13 June 2025

Oh well, it was all going well. Bitcoin was at $110,000. Ethereum was showing strength. Hyperliquid was outdoing the market. All bullish. Then, Israel strikes Iran. And boom, flash crash!

We hope that the markets will brush this geopolitical uncertainty off soon and continue on its growth path. We are weary of end of June being bearish seasonally. But, we always believe this year it will be different.

Before today, the talk of the town was the resurgence of DeFi protocols and associated assets. We cover one such project in our Hot Take today – Aave.

Top-3 stories of the week:

1

2

3

The newsletter is put together by Giottus Crypto Platform. You can read all the previous issues of Cryptogram here.

Was this newsletter forwarded to you?

WEEKLY MACROS

• Total crypto market cap - $3.24 trillion - UP 0.3%    

• Bitcoin price - $104,093 - UP 0.6%

• The dollar index (DXY) - 98.23 - DOWN 0.7%

• Bitcoin Dominance - 64.82% -  UP 0.3%

• Crypto Fear and Greed Index - 61 - Market is in Greed

THE HOT TAKE

AAVE leads DeFi’s charge in June

AAVE lit up the charts early this week, rallying from a low of $240 to a high of $319, a solid 32% jump. Trading volumes have surged over 200%, with daily turnover crossing $800 million, firmly placing AAVE back in the spotlight.

With protocol metrics like staking, TVL, and open interest pushing toward new highs, AAVE is making a strong case as one of DeFi’s top performers.

We’ll unpack the drivers and implications behind AAVE’s explosive move in today’s deep dive.

Aave partners with Sony’s Soneium L2 Chain

Earlier this week, Aave (AAVE) announced its integration into Sony Group’s new Ethereum Layer 2 chain, Soneium. This partnership marks a key expansion move for Aave into consumer-facing Web3 ecosystems. By joining Soneium, Aave positions itself to reach a wider audience beyond traditional DeFi users, tapping into a 7-million user base already active with platforms like Uniswap v4, Velodrome, and Lido. With Sony’s backing, this launch represents a major opportunity for Aave to go mainstream.

The partnership also brings GHO, Aave’s overcollateralized stablecoin, into focus. Real-world use cases like payments, savings, and digital commerce are being explored on Soneium. As stablecoins with credible backing gain adoption, this move could boost protocol usage and drive renewed interest in the AAVE token itself.

Aave DAO activates ‘Umbrella’ — Autonomous on-chain risk management

Another important development this week is the launch of Umbrella, Aave’s new on-chain, fully automated risk management system. It replaces the legacy Safety Module and enables staked tokens such as aUSDC, aUSDT, aWETH, and GHO to be burned instantly to cover protocol shortfalls. No governance votes are needed - Umbrella responds in real-time.

Stakers continue earning lending yield and extra protocol rewards, while only taking on risk specific to the asset they stake. This makes the system both efficient and targeted. With smart incentives and built-in safety buffers, Umbrella is expected to make Aave more resilient over time and set a new benchmark for DeFi risk protection.

Trump-Linked WLFI taps Aave for loans

Aave also caught attention this week after World Liberty Financial (WLFI) — a Trump-linked DeFi venture — borrowed $7.5 million USDT via Aave, backed by over $44 million in ETH, WBTC, and stETH collateral. While WLFI has not publicly disclosed the loan’s purpose, analysts suggest it may support the rollout of its new USD1 stablecoin.

This isn’t a one-off event. WLFI is becoming a deep integration partner. They’re building their own instance of Aave V3, committed to sharing 20% of protocol fees with AaveDAO and allocating 7% of their token supply to the DAO. Combined with a $1M+ investment into AAVE, this signals strong institutional alignment and adds to the positive sentiment around the token’s recent surge.

Plasma announces partnership with AAVE

In another major integration, Plasma, a zero-fee blockchain purpose-built for stablecoins, revealed that Aave would be a day-one launch partner. Backed by names like Peter Thiel, Tether’s CEO, and major crypto VCs, Plasma is already making waves - its $1 billion deposit cap was filled in just 30 minutes.

What sets this apart is Plasma’s focus on underserved users and regions, aiming to offer permissionless financial tools in places where traditional banking fails. The integration also includes collaborations with Lens Protocol, Horizon, Stani Kulechov, and Aave Chan Initiative, all working together to scale adoption of USDF and bring real-world utility to DeFi. With yield campaigns already active on Plasma via Aave, this partnership could become a key driver of the next big wave in onchain financial adoption.

Avara founder meets Bo Hines amid DeFi regulatory talks

Adding a regulatory dimension, Avara founder Stani Kulechov met with Bo Hines, Trump’s adviser on digital assets, at the White House last week. The meeting coincided with the SEC’s DeFi roundtable, where Chair Paul Atkins proposed a conditional exemption framework for DeFi products. This suggests growing bipartisan interest in crafting clearer regulatory paths for decentralized finance — a potential long-term tailwind for protocols like Aave.

Protocol sees major growth in TVL and lending

As of this week, Aave’s Total Value Locked (TVL) has climbed to over $25.5 billion, reinforcing its position as the largest liquidity protocol in DeFi with 20–21% of market share. On the lending side, borrowed volume has surpassed $16.7 billion, a new all-time high — a signal that user activity and capital efficiency are trending upward.

Technical structure remains bullish

AAVE printed a bullish engulfing candle this week and marking its strongest daily close since early February. Price has dipped today to critical resistance at $270. If crypto recovers soon, AAVE can aim for a daily close above $300 which would likely trigger the next leg higher toward $320, a key psychological and technical level. Beyond that, the 78.6% Fib level at $348 serves as the next upside target if bullish momentum persists.

On the indicators front

• MACD histograms have flipped green, confirming positive momentum buildup

• Daily RSI has reset near 55, showing room for growth

Key levels to watch

• Support: $265

• Resistance: $300 (psychological), $348 (Fib target)

If RSI stabilizes above 60 without a sharp rejection and MACD confirms its signal, AAVE could continue leading the DeFi sector rally.

Key Takeaway: Quiet Moves, Loud Intentions

This week’s developments paint a clear picture - Aave isn’t just riding a price wave; it’s expanding on all fronts. From major partnerships with Sony’s Soneium and Plasma, to high-profile integrations with WLFI, to launching the Umbrella risk framework and actively participating in US regulatory discussions, Aave is aggressively cementing itself as DeFi’s institutional bridge.

Add in surging TVL, record lending, and strong technicals - and it’s evident that AAVE’s momentum is not just hype, but backed by real growth and long-term positioning.

Was this newsletter forwarded to you?

If you have any questions or feedback for us, write to us at [email protected]. You can check out the previous issues here.

Disclaimer: Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. Please do your own research before investing and seek independent legal/financial advice if you are unsure about the investments.