GeckoPulse: Aave's Civil War

This GeckoPulse episode covers March 4-5’s top crypto news. Subscribe to our free daily newsletter to be the first to receive breaking updates!

Aave Chan Exits

The Aave Chan Initiative (ACI), a major governance group of the Aave lending protocol has announced its closure, following its recent dispute with Aave Labs.

This follows the recent departure of BGD Labs, the primary engineering team behind Aave V3, marking a significant loss of two core contributor groups within weeks.

As announced by founder Marc Zeller, ACI’s 8-man team will not be renewing their contracts with Aave and will begin a four-month transition period to hand over its infrastructure and open-source its tools.

Since the announcement, the price of AAVE has fallen by 7.6% from $124.30 to $114.90 today.

Sending It Skywards

DeFi platform Sky has passed and executed a new governance proposal that aims to lower the amount of its native SKY tokens in circulation.

The proposal, which was passed last Friday, and enacted on Monday, includes various new changes to the Sky Protocol.

Firstly, the emission for staking rewards has been adjusted downwards by 16.2%, lowering token inflation by 161.8M tokens over the next 180 days.

Next, the platform has also opted to expand lending activities for USDS by adding two Launch Agents.

These Launch Agents will be in charge of distributing and managing USDS credit and liquidity across the USDS ecosystem.

Additionally, the protocol will be continuing its token buyback program, which has accumulated 1.83M tokens so far, worth approximately $140M.

At its current pace, the buyback program will reduce the total circulating SKY supply by 3.6M tokens daily.

Since the proposal was passed, the price of SKY has surged by 10.3% in the past week from $0.069 to $0.077 today.

Sui Joins the Stablecoin Wars

The Sui network has officially launched its native stablecoin, USDsui, designed to function as a unified digital dollar for global payments and scalable financial services.

According to a recent statement by the Sui Foundation, the stablecoin, also known as the Sui Dollar, will be available across all Sui-based wallets and DeFi protocols.

USDsui will be issued by the stablecoin platform Bridge, and will be compatible with its other deployed assets.

Notably, this Sui stablecoin is designed to be compliant with the approved US stablecoin legislation act, the GENIUS Act.

Since the announcement, the price of SUI has risen slightly by 1.5%.

The Miner Migration Continues

Bitcoin mining firm Core Scientific has highlighted its intention to offload more Bitcoin to fulfil its pivot to AI and high-level computing.

According to its latest SEC filing, the company plans to ‘monetize all of its Bitcoin holdings,’

Most of its Bitcoin holdings will be sold by this quarter, depending on current market conditions.

Not to be left behind, the publicly traded Bitcoin miner MARA also plans to sell more from its holdings, that is worth approximately $3.6B.

The decision to liquidate more BTC stems from the firm’s decision to evolve from purely a Bitcoin miner into a ‘digital infrastructure company,’

However, this recent string of transitions is not a new phenomenon as other Bitcoin miners have started to dump their BTC holdings since last year to capitalize on the exponential growth of the AI sector.

Just last month, firms such as Cango and Keel Infrastructure (formerly Bitfarms) had already sold their Bitcoin to make the jump to AI and high-performance computing.

Meanwhile, Bitcoin has just reclaimed the $70K level, reaching a new weekly high of over $71K. 

In Other News

Kraken Is the First Crypto Bank to Receive Fed Master Account. Kraken, a US-based crypto exchange with banking licenses, has secured a master account from the Federal Reserve Bank of Kansas City. This announcement was met with public outcry from Trad-Fi banking groups for being “risky and inconsistent”.

Anti-Stablecoins Is “Straight Up Anti-American”. Eric Trump slammed US banks for lobbying against USD based stablecoins saying they are “depriving customers of better financial opportunities”. US banks are apparently lobbying to ban 4-5% stablecoin yields through the Clarity Act.

A16z Is Looking For Another $2B. A16z, a prominent investor in the crypto space, is allegedly looking to raise a further $2B in its fifth crypto-focused funding round. To date, the firm has raised $7.6B across its dedicated crypto funds.

South Korea’s Accidental $4.8M Leak. On-chain analytics firm Arkham reports that  South Korea’s National Tax Service accidentally revealed the recovery phrase for a seized Ledger wallet resulting in $4.8M worth of funds immediately moving.

Polymarket Shuts Down All Nuclear Predictions. Amid public outcry and potential regulatory scrutiny, Polymarket has shut down long-running wagers surrounding the likelihood of a nuclear weapon detonating. The Commodity Futures Trading Commission is currently in talks to ban event contracts tied to war, terrorism and assassination.

The Death of Alt Season? According to on-chain analytics firm CryptoQuant, 38% of altcoins are now trading near their all-time lows, worse than the post-FTX period.

POWER’s Death Spiral. Power Protocol, an infrastructure crypto project that supports Web3 gaming projects, wipes out its weekly gains and crashes ~90% in a single day. POWER faces market manipulation allegations as the token encounters bridging issues.