Aave Experiences Significant Increase in cbBTC Inflows Amid New Incentive Program

The Ethereum-based lending protocol Aave has seen a substantial rise in Coinbase Wrapped Bitcoin (cbBTC) inflows, driven by a new incentive program. This initiative has led to an impressive $200 million weekly increase in cbBTC deposits, reflecting growing liquidity and adoption of the wrapped Bitcoin product on the platform.

Despite this positive trend, market analytics platform IntoTheBlock has raised concerns about potential risks. Users may face challenges in repaying loans if market conditions deteriorate, highlighting the need for cautious optimism.

Overall, the growth in cbBTC on Aave underscores the platform's expanding influence in the DeFi space, with promising prospects for the future.

EMURGO, the blockchain project advancing Web3 adoption on the Cardano blockchain, has announced a strategic collaboration with BitcoinOS (BOS), a smart contract operating system built for Bitcoin. This partnership aims to provide Cardano DeFi users with access to Bitcoin’s $1.3 trillion capital without relying on third-party intermediaries.

The initial technical collaboration involves integrating the BOS Grail bridge into Cardano’s open-source framework, utilizing BOS’s BitSNARK verification protocol. This enables secure and trustless transfers of Bitcoin and associated assets into Cardano.

Cardano becomes the first Layer-1 blockchain to leverage BOS’s scalability and programmability for Bitcoin, allowing DeFi dApps to incorporate trustless BTC functionality. EMURGO CEO Ken Kodama highlighted the potential for new cross-chain capabilities and a more interconnected Web3 environment, driving innovation and DeFi adoption.

Despite the promising collaboration, ADA's market performance remains underwhelming, trading below $0.35.

Kraken, one of the largest digital asset trading platforms, has announced plans to launch its own blockchain, Ink, by early 2025. This new layer-2 (L2) network will be built on the Optimism Superchain, which shares Ethereum’s security and governance standards. Ink aims to facilitate decentralized finance (DeFi) applications, allowing users to trade, lend, and borrow cryptocurrencies without intermediaries.

Kraken’s move into the DeFi space is expected to simplify user experiences and reduce costs. The testnet for Ink will be available later this year, with a full launch planned for the first quarter of 2025. This development positions Kraken alongside other major exchanges like Binance and Coinbase, who have also launched their own blockchains to enhance user engagement and revenue.

Uniswap Labs, the entity behind the leading decentralized exchange Uniswap, has announced the integration of a cross-chain swap bridge developed by Across. This integration will enable users of the Uniswap Wallet and Uniswap Web App to seamlessly swap ether (ETH), Wrapped Bitcoin (WBTC), and stablecoins such as Tether (USDT), USD Coin (USDC), and Dai (DAI) across nine Ethereum Virtual Machine (EVM)-compatible chains, including Optimism, Arbitrum, Polygon, and Base.

Powered by Across' intent-based bridging solution, this new feature simplifies cross-chain transactions by allowing users to specify their desired action in a single transaction request. This approach mitigates the complexities and risks associated with cross-chain transactions, enhancing user experience.

The integration is underpinned by the ERC-7683 token standard, introduced to improve cross-chain interoperability. This standard unifies cross-chain intents and enables a universal filler network to process transactions, allowing developers to focus on one chain while accessing the entire EVM ecosystem.

Uniswap's CEO, Hayden Adams, emphasized that this collaboration aims to set new standards and create an ideal user experience for cross-chain swaps. Across' co-founder and CEO, Hart Lambur, highlighted that intents-powered solutions offer a near-instant experience between layer-2 networks, envisioning a future of seamless, one-click cross-chain transactions.

This development is part of Uniswap's broader strategy, which includes the recent unveiling of its layer-2 network, Unichain. Across will serve as the bridge for Unichain when its mainnet goes live, further solidifying Uniswap's commitment to enhancing cross-chain interoperability.

The integration of Across' bridging solution marks a significant step towards a more unified and efficient DeFi ecosystem, reflecting a positive outlook for the market's future.

**DeFi Oracle RedStone Launches AVS Testnet on EigenLayer**

RedStone, a prominent DeFi oracle provider, has launched its AVS testnet on the Ethereum restaking protocol, EigenLayer. This marks the first instance of an oracle leveraging EigenLayer’s restaking technology to enhance security.

The integration signifies a major advancement for RedStone and the broader DeFi ecosystem. EigenLayer’s restaking model allows RedStone to adjust collateral based on market conditions, providing an additional layer of defense against potential attacks.

