Weekly Recap: Tether’s Sky-High Valuation Bid, Circle’s Reversible USDC

Plasma’s Successful Launch, Revenue Over TVL & the Future of Pump. fun

Today on Unchained, we have something special: three interviews instead of one.

First, CoinFund’s Seth Ginns explains why he is so bullish on Plasma, the first stablecoin-focused blockchain to launch.

Then, Solana Foundation president Lily Liu argues that revenue, not TVL, is the best way to measure real value in crypto. 

Finally, Figment Capital’s James Parillo makes the case that Pump.fun is not just a memecoin casino but a new model for streaming and online culture.

You can also find the audio version!

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

Now, let’s get into this week’s news! In today’s edition:

• 💵 Tether eyes $500B valuation with potential $20B private raise

• 📈 Regulators probe trading spikes ahead of corporate crypto-treasury buys

• 🔄 Circle considers reversible USDC to attract traditional finance players

• ⚖️ FTX estate sues Genesis as $1.6B payout moves ahead and SBF’s account stirs FTT frenzy

• 🌐 Cloudflare launches NET Dollar stablecoin to power AI-driven internet payments

• 🔥 Proposal to slash HYPE supply by 45%, sparking debate over tokenomics

• 🪙 Kiln to restake $6B in ETH after precautionary withdrawal crowds exit queue

• 🏛️ CFTC vacancy delays Clarity Act, with Quintenz nomination stalled in Washington

• ⚡ Aster leapfrogs Hyperliquid in daily perps volume as Hyperliquid rolls out USDH stablecoin

• 🚫 CZ slams FT report on YZi Labs fundraising as “complete false news”

Tether Explores Record $500 Billion Valuation in Private Raise

Tether, the issuer of the world’s largest stablecoin USDT, is in talks with investors about raising up to $20 billion in a private placement that could value the company between $500 billion and $600 billion, according to Bloomberg. The proposed deal would involve selling roughly a 3% stake, with Cantor Fitzgerald acting as lead adviser.

Chief executive Paolo Ardoino said the company is considering bringing in “a group of high-profile investors to maximize the scale of the company’s strategy across all existing and new business lines,” including stablecoins, artificial intelligence, commodity trading, and communications.

Tether reported $4.9 billion in net profit in the second quarter and says it holds $162.5 billion in reserves against $157.1 billion in liabilities. While insiders caution that valuation targets could shift, a $500 billion figure would put Tether in the same tier as SpaceX and OpenAI, far ahead of rival Circle’s $30 billion market value.

At Unchained, we are working on evaluating whether Tether is actually worth this much. Be sure to subscribe to our Bits and Bips newsletter so you don’t miss the story!

Regulators Probe Trading Ahead of Corporate Crypto Buys

The Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA) are examining unusual trading activity around corporate crypto-treasury announcements, the Wall Street Journal reported. Regulators have contacted some of the more than 200 companies that unveiled plans this year to buy bitcoin and other digital assets with balance-sheet funds.

According to the report, officials raised concerns over sharp stock gains and heavy volumes in the days before some disclosures. SEC staff warned companies about potential violations of Regulation Fair Disclosure, which prohibits selective sharing of market-moving information.

While no enforcement actions have been announced, lawyers noted that such inquiries often mark the start of insider-trading investigations. So far in 2025, companies have raised about $102 billion for crypto-treasury strategies, following the model pioneered by Michael Saylor’s firm, Strategy.

Circle Considers Reversible USDC Transactions to Attract TradFi

Stablecoin issuer Circle is exploring ways to make transactions in its USDC token reversible in cases of fraud or disputes, the Financial Times reported. 

Circle President Heath Tarbert said: “We are thinking through ... whether or not there’s the possibility of reversibility of transactions, right, but at the same time, we want settlement finality.” 

The idea aims to align stablecoins more closely with traditional finance, where refunds are possible, potentially boosting institutional adoption. But it challenges one of blockchain’s core principles: immutability. Currently, Circle can freeze or blacklist addresses but cannot reverse completed transfers.

USDC has a market capitalization of $74 billion, second only to Tether’s USDT. Circle, which went public earlier this year, is also developing its Arc blockchain, designed to support stablecoin applications with sub-second settlement speeds.

FTX Pursues Billions as Estate Prepares New Creditor Payout

The FTX bankruptcy estate is pushing forward on multiple fronts this week. On Monday, the FTX Recovery Trust filed a lawsuit against Bitcoin mining firm Genesis Digital Assets, seeking to recover $1.15 billion allegedly invested with misused customer deposits. Lawyers argue that former CEO Sam Bankman-Fried routed the funds through Alameda Research, with more than half going directly to Genesis co-founders Rashit Makhat and Marco Krohn.

At the same time, FTX confirmed its third major distribution to creditors, totaling $1.6 billion and set to begin September 30. U.S. claimants are expected to reach 95% recovery (based on Nov. 22 prices), while international customers stand at 78%. Payment processors BitGo, Kraken, and Payoneer will handle the disbursements.

Adding to the week’s drama, Bankman-Fried’s verified X account briefly posted “gm,” sending FTT tokens soaring 32%. The account later clarified that a friend manages the posts, as the former FTX chief serves his 25-year sentence.

Cloudflare Introduces NET Dollar Stablecoin for AI Web

Cloudflare has announced plans to launch the NET Dollar, a U.S. dollar-backed stablecoin designed to support transactions in the emerging AI-driven internet. The company said the token will power instant and global micropayments, enabling personal AI agents to handle tasks like booking travel or ordering groceries, while business agents could automate supplier payments.

