Weekly DeFi News Recap Ep2

DeFi Statistics

ETH’s price rally toward cycle highs boosted the dollar value of assets locked in DeFi, but the impact wasn’t uniform. Lending TVL jumped sharply, probably a consequence of the higher valuation of collateral and increased borrowing demand as users became more active. This is a continuation of the trend we have seen in recent months. Liquid staking, however, saw a pullback, likely as some stakers took advantage of the higher ETH price to exit and realize gains rather than keep funds locked.

On the activity side, more unique wallets showed up even as total transaction count slipped, consistent with users doing fewer, larger, or batched moves in a low-fee environment. Average swap costs fell sharply this week, while Ethereum’s price rally toward new highs added further fuel to on-chain trading. Cheaper transactions removed cost barriers just as rising asset values encouraged traders to rebalance and chase momentum. Together, these factors drove the sharp increase in DEX volume shown in the table.

Aave Drops 8% on Rumors of WLFI Token Deal

AAVE fell more than 8% over the weekend after rumors circulated about a governance deal with World Liberty Financial (WLFI), a DeFi platform linked to members of the Trump family. The claims suggested Aave’s DAO would receive 7% of WLFI’s token supply and a cut of protocol revenues. While WLFI representatives denied the arrangement, Aave founder Stani Kulechov referenced the original October 2024 proposal and that hinted the terms remain valid. The token dropped from $385 to $339 before rebounding again to $352.

The episode shows how rumors in DeFi can lead to great price volatility. Aave’s turbulence comes amid a broader DeFi surge, with sector-wide TVL above $167 billion and climbing toward historic highs. Institutional interest continues to drive inflows, but growing entanglement with political and traditional financial players has sparked debate within the community about regulatory risks and the long-term independence of decentralized protocols.

Source: cointelegraph.com

Hyperliquid Captures 80% of DeFi Derivatives Market

Hyperliquid has rapidly become the dominant platform in decentralized derivatives, recently averaging around $30 billion in daily trading volume and accounting for over 80% of DeFi perpetuals, according to a RedStone report. Its growth has been attributed to its on-chain order book architecture, the HIP-3 framework allowing permissionless market creation with revenue sharing for market creators, and a dual-chain setup (HyperCore and HyperEVM) that supports custom trading strategies and tokenized perpetual positions.

The protocol currently holds about $2.2 billion in TVL and has processed roughly $330 billion in trading volume over the past month. Unlike many competitors, it is self-funded, which some see as notable given its scale. Observers point to its technical design and incentives for external contributors as factors that could influence how decentralized derivatives evolve, though its long-term sustainability and ability to maintain this market share remain open questions.

Source: coindesk.com

Curve Considers 60M crvUSD Pre-Mint for Yield Basis

Curve DAO is debating a proposal to pre-mint 60 million crvUSD to seed Yield Basis, a new AMM developed by founder Michael Egorov. The design aims to eliminate impermanent loss in Bitcoin pools by pairing borrowed crvUSD with BTC across Curve’s wBTC, cbBTC, and tBTC pools. Supporters argue the move is effectively a credit line, not an expansion of circulating supply, and could address a major scaling challenge for crvUSD by driving demand-side usage.

Critics, however, warn that pre-minting sets a dangerous precedent for governance and could concentrate risk if not tightly managed. With crvUSD’s current market cap at $127 million, the proposed allocation represents nearly half its supply. Proponents liken the model to Curve’s PegKeepers, which already manage pre-allocated crvUSD. The outcome of the debate will determine whether Curve can accelerate adoption of its stablecoin without undermining confidence in its monetary framework.

Source: blockworks.co

Fed Officials Signal Support for DeFi and Stablecoins

Senior U.S. Federal Reserve leaders voiced strong support for DeFi and blockchain innovation at the Wyoming Blockchain Symposium, marking a sharp turn toward regulatory acceptance. Governor Christopher Waller dismissed fears around DeFi, describing it as simply new technology for payments and transactions, while emphasizing stablecoins’ potential to expand the U.S. dollar’s global role. Vice Chair Michelle Bowman urged regulators to abandon excessive caution, highlighting blockchain and tokenization as tools to dramatically improve payments and settlement systems. She confirmed that supervisors are already working on a regulatory framework for stablecoins under the GENIUS Act.

The remarks align with Trump administration policies and signal that U.S. regulators are preparing to formally integrate digital assets into mainstream finance. Markets responded immediately, with DeFi tokens rallying on the news: AAVE gained 7.9% and UNI climbed 6.6% following the announcements. The Fed’s stance suggests a more supportive environment ahead for decentralized finance, easing fears of regulatory overreach and boosting institutional confidence in the sector’s long-term growth.