By utilizing various types of collateral, including ETH, liquid staking tokens, stablecoins, and BTC, RedStone aims to maintain secure and reliable data feeds. Alan Curtis, COO of Eigen Labs, emphasized the importance of oracles in DeFi and praised RedStone’s adoption of their restaking capabilities.

EigenLayer continues to be a leading player in the restaking ecosystem, with a total value locked of $10.77 billion. Despite a recent security breach on its official X account, the platform remains robust and continues to attract significant attention in the DeFi space.

Kraken Launches kBTC: A Wrapped Bitcoin Token Interoperable With Ethereum and OP Mainnet

Kraken has announced the launch of Kraken Bitcoin (kBTC), a wrapped Bitcoin token fully backed and custodied by the crypto exchange. This ERC-20 token is designed to be compatible with decentralized applications across networks like Ethereum and OP Mainnet, with plans to expand to non-EVM ecosystems.

The token is held at Kraken Financial, a Wyoming-chartered Special Purpose Depository Institution. An independent security audit by Trail of Bits confirmed the robustness of kBTC's smart contract.

With backing from Paraswap, Yearn, Gauntlet, deBridge, and Definitive, kBTC aims to enhance Bitcoin's utility and drive innovation within the DeFi space.

Radiant Capital, a prominent DeFi lending platform, suffered a significant security breach on Wednesday, resulting in losses exceeding $50 million. The exploit targeted the platform’s smart contracts on both the Binance and Arbitrum networks.

Blockchain security firm Ancilia Inc. first detected the breach, reporting suspicious activity on Radiant’s smart contract on the BNB Chain. Hackers drained at least $18 million from the BNB network, with the attack spreading to Arbitrum’s liquidity pools.

The attackers compromised a multisig wallet by obtaining private keys from 3 out of 11 signers, allowing them to upgrade smart contracts and transfer ownership. Radiant Capital has suspended its markets on Ethereum and Base, collaborating with security partners to investigate and mitigate the breach.

Despite this setback, the DeFi sector remains resilient and continues to innovate, underscoring the importance of robust security measures in the evolving blockchain landscape.

World Liberty Financial (WLF), a decentralized finance (DeFi) protocol backed by Donald Trump, launched its public token sale on Tuesday, raising approximately $11.49 million on its first day. This initial figure represents 3.8% of the protocol’s $300 million fundraising target.

Despite falling short of projections, the sale saw significant interest, with over 100,000 whitelist sign-ups. However, only 8,699 unique wallet addresses currently hold WLFI tokens. The project aims to distribute 63% of tokens to the public and will unfold in three phases, including launching a DeFi lending platform and integrating with exchanges. The outlook remains optimistic as WLF continues to attract attention in the DeFi space.

**Runes Protocol Resurgence Boosts Bitcoin Transaction Fees**

Bitcoin has experienced a significant increase in transaction fees due to a resurgence in activity on the Runes Protocol, which launched during Bitcoin's fourth halving event. Recent data from IntoTheBlock indicates that Bitcoin Runes transfers have tripled since August, leading to a 32% spike in transaction fees this week, the highest since August.

This surge in fees highlights a growing demand for block space, benefiting Bitcoin miners who earned $5 million in transaction fees over the past week. Decentralized capital markets protocol Alkimiya reported that Runes transfers now occupy over 50% of Bitcoin’s block space, driving a notable increase in fees.

The Runes protocol, created by Casey Rodarmor, aims to enhance on-chain activity and improve upon the BRC-20 standard. Despite an initial decline in activity post-launch, Runes has maintained steady usage and recently surpassed 50 million inscriptions. This renewed interest underscores the protocol's potential to sustain long-term growth in the Bitcoin ecosystem.

**DeFi TVL Share of Real-World Asset (RWA) Protocols Doubles Since July**

The integration of Real-World Asset (RWA) protocols within the decentralized finance (DeFi) ecosystem has seen a significant rise, now representing 3.69% of the total value locked (TVL), up from 1.77% in July, according to on-chain analytics platform IntoTheBlock.

This growth underscores the increasing tokenization of traditional assets such as real estate, commodities, and bonds, which are being used as collateral in decentralized lending and borrowing protocols. Analysts predict the RWA market could surge from $118 billion to $10 trillion by 2030, driven by clearer regulations and institutional interest.

Key players like Ripple and MANTRA are leading these efforts, with Ripple enhancing XRP Ledger’s interoperability and MANTRA securing $11 million to bolster RWA tokenization infrastructure. This trend is expected to unlock significant liquidity for various asset classes, marking a promising future for DeFi.

