Tether Targets $500 Billion Valuation in Funding Push

Hi! In today’s edition:

⦁ 🪙 Tether could be worth half a trillion dollars

⦁ 🧑‍⚖️ FTX claws at Genesis for $1.15B

⦁ 📰 CZ blasts FT for “fake news” on YZi Labs

⦁ 📉 HYPE tokenomics overhaul

⦁ ⛓️ Kiln’s $6.6B ETH restake looms large

⦁ 🎙️ Bits + Bips: next crypto winter, DATs, and gold

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Tether Seeks $500 Billion Valuation in Private Funding Round: Report

USDT issuer Tether is looking to raise between $15 billion and $20 billion for a 3% stake in the company, according to a Tuesday report from Bloomberg.

At the top end of that range, Tether would be valued at over $600 billion, while the lower end would place its valuation at $500 billion, putting Tether on par with major private companies like SpaceX and OpenAI.

However, one person involved in the process told Bloomberg that those are top-end targets and eventual numbers could be significantly lower.

When Bo Hines, Tether’s strategic adviser for digital assets, was asked about the proposed fundraising during a crypto conference in Seoul on Tuesday, he flatly denied any such plans and gave no further details.

After USDC issuer Circle achieved a $30 billion market cap following its IPO earlier this year, Artemis CEO Jon Ma projected that Tether would be valued at $515 billion if it became publicly traded.

Tether CEO Paolo Ardoino commented that the projected valuation “maybe a bit bearish” given the firm’s growing bitcoin and gold treasury, while also noting that there was “no need to go public.”

Tether reported a $4.9 billion net profit in Q2 2025 with $162.5 billion in reserves against $157.1 billion in liabilities.

FTX Seeks to Claw Back $1.15 Billion From Genesis Digital 

Creditor disbursements for victims of crypto exchange FTX’s bankruptcy are well underway, but the estate overseeing the process isn’t done with recovering funds.

On Monday, lawyers for the FTX Recovery Trust filed a lawsuit against bitcoin mining firm Genesis Digital Assets and its co-founders Rashit Makhat and Marco Krohn, looking to claw back $1.15 billion in assets.

The lawyers claim that those assets were transferred illegally by former FTX CEO Sam Bankman-Fried using commingled and misappropriated FTX customer funds, through FTX’s sister company, Alameda Research.

Bankman-Fried transferred the majority of these funds as part of a financing round, where he was the only significant investor interested in participating, according to the FTX lawyers.

“Worse still, over half of the funds invested went directly to Makhat and Krohn personally, allowing them to cash out of the failing company and conveying no benefit to GDA [Genesis Digital Assets] itself,” read the complaint.

In related news, a cryptic “gm” post from Bankman-Fried’s verified X account on Tuesday, reportedly managed by a friend, sent FTX’s FTT token soaring 32%.

Binance Co-Founder CZ Calls FT Report on YZi Labs’ Fundraising ‘Complete False News’

Binance co-founder Changpeng Zhao (CZ) has firmly refuted claims that YZi Labs, his $10 billion investment firm, is raising or planning to raise external capital.

“Complete false news from FT, with fake/wrong/made-up info and negative narratives,” said Zhao in a post.

His remarks come after a Financial Times article reported that YZi Labs is considering opening its fund to outside investors, citing alleged statements made directly by YZi Labs CEO Ella Zhang.

The FT report also stated that YZi had already accepted about $300 million in outside funding in 2022 before returning it, and that the U.S. Securities and Exchange Commission (SEC) had requested a private demo of companies backed by the fund.

“There is no demo. WTF is a demo for a fund,” said Zhao on X. 

“FT tried for a long time to lure me to a lunch interview, promising it will be positive coverage. I almost did it last week, but I was busy last minute, so Ella had lunch with them first, and this is what came out. It was a trap! Cancelling that lunch now,” he added.

DBA and Hasu Propose 45% Cut to HYPE Total Supply 

Crypto asset manager DBA’s co-founder Jon Charbonneau and Flashbots strategy lead Hasu have co-authored a proposal that would alter Hyperliquid’s native token HYPE’s economic model.

The proposed changes would immediately reduce HYPE’s total supply by 45% by revoking unminted tokens meant for future rewards, burning tokens held in the assistance fund, and removing the supply cap on total tokens.

