This week in DeFi, a discussion has arisen regarding whether the increasing involvement of Wall Street participants could trigger the crypto market’s first significant “supercycle,” leading to digital asset valuations surpassing the traditional four-year cycle.
As the foremost smart contract blockchain, Ethereum’s native token, Ether (ETH), is poised to gain from “Wall Street’s embrace of blockchain,” according to BitMine, the largest corporate ETH holder.
Despite this optimistic outlook, Ether’s price recently dropped 13%, falling below the $4,000 mark for the first time since August 8, according to data from Cointelegraph.
Within the broader cryptocurrency arena, the vesting schedule for the Hyperliquid (HYPE) token will distribute approximately $11.9 billion in HYPE tokens over a 24-month period to the team, representing a potential “true test” of the token’s resilience, as indicated by Arthur Hayes’ family office fund, Maelstrom, stated on Monday.
Described as a “Sword of Damocles” scenario, this will introduce around $500 million per month in unlocks, with only about 17% anticipated to be absorbed through buybacks, leaving a potential supply overhang of approximately $410 million, according to Maelstrom researcher Lukas Ruppert.
A whale wallet known as “0x316f” withdrew $122 million in HYPE tokens on Monday, shortly after Maelstrom’s warning about the impending sell pressure.
Ethereum bulls promote supercycle; Wall Street remains cautious
The cryptocurrency market could potentially witness its first prolonged cycle driven by increased institutional capital and trading products within the Web3 sector, making investments in digital assets more accessible.
Some investors anticipate a crypto “supercycle” that could challenge the theory of the four-year crypto market cycle associated with the Bitcoin (BTC) halving, projecting that digital asset valuations could rise beyond this historical timeframe.
For Ethereum, the supercycle may be fueled by Wall Street’s expanding adoption of blockchain technology, as per BitMine Immersion Technologies, the largest corporate holder of Ether.
The primary catalyst for Ether could be described as “Wall Street running into the blockchain,” according to BitMine.
However, not all Wall Street figures are optimistic regarding Ether’s price movement.
US investment bank Citigroup has set a year-end price target of $4,300 for Ether, significantly below its all-time high of $4,953 observed on August 24.
“Current prices exceed our activity estimates, likely influenced by recent buying pressure and excitement regarding potential use-cases,” Citi noted in a Monday report seen by Reuters.
Over the previous six months, Ether has appreciated by approximately 108% and was trading at $4,177 at the time of this report, according to TradingView.
Continue reading
Circle investigates “reversible” USDC transactions, diverging from crypto principles
Circle, the second-largest stablecoin issuer worldwide, is reportedly exploring reversible transactions to aid in the recovery of funds lost to fraud and hacks, seemingly conflicting with one of the core principles of cryptocurrency: that transactions are conclusive and exempt from centralized control.
Circle president Heath Tarbert informed the Financial Times that the company is considering mechanisms to allow transactions to be reversed in cases of fraud or hacks, while still ensuring settlement finality.
“We are contemplating the potential for reversibility of transactions while ensuring that settlement is final,” Tarbert stated. “This presents an intrinsic tension between the ability to execute immediate transactions and their irrevocability […].”
Conflict with crypto ideals
Advocates for transaction reversibility argue it could assist victims of scams and enhance mainstream confidence in stablecoins. Nonetheless, this notion contradicts the decentralized framework that supports cryptocurrency, where transactions are permanent and resistant to unilateral alterations by issuers or validators.
Cointelegraph has reached out to Circle for comments regarding the specifics of transaction reversibility and the criteria that would govern reversals.
Continue reading
Vitalik advocates for open-source infrastructure in essential sectors
Ethereum co-founder Vitalik Buterin has emphasized the necessity of open-source, verifiable infrastructure across critical areas, including healthcare, finance, and governance, cautioning that centralized systems pose risks to trust and security.
In a Wednesday blog post, Buterin contended that as digital infrastructure becomes more integrated into daily life, dependence on closed, opaque systems elevates the risk of exploitation and monopolization.
“Civilizations that have profited the most from technological advancements are those that have produced the technology, not merely consumed it,” Buterin noted, adding that “openness and verifiability can combat global fragmentation.”
Buterin envisions a reality where verifiable devices comprise the foundation of global systems. “If left unchecked, digital tools will likely be designed and maintained by centralized corporations,” he cautioned. “However, we can strive for a superior alternative.”
Continue reading
BlackRock earns $260 million annually from Bitcoin and Ether ETFs
BlackRock’s cryptocurrency-based exchange-traded funds (ETFs) have emerged as a significant revenue generator, accumulating $260 million in annual revenue for the world’s largest asset manager, demonstrating a “benchmark” model for traditional funds pursuing profitable business strategies.
BlackRock’s Bitcoin and Ether ETFs are generating $260 million in annualized revenue, with $218 million derived from Bitcoin ETFs and $42 million from Ether products, as reported on Tuesday by Leon Waidmann, head of research at the nonprofit Onchain Foundation.
The success of BlackRock’s crypto-centric ETFs may prompt more investment giants from the traditional finance sector to explore regulated cryptocurrency trading products, with BlackRock’s crypto ETFs serving as a “benchmark” for institutions and conventional pension funds, Waidmann stated.
“This is no longer an experiment. The world’s leading asset manager has validated that crypto can be a significant profit center. This is a quarter-billion-dollar enterprise, developed almost instantaneously. In contrast, many fintech startups don’t achieve this in a decade,” he said.
Waidmann likened the ETFs to Amazon, which began with books and later diversified into various sectors. He noted that the ETFs represent the “gateway into the crypto realm.”
Continue reading
Aster leads the perpetual DEX surge to $70 billion in daily trading volume
Perpetual trading volumes on decentralized exchanges (DEXs) surged to an all-time high of $70 billion on Thursday, led by Aster, a new derivatives platform on the BNB Chain.
Perpetual DEXs witnessed record volumes for three consecutive days as decentralized perpetual trading activity intensified. On Tuesday, total volumes for perpetual DEXs reached $52 billion, followed by $67 billion on Wednesday.
The volume peaked at $70 billion on Thursday, showcasing renewed momentum in the decentralized finance (DeFi) derivatives market.
Aster led the pack with nearly $36 billion in 24-hour trading volume, accounting for over 50% of all perpetual DEX activity on Thursday. The platform surpassed competitors like Hyperliquid and Lighter, both of which recorded volumes exceeding $10 billion.
Continue reading
DeFi market overview
According to data from Cointelegraph Markets Pro and TradingView, the majority of the top 100 cryptocurrencies finished the week positively.
The Story (IP) token experienced a drop of over 30%, marking the top decline of the week within the top 100, closely followed by the memecoin launchpad Pump.fun’s (PUMP) token, which saw a decline of over 29% on the weekly chart.
We appreciate you reading our summary of this week’s most significant DeFi developments. Join us next Friday for more stories, insights, and educational content regarding this rapidly evolving space.