CEO Matthew Prince described the initiative as an effort to create “financial rails” that match the speed of the modern web, supporting fractional payments to reward originality and sustain creativity. Developers and creators would be able to monetize content, APIs, and applications, while AI companies would be expected to compensate sources.

Cloudflare is also contributing to open standards, including the Agent Payments Protocol and x402, to ensure interoperability. The announcement follows a wave of stablecoin launches after the U.S. passed the GENIUS Act, which provided new regulatory clarity.

Proposal Seeks to Slash HYPE Token Supply by 45%

Crypto investment firm DBA’s co-founder Jon Charbonneau and Flashbots strategist Hasu have introduced a proposal to reshape Hyperliquid’s tokenomics by cutting HYPE’s supply nearly in half. 

The plan would revoke authorization for unminted tokens allocated to community rewards, burn tokens held in the assistance fund, and remove the current supply cap, together reducing supply by about 45%.

According to the authors, the problem lies in how fully diluted valuation, or FDV, is calculated, since it often includes tokens that will never circulate. They argue this inflates supply metrics and distorts valuations, even though existing holders would see no change to their ownership share.

The proposal has sparked debate in the community, with supporters calling it a fix for misleading metrics and critics warning that removing the cap could unsettle supply expectations. Charbonneau also appeared on Unchained this week to discuss the rationale behind the plan.

Kiln Prepares to Stake $6 Billion in Ethereum

Staking provider Kiln is preparing to redeploy 1.6 million ether, worth about $6 billion, after abruptly withdrawing the assets earlier this month. The firm had unstaked its holdings on September 9 as a precaution following a security incident in its Solana operations, which raised fears that Ethereum wallets could also be affected.

“We target early next week to re-enable new ETH validators,” Kiln co-founder and COO Thomas de Phuoc said in an email to Unchained. The move marks the first step before restaking can begin, as most of the ether remains in the network’s exit queue.

The withdrawal caused a backlog in Ethereum’s validator queue, where waits now stretch beyond 40 days. Analysts noted that Kiln’s return could coincide with billions in additional staking from ETFs, treasuries, and retail demand heading into the fourth quarter.

Delay in Quintenz Nomination Puts Clarity Act at Risk

A stalled nomination at the Commodity Futures Trading Commission (CFTC) is raising alarm across the crypto industry, according to a report from Unchained. President Trump’s nominee for CFTC chair, Brian Quintenz, has yet to receive a confirmation vote, leaving the agency with just one commissioner at a critical moment.

The uncertainty threatens progress on the Clarity Act, legislation that would make the CFTC the lead regulator for spot crypto markets. “How does a market structure bill work if the vast preponderance of crypto lands in the jurisdiction of the CFTC…but there’s nobody home?” asked CoinFund president Chris Perkins.

Sources told Unchained the White House delayed the vote following a request from Gemini founders Cameron and Tyler Winklevoss, who previously clashed with Quintenz. With Senate Democrats also pressing for more commissioners from their party, industry leaders warn that the leadership vacuum could imperil both the Act’s passage and its rollout.

Aster Overtakes Hyperliquid in Perpetual Trading Race

Decentralized exchange Aster has surged past rival Hyperliquid in daily perpetual futures trading. On Thursday, Aster recorded $29.5 billion in 24-hour trading volume, compared with Hyperliquid’s $10 billion, according to DeFiLlama. Open interest on Aster also jumped nearly 600% in under a week, rising from $142.7 million on Friday to $1.03 billion by Wednesday, data from CoinGlass shows.

Despite the milestone, Hyperliquid maintains deeper liquidity, with $2.17 billion in open interest and $299 billion in 30-day volume, far exceeding Aster’s $48 billion. Aster’s rapid ascent follows a public endorsement from Binance founder Changpeng Zhao, whose family office YZi Labs is a major backer.

Skeptics have questioned Aster’s decentralization. “They claim to be a DEX, but that’s misleading,” one Hyperliquid investor wrote on X, pointing to the absence of validators or on-chain execution. Originally APX Finance, Aster rebranded earlier this year and launched its ASTER token in September.

Meanwhile, Hyperliquid introduced its native stablecoin USDH on Wednesday, attracting nearly $2 million in trading within hours of launch. 

USDH is the ticker that sparked a competitive process that was eventually won by the ecosystem-aligned startup Native Markets.

Just nine hours after deployment on HyperEVM, USDH surpassed Circle’s USDC in market share, reaching 8.9% and more than $24 million in circulation, according to Dune Analytics. 

Allium data shows 57 active addresses hold USDH, with an average balance of $425,000 and the top two wallets exceeding $10 million each.

CZ Rejects Report of YZi Labs Fundraising Plans

Binance co-founder Changpeng Zhao has pushed back against a Financial Times report claiming his $10 billion venture firm YZi Labs is preparing to raise external capital. “Complete false news from FT, with fake/wrong/made-up info and negative narratives,” Zhao posted on X, adding that YZi “has not sought a single external investor.”

The FT cited remarks from YZi Labs CEO Ella Zhang suggesting the firm could eventually open to outside investors after building expertise in sectors like AI and biotech. Zhao denied this, saying the company “operates independently” and was not spun out of Binance. “There is no demo. WTF is a demo for a fund,” Zhao added, criticizing the report.

In related news, YZi Labs expanded its investment in Ethena Labs as the firm aims to grow its synthetic dollar USDe on the BNB Chain and strengthen institutional partnerships.

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