How Protocols and Foundations Can Manage Treasury Risk and Liquidity

Protocols, foundations, and DAOs sit on some of the largest token treasuries in crypto. But managing that capital has always been harder than it should be. Token unlocks create selling pressure. Market drawdowns impact runway. And most tools available today were built for hedge funds, not for organizations focused on sustaining and growing an ecosystem.

BitGo's OTC desk was built to address these challenges. Through a combination of risk management solutions, hedging strategies, and structured products, protocols and foundations can better protect capital, manage unlock risk, and generate rewards, all from within regulated qualified custody.

The problem

If you're a foundation, your treasury is often concentrated in a single asset. That means your operational capacity rises and falls with the market. When prices drop, your ability to fund development, grants, and ecosystem growth can fall with it.

Traditional approaches introduce tradeoffs. Selling tokens on the open market creates downward pressure and signaling risk. Moving assets to external venues introduces counterparty exposure. And many financial tools are not designed for workflows like managing unlock schedules or planning around long-term treasury needs.

What's now available

BitGo's OTC desk provides access to hedging and structured solutions directly from within regulated qualified custody. Combined with insights from market activity and liquidity conditions, organizations can take a more proactive approach to treasury management.

Here's what that looks like in practice:

• Swaps can be used to manage exposure across assets and reduce concentration without immediate open market selling

• Options-based strategies provide a flexible way to enhance returns on held assets or define costs around strategic initiatives such as token buybacks

• Structured hedging strategies allow teams to plan around known events like token unlocks, helping reduce uncertainty and manage downside risk

• Exposure management tools enable organizations to adjust positioning without directly moving underlying assets

Use cases

These solutions can be tailored depending on treasury objectives:

Generating rewards on idle reserves

DAOs and foundations can implement structured strategies designed to enhance returns on undeployed assets while maintaining custody.

Hedging treasury risk

Organizations managing unlock schedules can use hedging strategies to reduce downside exposure ahead of distribution events and improve planning certainty.

Strategic repositioning

Foundations can gradually adjust treasury exposure or diversify holdings without relying solely on open market transactions.

Why this matters for foundations

Protocols and foundations care about a consistent set of priorities: managing unlocks, maintaining treasury stability, accessing liquidity, and supporting long-term ecosystem growth. BitGo brings these capabilities together in one platform: OTC liquidity, discreet execution for large transactions, structured liquidity planning for locked assets, and integrated risk management solutions. All activity is anchored within qualified custody, reducing the need to move assets or take on additional counterparty risk.

Financing without leaving custody

BitGo also enables borrowing and lending directly from regulated custody accounts. Organizations can unlock liquidity to fund operations without selling assets, or access bespoke financing solutions tailored to their collateral profile. All activity remains integrated within the same platform used for custody, execution, and reporting.

Getting started

BitGo works with protocols, foundations, and investors to develop tailored treasury strategies based on unlock schedules, risk tolerance, and long-term objectives.

Whether the goal is to hedge exposure, enhance capital efficiency, or plan for upcoming liquidity events, BitGo's OTC desk can help structure solutions that align with institutional requirements.