# Getting Started with ETH Strategy's ESPN Vault *Author: William M. Peaster* *Published: Feb 17, 2026* *Source: https://www.bankless.com/read/eth-strategy-espn-vault* --- I'm a little old school. I like my DeFi yield opportunities to be centered around ETH. I'm also a sucker for upstart, early-stage DeFi protocols that bring entirely new possibilities to the table. *We need more of them*. The good news? Multiple projects currently fit this bill. Today, we're taking a look at [**ETH Strategy**](https://www.ethstrat.xyz/) and one of its core offerings, the [**ESPN Vault**](https://app.ethstrat.xyz/espn), which offers leveraged exposure to ETH in a way we've never seen before. Let's walk you through the basics here in case you want to explore this vault for yourself, as it's offering ~16% APY right now! ## **What Is ETH Strategy?** ![](https://bankless.ghost.io/content/images/2026/02/image-27.png)ETH Strategy is a DeFi protocol inspired by MicroStrategy's Bitcoin accumulation playbook, though rebuilt in an entirely open format on Ethereum. The underlying operations can get a little complicated, but the main thrust is simple: the protocol borrows money from users and uses it to buy ETH, growing a treasury over time. In exchange for lending their money like this, users receive call options on ETH instead of traditional interest payments. The protocol's native token, [**STRAT**](https://www.coingecko.com/en/coins/eth-strategy), represents leveraged ownership of the project's ETH treasury. The idea is that when ETH goes up, STRAT goes up more. It's an avenue for amplified ETH exposure without the liquidation risks that typically come with margin trading. ## **What Is ESPN?** ![](https://bankless.ghost.io/content/images/2026/02/image--5-.jpg)ESPN, short for [**ETH Strategy Perpetual Note**](https://docs.ethstrat.xyz/espn/espn)**, **is a yield-generating vault that sits within the ETH Strategy ecosystem. The vault is designed for users who want to earn yield on their stablecoins without taking on directional risk to ETH's price. In other words, it abstracts the ETH volatility trade into one token that can be easily minted and redeemed. Here's the simple version of how it flows: - ESPN lends stablecoins to ETH Strategy and receives call options in return. - The vault then sells shorter-dated versions of those same options on the open market, collecting premiums. - The premium income becomes yield for $ESPN holders. Because the options bought and sold are matched at the same strike price, the vault's USD value stays neutral to short-term ETH price moves. Metaphorically speaking, it's sort of like owning a long-dated lottery ticket, then selling shorter-dated versions of that same ticket every week to collect cash. The vault does all of this automatically, and you simply earn yield by holding the $ESPN token. ## **How to Get Started** ![](https://bankless.ghost.io/content/images/2026/02/image-29.png)Entering the ESPN trade is straightforward if you decide to dive in. First head to [**app.ethstrat.xyz/espn**](https://app.ethstrat.xyz/espn) and connect your wallet, then just follow these steps: - **Deposit USDS.** On the right side of the app, you'll see a "Mint" UI where you can deposit Sky Protocol's USDS stablecoin to mint ESPN tokens. If you don't already have USDS, click the "Get USDS" button, which will bring you out to a CoW Swap ETH-USDS market. Then back on ETH Strategy enter the amount of USDS you want to deposit and confirm the transaction. - **Receive ESPN. ** Once your deposit is in, you'll receive ESPN tokens. Currently the exchange rate is ~107 USDS per ESPN. There's no lockup period or vesting, and the ESPN price will rise over time as the vault earns yield. The yield here accrues automatically and is reflected in the rising redemption value of your ESPN tokens, so you won't need to claim anything. - **Redeem.** Whenever you want out of the trade, click over from the "Mint" tab to the "Redeem" tab on the vault page. Now just input how much ESPN you want to redeem for USDS and confirm the transaction. Redemptions are usually instant, but they may take slightly longer during periods of high withdrawal demand. ## **Zooming Out** The ESPN Vault is young. At the moment, its TVL is around $3.8M, and it has dozens instead of thousands of users. The yield here depends on ETH staying volatile, and how liquidity fares during a redemption-crunch is something to keep an eye on. Yet these are the frontier realities of frontier work. This tokenized vault strategy is a new DeFi primitive that gives us a new way to think about what ETH volatility is worth and how best to capture it. That's worth supporting. Plus, ESPN was deployed in late 2025, so the fact that it's small just means you're early. DeFi needs more novel experiments like this one, and if the thesis holds, the protocol has a lot of room to grow. Just size in responsibly if you decide to jump in at this stage! --- *This article is brought to you by [The DeFi Report](https://www.bankless.com/sponsor/the-defi-report-1767388444?ref=read/eth-strategy-espn-vault)*