EigenLayer's EIGEN Token Launches with $7bn Fully-Diluted Market Cap

In a significant development for the decentralized finance (DeFi) sector, EigenLayer has officially launched its native cryptocurrency, EIGEN. The token debuted with a fully-diluted market cap of $7 billion and is now available for trading on major exchanges including Binance, Bybit, OKX, Kraken, and Uniswap v3.

The Eigen Foundation announced that the unlocking of EIGEN opens new avenues for open innovation, shared security, and network participation. This event is expected to catalyze economic expansion, governance, and protocol development within the EigenLayer ecosystem.

EigenLayer, an Ethereum restaking protocol founded by Sreeram Kannan in 2021, has quickly become a leading DeFi project, amassing over $12 billion in total value locked. The launch of EIGEN is anticipated to further diversify the network's use cases and enhance its role in securing Actively Validated Services (AVSs).

This launch marks a pivotal moment for EigenLayer and the broader DeFi landscape, reinforcing optimism about the sector's future growth and innovation.

Santiment, a leading crypto analytics platform, has recently released its latest rankings of the top 10 Decentralized Finance (DeFi) projects based on monthly development activity. Synthetix Network leads the list with an index of 266.57, followed by dydx (DYDX) with an index of 170.93. Other notable projects include Lido DAO Token (LDO), Injective (INJ), and Osmosis (OSMO).

The methodology employed by Santiment focuses on filtering meaningful programming events across blockchains, emphasizing community size and developer activity. This approach ensures that only substantial development efforts are considered, providing a clear picture of the most active DeFi ecosystems.

Santiment's research highlights the importance of development activity as a key indicator of a project's potential for growth and user adoption. By observing GitHub activity and other development metrics, investors and enthusiasts can gain valuable insights into the health and progress of these DeFi projects.

Overall, the report paints an optimistic picture of the DeFi sector, showcasing robust development efforts and a strong community backing. As these projects continue to evolve, they are likely to drive further innovation and adoption in the blockchain space.

Donald Trump has announced the launch date for World Liberty Financial, a DeFi platform for borrowing and lending, set to debut on September 16. In a video posted on X, Trump invited the public to join him on Twitter Spaces to discuss the project, emphasizing a future-oriented approach to finance that leaves traditional banks behind.

The platform will offer a digital wallet, a credit account system, and opportunities to invest in cryptocurrencies through native tokens. It will prioritize U.S. dollar-pegged stablecoins, aiming to drive mass adoption of decentralized finance and reinforce America's financial leadership.

World Liberty Financial has partnered with DeFi protocol Aave, indicating the project may be built on the Ethereum blockchain. The team is also prioritizing security, with top experts reviewing the platform's code.

Despite mixed reactions, the project is seen as a bold move to align the U.S. with the future of global finance.

**Core Foundation Launches Liquid Staking Token on Bitcoin L2 Network**

The Core Foundation has announced the launch of LstBTC, a liquid staking token backed by BTC on the Bitcoin-backed Layer 2 "Core" network. This ERC-20 token is pegged 1:1 with BTC and accrues daily rewards for holders, paid out in CORE tokens, the native utility and governance token of the Core network.

Rich Rines, an initial contributor to Core DAO, stated that LstBTC will be pivotal in kickstarting Core’s ecosystem by attracting new builders to launch their own liquid staking tokens (LSTs) on Core. This development is seen as a significant step forward for Bitcoin DeFi.

Core is an EVM-compatible Bitcoin sidechain that employs a unique consensus mechanism called "Satoshi Plus," combining merge mining and delegated proof of stake. This allows Core to inherit Bitcoin's security while offering enhanced functionality.

The introduction of LstBTC enables native Bitcoin staking, allowing BTC holders to earn consistent yields from multiple L2 blockchains. Unlike traditional staking, liquid staking offers the flexibility to move and trade BTC while still earning passive income.

While LstBTC is backed by BTC held in a multi-signature wallet on Bitcoin L1, Core DAO assures that rigorous security audits are conducted to protect users' assets. This initiative marks a promising expansion of Bitcoin's DeFi ecosystem.

**Uniswap Labs Fined $175K by CFTC for Unlawful DeFi Transactions**

The U.S. Commodity Futures Trading Commission (CFTC) has imposed a $175,000 fine on Uniswap Labs for unlawfully offering leveraged and margined retail commodity transactions in digital assets. This regulatory action underscores the increasing scrutiny on the decentralized finance (DeFi) sector.

