What’s up fam

Welcome to this week’s newsletter—your go-to source for all things crypto. Whether it's the SEC keeping Galois Capital in check, whistleblowers shedding light on Illuvium's struggles, or SamsungNext making big moves in crypto, there’s never a dull moment in the space.

This week, we’re also diving into some spicy project updates—Trump’s DeFi project on Ethereum and Aave? Penpie’s post-hack revelations? It’s all here. Plus, we break down what the market’s eyeing as we head toward the next Fed FOMC meeting, and why September’s historically tough month for Bitcoin might present some golden buying opportunities for Q4.

From new launches to token unlocks, and a community-driven data ledger like Jeet.so that’s got us all talking—this week is packed with insights you don’t want to miss.

Let’s get into it! 👇️ 

🔑 KEY NEWS

MAJOR HEADLINES

• SEC Charges Galois Capital: Crypto-focused advisory firm faces custody failure allegations.

• Whistleblower Exposes Illuvium: New insights on why the project is struggling.

• Nvidia's Earnings Surge: $30B revenue reported in Q2, driven by data center growth.

PROJECT UPDATES

• Penpie Hacked: Postmortem analysis released by Pendle Finance.

• SamsungNext Invests in Startale: Soneium infrastructure development ramps up.

• Trump’s Defi Project: Reportedly set to build on Ethereum and Aave.

• Canto Drama Unfolds: A concise breakdown from Colin Platt.

• Aave Introduces Sky Aave Force: Exciting new developments for Aave users.

• Royco Protocol Launches IAM: The Incentivized Action Market is here.

INTERESTING PROJECTS

• Paladin: A new Solana MEV project, focusing on maximizing extraction efficiency.

• Bera-tec: Berachain's NFT project gains traction.

• Dahlia Protocol: An emerging money market in the DeFi space.

• SynStation: A liquid staking project built on Soneium, offering unique incentives.

🛰️ Smart Farmer Surveillance

This week we have our trusty sleuth Amir back in action! Over to him 👇️ 

I'll dive into different chains and ecosystems and share the best strategies smart farmers use. From low-risk farms with 10% APR to volatile strategies yielding 70% APR, let's dive in:

• The ETH/USDC pair on Aerodrome has been the most popular farming pair among smart farmers. The high TVL and stable rewards as a result have been the main reason for its popularity.

  • APR → 10.42%  

  • TVL → $63m

• Velodrome V2 on MODE has also caught some interest, especially the MODE/ETH pair. Many farmers who received the $MODE airdrop have held onto their tokens and developed this strategy to make decent gains on their idle coins.

  • APR → 73.87%

• Some smart farmers are depositing stETH on Fuel Network. Speculation on Fuel points has been driving up its TVL recently. 👀

• Supplying USDC+AERO on Tarot (Base) is one of the most interesting and high APR strategies we've seen so far among smart farmers on BASE. (This strategy involves only supplying assets, without borrowing.)

  • APR → 59% (without leverage)  

  • TVL → $2.69m

• The most commonly used protocol among smart farmers recently has been Morpho Blue. Why do you think that is? Maybe it’s the $Morpho incentives? Or maybe the good rates?

• Aave on Scroll has also absorbed TVL from many smart farmers. Having the biggest DeFi protocol on tokenless L2s like Scroll is a huge blessing for airdrop farmers and yield farmers alike. 👨‍🌾 🪂

🔍️ MARKET WATCH

WHAT’S TO COME THIS WEEK

Polygon's MATIC is transitioning to the POL token and has fallen 20% in the past week and 25% year-to-date, while Bitcoin is up 40% this year. Additionally, the release of ISM and NFP data this week is crucial for the upcoming Fed FOMC meeting.

The market has 3 FOMC meetings before December: 

Sept 17/18, Nov 6/7, and Dec 17/18.

Important events the Fed will be watching:

• NFP this Friday

• ISM data

• CPI

Currently, the market expects a 25bps cut to start.

A month ago, there was a 75% chance of a 50bps cut in September.

A 25 basis point rate cut could signal the start of a standard rate-cutting cycle, potentially boosting BTC prices. But September is historically the worst month for BTC/Stocks. 

Buying September dips to build Q4 exposure has historically been a strong strategy.

