraced its gains.
- Trump Media (DJT) announced that it will raise about $2.5bn ($1.5bn via shares, $1bn via convertible notes) to invest in Bitcoin as it looks to diversify its revenue.
- Circle filed for public listing on the NYSE under the ticker symbol “CRCL”, with target valuation of up to $6.71bn.
- CRCL opened at $69 on June 5th 2025, and finished its first week of trading at $117.2, making its market capitalisation over $26B. Comparing to on-chain tokens, this valuation would make CRCL a top 10 token by market cap.
Off-chain markets have proven to be exciting. Following the successful initial public offering (IPO) of Circle, we expect more crypto companies to target IPOs in the near future, as investor appetite for crypto stocks increases. Crypto treasury companies have also been getting rewarded for buying Bitcoin, and have outperformed Bitcoin in the last 1 year, leading to a virtuous cycle for the growing number of crypto treasury companies.
However, if this trend reverses and the market stops allocating surplus value to corporations following a strategy of buying crypto (as it did for DJT and Gamestop), corporate demand for Bitcoin may start to dry up. In such circumstances, the premium to net asset value (NAV) of these crypto treasury companies would likely compress eventually, like it did for Grayscale’s premium last cycle. We continue to observe these structural drivers as we formulate our market view, and apply caution in the face of short-term market rallies given the backdrop of a lack of participation and compressing premiums.
Chart 1: Return statistics of major assets
SAFE Token Update
$SAFE (+9.0%) underperformed BTC and ETH in May. $SAFE’s correlation to other crypto remained relatively high (0.5-0.6), although lower than some other assets (e.g. GNO).
Current circulating supply of the $SAFE token stands at ~580M $SAFE token (58% of total supply), with monthly unlocked supply expansion of ~2% based on initial tokenomics.
Chart 2: 30-day Correlation
$SAFE continues to enjoy elevated off-chain trading volume, especially on Korean exchanges, such as Upbit. Upbit is also likely the largest, non-ecosystem holder (i.e. not Safe DAO- or Foundation-related wallets) of $SAFE tokens.
Below is a distribution of daily trading volume on 3 major venues (Upbit, Bybit, Uniswap v3 0.3% pool).
JT Update
Financial Update
Asset Allocation
- Joint Treasury’s AUM stood at $28.7M at the end of May, with 87.8% in $SAFE, 6.5% in ETH, and 4.5% in stablecoins.
- Asset utilisation remains low at 16.8%, as most of the Joint Treasury remains concentrated in $SAFE token with limited on-chain usage. 99.7% of non-SAFE assets are being utilised to either generate yield and/or to support on-chain $SAFE liquidity.
- Usage of Joint Treasury assets can be divided into three broad categories:
- SAFE Usage (47.7M SAFE): 5.3% of SAFE is currently being used for providing on-chain $SAFE liquidity on Uniswap V3 Ethereum Mainnet; the majority (94.7%) is being held idle in the wallet
- ETH Usage (732 ETH): 75% of ETH is currently being used to earn yield on Liquid Staking Protocols (Lido, Stakewise), and the remaining 25% is used to provide on-chain $SAFE liquidity on Uniswap V3 Ethereum Mainnet.
- Stablecoin Usage (1.3M wxDAI): all stablecoins are currently held in sDAI on Gnosis Chain, earning the DAI Savings Rate (5.7% for May).
$SAFE On-chain Liquidity Management
- The main avenue for on-chain $SAFE liquidity management is Uniswap V3 on Ethereum Mainnet, using multiple ranges to ensure sufficient liquidity through market volatility.
- $SAFE liquidity has improved, and $10k swaps can be conducted with relatively low levels of slippage:
- $10k Purchase (ETH → SAFE) can be conducted with 100bp slippage on Uniswap V3; on CoW, the slippage is minimal (<20bp)
- $10k Sale (SAFE → ETH) can be conducted with 57bp slippage on Uniswap V3; on CoW, the slippage is greater at 158bp.
- On-chain liquidity management of SAFE/WETH pools have also proved lucrative, although fee maximisation is not the primary objective:
- Total PnL from Uniswap V3 positions was $128k ($128k from fees generated vs. $8.7k from divergence loss).
- Comparable tokens for benchmark include: GRT, LINK, LDO, ETHFI, W, EIGEN, GNO. These tokens share some similarities with SAFE
- Similar market capitalisation, i.e. in Top 100-200 (LDO, ETHFI, W, EIGEN, GNO).
- Token generation/transferability events took place in 2024 (ETHFI, W, EIGEN).
- Widely considered as top DeFi infrastructure projects.
Business Development Update
- SafeBoost Programme resumed on May 20, 2025:
- SafeBoost is an ecosystem initiative by the Joint Treasury aimed at boosting Safe usage on Gnosis Chain. 250,000 $SAFE has been allocated to the Programme, and will be distributed to users who participate in the Programme.
- Doubling effectiveness via partners: we have partnered with 3 partners (PoolTogether, Beefy, Contango) in the Gnosis Chain ecosystem, with more partners to be added in the future. These partners have offered their own incentives to the Programme (e.g. if you use PoolTogether with your Safe Account on Gnosis Chain, you earn basic SafeBoost point and PoolTogether point), allowing each SafeBoost point to go further.
- $SAFE Token DeFi Integration:
- Multiple conversations are ongoing with leading DeFi protocols, aimed at integrating $SAFE. Further DeFi integrations would increase token utility, but actual implementation will depend on the costs associated with the integrations (e.g. extra liquidity required, incentives required, etc.)
Other Updates
- We have drafted an Investment Policy Statement (IPS) that aims to details the Joint Treasury’s goals and activities. The IPS will serve as a living document that evolves with the JT, and also provides clear north star objectives to guide the JT’s efforts. For more information about IPSs, see our article.
- Permissions Layer Implementation: the JT will be implementing kpk’s Permissions Layer technologies, aimed at increasing the layer of security and control around the Treasury. kpk (the JT Manager) will only be able to conduct operations that have been pre-approved by the JT through our onchain permissions contracts. For more information about our Permissions Layer, see our article.
Next Steps
In the next 6 months, we will be focusing on the existing initiatives, including:
- Finalising the upcoming work pipelines for the Joint Treasury, including formalisation and sharing of Investment Policy Statement with the Safe Community, and implementation of our Permissions Layer technologies.
- Further refinement of our ongoing Treasury Management activities, especially pertaining to Liquidity Management of SAFE token.
- Successful completion of the SafeBoost Programme.