According to the proposal’s authors, the problem with the current model is that large amounts of HYPE are authorized but not issued, and market valuation methods like Fully Diluted Value (FDV) often count these tokens, inflating supply and undervaluing HYPE.

Importantly, the changes would see no change to existing token holder ownership or the protocol’s ability to fund value-creating initiatives.

Supporters of the proposal said that it provides more clarity and fixes a broken FDV metric, while critics argued that HYPE’s fixed supply should not be removed. 

Charbonneau discussed the proposal on Unchained on Tuesday.

Kiln Readies to Restake $6.68 Billion Worth of Ethereum

By Steven Ehrlich

For a few months now, all eyes have been on the Ethereum staking queue, which, after a year of remaining low, began to tick back up in June.

Though it started to decline, last Friday Unchained reported that it was set to rise again with four staking flows set to converge on the network in the coming weeks. One of those major flows is from Kiln, a $16 billion staking provider.

On Sept. 9, Kiln abruptly pulled 1.6 million ETH ($6.6 billion) from the Ethereum network. It will now be taking a major step towards restaking it.

“We target early next week to re-enable new ETH validators,” wrote Thomas de Phuoc, co-founder and chief operating officer at Kiln in an email to Unchained.

But with billions in ETH about to hit the staking queue at once, could Ethereum be heading for its biggest bottleneck yet?

Bits + Bips: How Wall Street Could Make a Killing off the Next Crypto Winter

Could the next crypto winter be a “nuclear” winter? Plus: if MSTR is over-levered and DATs start trading at discounts, who gets wiped?

Markets had a flood of liquidations on Monday, and traders lost over $1.5 billion in positions. So, why are liquidations spiking? Is this a warning or a blip?

Also, could a flood of DAT issuance be setting the stage for not just a crypto winter, but a crypto “nuclear” winter? If so, hedge funds and market structure could accelerate the pain.

This week on Bits + Bips, Steven Ehrlich, Ram Ahluwalia, Austin Campbell, and Vinny Lingham talk about why mNAVs could compress and whether even MicroStrategy’s stack is more fragile than it looks.

They debate the bull case for gold (yes, even at these ATHs), how tokenized stocks and changing reporting cadences could open new insider edges, and what the U.S. macro picture looks like.

Listen to the episode on Apple Podcasts, Spotify, Pods, Fountain, Podcast Addict, Pocket Casts, Amazon Music, or on your favorite podcast platform.

• 🛡️ Vitalik Buterin defended Coinbase’s Base network against centralization accusations, saying it doesn’t control users’ funds and is secured by Ethereum’s underlying system, not by centralized custody.

• 📉 BNB Chain validators proposed halving gas fees to about $0.005 per transaction and speeding up block times to stay competitive with Solana and Base, aiming long-term for sub-cent costs if staking rewards remain viable.

• 📈 ReserveOne, a crypto asset manager modeled after the U.S. Bitcoin Reserve, filed a confidential draft with the SEC for a $1 billion Nasdaq listing via a merger with a SPAC, and plans to manage a mix of top crypto assets post-deal.

• ⚙️ Uniswap Labs released “The Compact v1,” a decentralized contract system designed to fix liquidity issues across multiple blockchains, with support from other developers and plans to power Uniswap’s cross-chain swaps.

• 🗳️ Kraken donated $2 million to two pro-crypto political groups, saying the funding supports essential digital rights like privacy and self-custody as the U.S. moves closer to passing crypto regulatory legislation.

• 🏛️ The U.S. derivatives regulator CFTC began pushing for stablecoins to be allowed as collateral in major markets, with acting chair Caroline Pham calling tokenized assets essential for modernizing how financial institutions manage risk.

• 🌐 London-based Fnality secured $136 million from major banks and asset managers to expand its blockchain settlement system, which already enables real-time payments in digital cash backed by central bank funds.

• 🚀 Venture firm Archetype locked in over $100 million for its third fund to support early-stage crypto startups, signaling growing institutional appetite for onchain applications, decentralized finance, and blockchain-powered social platforms.

• 🦄 Crypto infrastructure startup Zerohash raised $104 million at a $1 billion valuation, backed by firms like Interactive Brokers and Morgan Stanley, as demand surged for tools helping institutions handle stablecoins and digital assets.

• 🏦 HSBC invested in blockchain forensics firm Elliptic and joined JPMorgan, Santander, and Wells Fargo as backers, signaling growing big bank demand for tools that track crypto risks and meet stricter regulations.

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