DATA BITES

Unlocks

Token unlocks are set to drop to $380 million this week, down from $471 million last week. September's unlocks will rise to $1.94 billion, from $1.5 billion in August. Historically, during the February/March unlocks of $4 billion, Bitcoin gained 55% despite significant unlocks, whereas altcoins underperformed.

In August, only $SUI performed well among the token unlocks, with a cumulative return of 45%. Whilst SUI had $45 million in unlocks, XRP, with $600 million in unlocks, ended up with nearly breakeven returns.

Uniswap vs. CFTC

CFTC issued an order against Uniswap Labs for offering illegal digital asset derivatives trading. The order required Uniswap Labs to pay a $175,000 civil monetary penalty and to cease and desist from violating the Commodity Exchange Act (CEA), as charged. Uniswap immediately settled with the CTFC where the price recovered.

Uniswap generates millions in fees daily, $175k is just a few hours of fees.

📈 HTF PRICE ACTION

Gm frens!

Another week of boring chop and no new price developments. I’m going to stick to the weekly chart for now until things change.

• Overall bullish market structure

• Currently consolidating

• Expectation is bullish

On low timeframes (we’re talking minutes here) this is a market worth shorting as the orderflow is clearly going down right now. But from a HTF perspective, we’re waiting for the LTFs to align with the HTF direction - bullish. But that is not happening anytime soon. Until then -

Trade responsibly and I’ll see y’all next time!

🎁 NEW PRODUCT TESTING

Community-contributed datasets are one of the oldest use cases for crypto in general. Over a period, we’ve seen these manifest in various ways, especially in DeSci with HairDAO, with various protocols rewarding contributions to GitHub, etc. In web2, Wikipedia and interest-based wikis are also notable here.

Last week – I tried Jeet.so which aims to be a community-contributed ledger of influencer shill returns. The premise behind Jeet.so is simple: If a Twitter influencer suggests a buy signal on a coin, any user can report that by tagging @jeetdotso followed by the coin’s ticker. An example is presented below:

On the backend an index is made of the Twitter account of the influencer, the coin suggested, and the timestamp of when the advice was made to create a running portfolio of that influencer. Presented below is an example of the same:

On the backend, a timestamp is posted to Irys, which is a data chain for provenance. This is one of the first consumer applications being built on Irys. Users can also see the provenance for themselves as presented below:

Personally, this has use cases across all social media in crypto and otherwise, as we rise of finfluencer culture through TikTok, Telegram, etc. It’s possible to create and attest reputation to influencers who offer financial advice and hold them more accountable because these calls cannot be deleted once on the blockchain.

Currently, the project is under alpha testing. The first testing had a $200 bounty where users needed to tag new accounts who’d explicitly made buy calls of tickers and had more than 10,000 followers. Every successful tag had a $1 price given out to the reporting user. There is also a slashing mechanism if a repeat influencer gets tagged. 

However, they have closed the Twitter tagging, and the second testing was done via submission of links on the website. I am assuming this is because Twitter APIs are expensive to work with. Nonetheless, the team is working on fixing the mechanic for the full launch.

OUR ECOSYSTEM ALIGNMENT

⚔️ A CALL TO ARMS

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We are always looking for well-connected, talented, or simply hungry contributors who can get involved across a range of activities.

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And that’s a wrap for this week!

As we wind down, remember that crypto is more than just a market—it’s a community. Whether you're deep into the market chop or patiently waiting for that next big move, we're all part of this exciting, sometimes unpredictable journey. This week’s insights have shown us that even during market consolidation, plenty is happening behind the scenes—from regulatory shake-ups like the Uniswap vs. CFTC battle to community-driven projects like Jeet.so pushing the boundaries of accountability.

September might be tough historically for BTC and stocks, but it also presents unique opportunities to build Q4 exposure. Keep your eye on the Fed’s rate decisions and don’t sleep on those token unlocks—altcoin performance could surprise us yet again.

Thanks for sticking with us. Be sure to follow us on Twitter @Castle__Cap for live updates, and as always—trade responsibly, stay curious, and we’ll catch you next week for more alpha, more insights, and more vibes.

In our newsletter, we may discuss projects or tokens in which we hold positions. While we aim to provide informative content, our views are not financial advice. Please conduct your research and consult professionals before making investment decisions. Crypto markets are volatile, and past performance doesn't guarantee future results. Invest responsibly, and be aware of the risks. Your capital is at risk, and we do not accept liability for any losses.