Source: beincrypto.com

Jupiter Lend Prepares Beta Launch on Solana

Jupiter, Solana’s largest DeFi aggregator, is set to launch Jupiter Lend in public beta this week, marking its first move into the lending vertical. The product integrates Fluid’s liquidity and risk engine, a system that has gained traction on Ethereum by rethinking how debt functions in DeFi. Fluid’s model allows borrower debt to act as productive liquidity for its DEX, earning trading fees to offset interest costs, while its “tick-based” liquidation system reduces slippage and penalties. This design enables unusually high loan-to-value ratios of up to 95%, compared with 70–85% on protocols like Aave.

The launch positions Jupiter to challenge Kamino’s dominance in Solana lending and broaden its superapp ambitions beyond aggregation, perpetuals, and token launches. With Fluid already driving $1.4 billion in active loans on Ethereum, the collaboration highlights how Solana protocols are adopting proven models from other chains to capture market share. The beta will be closely watched as one of the most significant DeFi product battles currently unfolding in the Solana ecosystem.

Source: blockworks.co

Bitcoin L2 Hemi Integrates HoudiniSwap for Private BTCFi Transactions

Bitcoin Layer-2 network Hemi has partnered with HoudiniSwap to add privacy-focused transaction capabilities to its BTCFi ecosystem. Hemi extends Ethereum-style smart contracts to Bitcoin, enabling DeFi participation across more than 100 blockchains, while HoudiniSwap specializes in confidential, non-custodial swaps and has processed $1.7 billion in private transaction volume. The integration allows Hemi users to conduct cross-chain transfers with hidden wallet activity, balances, and transaction data, providing both cost efficiency and anonymity.

The alliance puts emphasis on privacy in DeFi infrastructure. Houdini’s identity solution on Hemi enables user verification without exposing personal data, supporting secure adoption of BTCFi applications. By combining Bitcoin’s security base with Houdini’s confidentiality tools, the partnership broadens Hemi’s appeal to privacy-conscious traders and developers. Analysts view the move as part of a broader Web3 trend where privacy and governance are becoming central requirements for scaling blockchain utility in mainstream finance.

Source: blockchainreporter.net

MetaMask Launches mUSD Stablecoin With Stripe, Debit Integration Ahead

MetaMask has unveiled plans for mUSD, a dollar-backed stablecoin issued by Stripe subsidiary Bridge, set to launch later this year on Ethereum and Linea. Fully compliant with the new GENIUS Act, mUSD will be integrated directly into MetaMask’s wallet ecosystem, enabling seamless on- and off-ramping into dollar equivalents. The stablecoin will later be enabled as a payment option for the upcoming MetaMask debit card, powered by Mastercard, expanding its use case beyond DeFi into everyday payments.

MetaMask aims to position mUSD as a core liquidity layer across both its wallet ecosystem and the broader DeFi market, using its large user base to gain an advantage over rival stablecoins. While mUSD itself will not generate yield due to regulatory restrictions, executives indicated it could feature in future incentive programs. With this move, MetaMask joins other major fintech and crypto firms in targeting the rapidly expanding stablecoin market.

Source: decrypt.co

zkLink Partners With B2 Network to Fuse AI and Cross-Chain Liquidity

zkLink has announced a partnership with B2 Network aimed at creating an AI-driven, fully automated DeFi trading ecosystem. zkLink, which specializes in cross-chain liquidity aggregation, will integrate its infrastructure into B2 Network’s AI-powered blockchain. The collaboration envisions autonomous agents scanning, routing, and executing trades across fragmented liquidity pools in real time, improving speed, precision, and capital efficiency.

By combining AI decision-making with zkLink’s liquidity rails, the two projects aim to address inefficiencies in decentralized trading and reduce risks linked to liquidity fragmentation. The initiative represents an experimental frontier for DeFi, positioning zkLink and B2 Network at the intersection of artificial intelligence and financial infrastructure, where automated systems could reshape global asset trading dynamics.

Source: blockchainreporter.net

Centrifuge Brings Tokenized RWAs to EVM DeFi Platforms

Centrifuge has launched decentralized real-world asset (deRWA) tokens on Aerodrome, a leading DEX on Base, enabling tokenized assets to be traded and used as collateral across the EVM ecosystem. The first product, deJAAA, represents a tokenized version of the Janus Henderson Anemoy AAA CLO Fund, an actively managed vehicle investing in AAA-rated collateralized loan obligations. By integrating institutional-grade assets into DeFi, Centrifuge aims to diversify liquidity beyond crypto-native tokens and offer stable yield opportunities within decentralized markets.

The deJAAA token will be available across Coinbase’s DEX, as well as via OKX Wallet and Bitget Wallet, extending access to an estimated 200 million users. Centrifuge plans to expand its deRWA standard to Ethereum and Solana in the coming weeks. The move represents a milestone in bridging traditional finance with DeFi, positioning RWAs as a core liquidity layer for the next phase of on-chain financial products.

Source: crypto.news