Aave Rift, Bitcoin Rebound and ETF Inflows Dominate Crypto Week
Bitcoin and major cryptocurrencies recovered this week following the initial shock waves of the US-Israel conflict with Iran.
Bitcoin (BTC) initially fell to $63,245 on Sunday, before briefly recovering to $73,000 on Thursday, helped by renewed demand from U.S.-listed Bitcoin exchange-traded funds (ETFs), which posted a net weekly gain of $1.1 billion through Thursday.
In the wider DeFi space, Aave's governance controversy continues, with the Aave Chan Initiative (ACI) not renewing its relationship with Aave DAO and planning to cease operations within the next four months.
The Ave Chan Initiative was forced to withdraw from the Ave DAO due to a management conflict
ACI, the main governance delegate and service provider in the Aave ecosystem, has said it will not renew its relationship with the Aave DAO and plans to wind down within the next four months.
In a statement on Tuesday, ACI founder Mark Zeller said the organization will continue to conduct governance activities and complete advanced commitments before transferring its infrastructure and responsibilities to DAO or successor providers.
“The Aave Chan Initiative was created for Aave. If there is no future in the Aave ecosystem, the name no longer applies. “ACI will be concluded when our obligations are fulfilled,” Zeller wrote.
ACI said its decision to withdraw was due to changes in governance standards and voting during the proposal process, which marked a significant change in Aave's governance landscape as the funding plan moves to the next stage.
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Strive Strategist Says AI Deflation Could Push Bitcoin To $11 Million By 2036
An artificial intelligence-led technological decline could push bitcoin above $10 trillion within a decade and help put pressure on central banks to expand the money supply, according to a report by Strive strategist Joe Burnett.
Burnett, Strive's vice president of Bitcoin strategy, said in a report published Monday that rapid productivity gains from AI will drive down prices on goods and services, squeeze profit margins and prompt policymakers to respond with continued monetary expansion. His “basic case” calls for Bitcoin (BTC) to reach $11 million in the first quarter of 2036, he wrote.
“My starting issue for Q1 2036 is $11 million per bitcoin.”
The forecast rests on a set of wild assumptions, including that Bitcoin will grow by about 12% of the value of global financial assets and that global wealth will increase by 7% annually until 2036.
The prediction implied that Bitcoin would become the dominant global reserve asset in the next decade with a structurally loose monetary policy, Nick Puckrin, co-founder and chief market analyst of the educational platform Coin Bureau, told Cointelegraph.
The forecast suggests that Bitcoin will increase to about 10 times the current US M2 money supply, four times the size of today's US equity market, and double the current global GDP.
The forecast implies a compound annual growth rate (CAGR) of around 53% per year, which is unprecedented considering Bitcoin's average 60% CAGR between 2015 and 2024, but a slowdown can be expected due to its large market capitalization, Pukrin added.
Sean Young, principal analyst at MEXC Research, agreed, warning that the forecast shows a “massive” 16,318% increase for Bitcoin over the next decade, which seems unlikely due to Bitcoin's reduced volatility.
“The more liquidity flows into the asset from institutional and retail investors, the smaller price increases will be recorded,” the analyst told Cointelegraph.
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Stablecoin returns to $1.7 billion as Washington fights over product laws
Weekly net stablecoin revenue rose again last week, despite concerns from US lawmakers and banking groups over whether third parties should be allowed to pay for stablecoin production.
On a weekly basis, net stablecoins increased to $1.7 billion, a 414.5% increase over the week, according to a report published on Wednesday.
The rebound pushed the 30-day moving average to a positive $162.5 million daily gain. Transaction volumes increased by 6.3%, while average transaction volume continued to decline, reflecting renewed demand for a stable coin supply and “intensified” on-chain activity among retail investors, the report said.
Stablecoin introduces net new stablecoins into circulation after registering for redemptions.
At the beginning of the year, the weakness follows a weak period. Messari's data two weeks ago showed weekly revenue of $249 million and net inflows of $4.4 billion in the 30 days to February 18.
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Solv protocol offers 10% bonus after $2.7 million exploitation
One of the token vaults of Bitcoin-based decentralized financial platform Solv Protocol was hacked for $2.7 million and offered the attacker a 10% bonus to return the stolen funds.
Solv said on Thursday that less than 10 of its users were affected by the X post, but it covers the loss of 38.05 Solv Protocol BTC (SolvBTC), which is the symbol for Bitcoin (BTC).
The project added that it has taken steps to prevent the attack from happening again and is investigating the exploit with the companies Hypernative, SlowMist and CertiK.
Solv allows users to save Bitcoin to the Solv Protocol BTC, which can then be used to borrow, lend or share on other blockchains. The project claims to have 24,226 bitcoins worth more than $1.7 billion and is the largest onchain Bitcoin reserve.
Solv did not confirm how the exploit occurred, but two crypto security researchers said it stemmed from a vulnerability in one of Solv's smart contracts that allowed the attacker to overgenerate the token used in the protocol.
The attacker exploited the vulnerability 22 times before exchanging hundreds of millions of tokens for more than 38 SolvBTC, according to CD Security co-founder Chris Dior.
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BayBit Stops $300 Million in Risky Withdrawals in Q4 2025
Bybit has blocked or disrupted more than $300 million in suspected fraud-related withdrawals in the fourth quarter of 2025 after deploying an AI-powered risk monitoring system designed to flag malicious transactions before funds leave the exchange.
In a company blog post, ByBit said withdrawal requests reached $500 million in the quarter and that more than 4,000 users were “protected” after the platform issued real-time risk alerts or blocked transactions.
David Zhong, head of group risk control at BayBit, told Cointelegraph that the $300 million total reflects withdrawals that users voluntarily canceled after seeing warnings, meaning the funds remained in their accounts instead of being damaged or demanding compensation.
“Since the funds are stopped before completion, the funds do not need to be returned or compensated. They always remain in the user's account.”
According to Bibit, the system identified 350 top investment fraud addresses last quarter, protecting 8,000 users from potential losses. In the year It has thwarted more than 3 million credentialing attacks attempted by hackers in 2025.
Hackers are turning their attention to larger crypto entities, and by 2025 Cryptocurrency hacking will result in $3.4 billion in losses.
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Overview of the DeFi market
According to data from Cointelegraph Markets Pro and TradingView, most of the 100 largest cryptocurrencies by market capitalization ended the week in the green.
The River (River) token was the week's biggest gainer, rising 94 percent, followed by the Humanity Protocol (H) token, which rose 39 percent last week.
Thanks for reading this week's roundup of the most impactful DeFi developments. Join us next Friday for more stories, insights and lessons about this dynamic and evolving space.
