Ether Hits New Record Before Brutal Crypto Whipsaw

Hi! In today’s edition:

• 🚀 ETH smashes record before brutal Sunday dump

• ❌ WLFI calls Aave deal “fake news,” token tumbles

• 💰 Stargate greenlights $120M LayerZero reunion

• 🔥 Powell pivot lights fire under ETH DeFi assets

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Ether Hits New Record Before Crypto Whipsaw 

Ethereum’s native token ether hit an all-time high of $4,953 on Sunday evening, surpassing its November 2021 record for the first time in nearly four years.

Almost immediately after reaching its new record, ETH experienced a sharp pullback — a pattern mirrored across the broader crypto market, with BTC and major altcoins also undergoing steep reversals between 4:30 and 5:00 p.m. ET.

By early Monday morning, the whipsaw had extended further, with bitcoin trading at $111,739 and ETH at $4,609 as of 6 am ET. Over the last 24 hours, $275 million worth of ETH positions were liquidated. Total crypto liquidations topped $800 million over the same period.

Economist Alex Kruger described the price action as “brutal.” However, Kruger thinks that the markets are “going higher.”

Cinneamhain Ventures partner Adam Cochran explained that relatively thinner markets on Sunday played a role in the dramatic price action.

On Sundays, some big traders push prices higher to trap others, then suddenly dump a lot of coins into a market where there aren’t many buyers, causing prices to crash and forcing leveraged buyers out of their trades.

“The moves just become exaggerated when there is froth, as late longs chase a perceived breakout,” said Cochran.

AAVE Tumbles After WLFI Reportedly Claims Token Deal is ‘Fake News’

Decentralized lending protocol Aave’s native token AAVE tumbled 8% after a rumor that its token deal with Trump family-linked DeFi protocol World Liberty Financial (WLFI) would not go ahead as planned.

The core issue centers around a governance proposal from October 2024, approved by the Aave DAO, that granted Aave about 7% of WLFI's total token supply and 20% of the protocol fees generated by WLFI’s deployment on Aave v3.

However, blockchain reporter Colin Wu sparked confusion when he tweeted that the WLFI team had called those claims “false” and “fake news.”

Aave founder Stani Kulechov responded to Wu’s post, reaffirming that the governance proposal had been approved by both Aave DAO and endorsed by WLFI.

The snapshot vote of the proposal in question indicates that it passed on December 13, 2024, with 797% of the required quorum reached.

The deal would position Aave to get $2.5 billion worth of WLFI tokens at current prices.

“The Art of Deal,” tweeted Kulechov on X.

Stargate DAO Approves $120 Million LayerZero Acquisition

The Stargate DAO has approved the LayerZero acquisition with an overwhelming majority, despite last-minute acquisition interest from Wormhole, Axelar, and Across.

The deal, valued at around $120 million, will see Stargate DAO dissolved, with STG tokens swapped for LayerZero's ZRO tokens at a ratio of 1 STG to 0.08634 ZRO.

LayerZero increased the bid and added incentives, including a revenue-sharing period for staked STG holders, after rival offers pressured the DAO to consider alternatives.

A majority of 95% of Stargate DAO members voted in favor of the revised LayerZero offer, despite a $120 million cash offer from Wormhole on the table, along with Axelar and Across expressing interest in joining the bidding process.

The acquisition reunites Stargate with its founding team LayerZero, which originally created the cross-chain protocol in 2021. It is also the first major DAO acquisition over the $100 million mark, setting a new precedent for decentralized mergers and acquisitions. 

“Throughout all of the noise, this has been the highest participation of any vote in Stargate history,” said LayerZero co-founder Bryan Pellegrino on X. 

“The bridge is home. It's go time.”

We covered this M&A on the Unchained podcast on Friday, check it out!

Why Ethereum DeFi Assets Soared the Highest on Jerome Powell’s Speech

By Juan Aranovich

Federal Reserve Chair Jerome Powell shocked markets Friday at Jackson Hole by signaling the Fed is preparing to cut interest rates as soon as September. In a closely watched speech, Powell flagged concerns about a slowing labor market even as tariffs continue to push consumer prices higher.

The comments marked a clear pivot from the Fed’s inflation-first stance of the past four years and instantly lit a fire under risk assets. Ethereum jumped as much as 14% to $4,800 on Friday—and by Sunday, it had climbed past $4,900 to set a new all-time high.

While it was a broad rally, the assets that soared the most were either yield-bearing or related to DeFi, especially on Ethereum.

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• 📦 Galaxy Digital, Jump Crypto, and Multicoin are seeking to raise $1 billion through Cantor Fitzgerald to build the largest Solana-focused treasury, a plan endorsed by the Solana Foundation and expected to finalize in September.

• 🪙 The first buyer of Kanye West’s YZY memecoin was revealed as a trader who once turned $1 million into $100 million on Trump’s token, and already cashed out over $1.5 million while still holding a large YZY stake.

• 📱 Telegram founder Pavel Durov slammed French authorities, saying that a year after his 2024 arrest they still had no evidence against him, and accused the government of damaging France’s reputation for free expression.

• 🇯🇵 Bitcoin treasury firm Metaplanet was promoted into the FTSE Japan and FTSE All-World indices after surging 187% this year, ensuring that global passive funds now funnel capital indirectly into bitcoin.

• ⚖️ Ethereum gaming network Xai sued Elon Musk’s AI company xAI for trademark infringement, claiming consumer confusion worsened after Musk said his firm would launch a gaming studio.

• 📈 VanEck filed to launch a JitoSOL ETF, the first U.S. spot Solana fund backed entirely by a liquid staking token, following SEC guidance that some staking activities don’t count as securities.

• 👮‍♂️ Interpol’s Operation Serengeti 2.0 led to 1,200 arrests across 18 African nations, seizing nearly $100 million, shutting down illegal mining sites, and dismantling massive fraud schemes that scammed tens of thousands of victims.

• 🤝🌏 Japanese giant SBI Group partnered with Chainlink to roll out blockchain tools for Asia’s banks, starting in Japan with projects like tokenized bonds, stablecoin audits, and cross-border settlement systems.

• 💡 A Philippine lawmaker introduced a bill to create a “Strategic Bitcoin Reserve” that would lock 10,000 BTC for 20 years, with the coins earmarked only for reducing the country’s debt burden.

• 💵 OKX CEO Star launched a $100 million X Layer Ecosystem Fund to back long-term blockchain builders worldwide, stressing it will exclude short-term pump-and-dump projects.

1. WSJ: How Eric Trump Became One of Crypto’s Greatest Evangelists

2. August 2025 Newsletter: Tighter Fiscal, Looser Monetary by macro expert Lyn Alden

3. On-chain Mind: How Bitcoin ETFs Are Quietly Taking Over The Supply