Uniswap Labs was found to have facilitated illegal transactions through its decentralized trading protocol, which allowed users to trade digital assets, including leveraged tokens, without meeting regulatory requirements. The platform has agreed to cease these activities and comply with the Commodity Exchange Act (CEA).

Despite the regulatory challenges, the DeFi sector continues to show resilience and potential for growth. The cooperative stance of Uniswap Labs in this investigation reflects a positive trend towards regulatory compliance, which could foster a more robust and transparent DeFi ecosystem in the future.

Penpie DeFi Platform Suffers Major Exploit, Loses $26 Million

On September 3, 2024, the decentralized finance (DeFi) platform Penpie, operating on the Pendle network, experienced a significant security breach. According to Cyvers Alert, the exploit resulted in the loss of at least $26 million in various wrapped and synthetic crypto assets. The attack was initiated by a smart contract funded with 10 ether (ETH) via Tornado Cash.

Pendle, the underlying network, confirmed the breach and paused all contracts as a precaution. Both Pendle and Penpie are actively working to resolve the issue and ensure user funds' safety. Despite the setback, the DeFi market remains resilient and optimistic about future security improvements.

**MakerDAO Rebrands to Sky, Introducing USDS and SKY Tokens**

MakerDAO, a pioneering DeFi lending protocol on Ethereum, has rebranded to "Sky" following significant upgrades to its decentralized stablecoin system. The stablecoin formerly known as DAI has been renamed to USDS, and the MKR governance token has been changed to SKY.

**From MKR to SKY: Key Changes**

Sky announced that SKY is an upgraded version of MKR, obtainable by supplying USDS tokens to the Sky protocol via Sky.money. 1 DAI can be converted into 1 USDS, and 1 MKR into 24,000 SKY tokens, making individual SKY tokens more affordable.

**Seamless User Experience**

Sky.money will offer non-custodial access to Sky’s tokens and rewards. The protocol allows for seamless swapping of ETH, USDC, and USDT into USDS, with assets remaining in user custody.

**The Evolution of DeFi**

Rune Christensen, MakerDAO co-founder, stated that the rebrand aims to capture the "next evolution of DeFi," focusing on simplicity and ease of use. The rebrand also includes renaming Maker’s "SubDAOs" to "Sky Stars," which will act as the innovation layer.

**Market Impact**

With a TVL of $6.44 billion, Maker remains a leading DeFi protocol. The rebrand to Sky signifies a forward-looking approach, enhancing user experience and expanding DeFi's potential.

**Donald Trump Jr. Sets Sights on Banking Reform with Upcoming DeFi Project**

In a recent Q&A session on Locals, Donald Trump Jr. announced his plans to develop a new decentralized finance (DeFi) platform aimed at addressing banking access inequality. This initiative builds on his father's recent pivot toward the crypto industry, as former President Donald Trump has made Bitcoin a central focus of his presidential campaign.

Trump Jr. emphasized the need to challenge traditional banking systems, highlighting the appeal of DeFi for those who have been "debanked" or faced difficulties in obtaining financing. His brother, Eric Trump, also expressed strong support for the crypto and DeFi sectors, hinting at a major upcoming announcement.

This development comes amidst Donald Trump's broader efforts to position the US as a global leader in the crypto space.

Nexera Protocol Faces $1.5 Million Security Breach, NXRA Token Drops Over 40%

Nexera, a DeFi protocol, recently experienced a significant security breach that resulted in the theft of $1.5 million worth of NXRA tokens. The incident, first reported by blockchain security firm Cyvers on August 7, involved an unidentified address taking control of Nexera’s proxy contract and accessing administrative functions to withdraw all available NXRA tokens.

Following the breach, the value of NXRA plummeted by over 40%, hitting an all-time low before rebounding by 76.5%. This incident underscores ongoing security challenges in the DeFi space, yet market resilience remains evident.

**Aave Demonstrates Resilience Amid Crypto Market Downturn**

Aave, a leading decentralized finance (DeFi) protocol, has shown remarkable resilience during the recent crypto market downturn. Despite a significant sell-off triggered by macroeconomic factors, Aave generated $6 million in revenue, underscoring the robustness of its decentralized liquidation mechanisms.

Founder Stani Kulechov highlighted that Aave managed to secure $21 billion in value across 14 active markets on various Layer 1 and Layer 2 blockchains. The platform's ability to handle multiple liquidations, including a notable $7.4 million wrapped Ether (WETH) position, was pivotal in maintaining market stability.

The broader DeFi sector also showed signs of resilience, with active loans reaching $13.3 billion, indicating a potential rise in leverage and a bullish outlook for the market.