GeckoPulse: A Big Week for DeFi and Stablecoins!

One ‘Four’ All

After accumulating over $3B in deposits across its V3 markets on Plasma, DeFi lending platform Aave is now looking to release its major V4 upgrade, slated to go live in the final months of 2025.

The platform provided a progress update in early September, which detailed a new modular approach and additional risk controls.

Aave aims to address the problem of liquidity fragmentation by adopting a ‘hub-and-spoke’ design where custom lending markets with different rates can tap into different liquidity hubs.

Additionally, the update will include a new interface that provides an overview of all the available lending markets across hubs.

Besides that, Aave v4 is expected to bring new improvements for risk control by implementing dynamic risk management.

Users will also have the option of using a ‘Position Manager’ contract to automatically repay, borrow or withdraw funds.

Deposits on Aave have grown by 59.8% from $25B to nearly $40B in the past quarter, while the price of its native AAVE token has fallen slightly by 4.4% in the same period.

Cloudflare Joins the Stablecoin Wars?

Content delivery network (CDN) service provider Cloudflare has announced its stablecoin, NET Dollar.

NET Dollar will be mainly developed to facilitate commerce between AI agents and will be fully backed by US-denominated assets.

While not much else has been shared about the stablecoin, the project's website mentions that the stablecoin will be programmable and interoperable between various networks and ecosystems.

No release date has been announced as of yet, but Cloudflare has stated that NET Dollar will be launched soon. 

From DATs to DAT Aggregators

Crypto market maker GSR is planning to change the digital asset treasury (DAT) space by introducing a new DAT ETF.

The firm has submitted a filing to the SEC to set up its Digital Asset Treasury Companies ETF, which offers exposure to companies holding digital assets as part of their treasuries.

According to the filing, the fund will invest at least 80% of its net holdings into these companies under normal operations.

During its initial launch, the ETF will hold equities from around 10-15 different companies, mainly from US-listed firms.

In addition to obtaining these shares from the secondary markets, the ETF may conduct private investments in public equity (PIPE) deals to obtain shares at a discount.

According to data from The Block, DATs currently hold over $120B in BTC, ETH, and SOL.

However, the DAT ETF will not be focused on any specific group of assets, as the filing also mentions companies holding altcoins such as TON, SUI, and LTC.

Keeping it Compact

Uniswap Labs has unveiled the first iteration of a new ERC-6909 smart contract known as 'The Compact'.

The Compact V1 system aims to reduce cross-chain fragmentation through reusable 'resource locks', allowing protocols to leverage a shared framework for building composable token ecosystems.

Users can deposit funds to create a Resource Lock, represented by an ERC-6909 token, which can be used to back multiple commitments from different protocols.

Compact V1 is set to make its debut on UniswapX and will also be integrated into omnichain protocols such as Li.Fi and Rhinestone.

Over the past week, the price of UNI has continued to drop by 19.1% from $9.54 to $7.71 today.

In Other News…

KuCoin Hit With $14M AML Penalty. Crypto exchange KuCoin has been hit with a $14M with a record $14M AML penalty by Canadian authorities. KuCoin previously pleaded guilty to operating an unlicensed money-transmitting business in the US and paid $300M in fines back in January.

South Park Mocks Polymarket. The animation series South Park mocked crypto prediction market places such as Polymarket and Kalshi in its latest episode on Wednesday.

Gate L2 Joins Optimism Stack. Crypto exchange Gate is also launching an ETH L2, following in the footsteps of Coinbase and Kraken. The new L2 “Gate Layer” will be built using the OP Stack, which was also used to build Coinbase’s Base L2.

Aster Reimburses Traders. The recently popular perpetual DEX Aster ran into an issue with its XPL perpetual trading pair. Affected users have been compensated with USDT.

Circle Explores Reversible USDC Transactions. Circle, the USDC issuer is reportedly examining reversible transactions to help recover funds from fraud and hacks. Critics argue that despite the good intentions, this is against the crypto ethos of immutability, where transactions cannot be altered after it is on the blockchain.

USDH Now Live. Hyperliquid’s USDH stablecoin is now live with approximately $2.2M in early trading volume. USDH is issued by Native Markets who previously won the bid for USDH.

Europe’s Stablecoin Consortium. Nine European banks, including ING and UniCredit have formed a consortium to develop a Euro-backed stablecoin. The consortium plans to launch this stablecoin in H2 2026.

Major Ethereum Liquidation. An Ethereum whale “0xa523”, lost $45M worth of ETH after ETH fell below $4000. 0xa523 was leveraged long on the perpetuals DEX Hyperliquid.

3% MET for JUP Stakers. Meteora Co-lead “0xSoju” unveils a proposal to allocate 3% of the MET token to JUP stakers. Solana DEX Meteora is set to airdrop their MET token next month in October.