Weekly Recap: The Round Trip

gm, Defiers!

Bitcoin finished the week about where it started, after a round trip through $80,000.

The tape ran up into Thursday, when bitcoin cleared $80,000 and Schwab said it would add Solana, Avalanche and Chainlink to a retail menu that has carried only bitcoin and ether since May. Friday undid it. Kevin Warsh used his first Jackson Hole speech as Fed chair to put the central bank’s focus on prices, saying it has “work to do” on inflation, and bitcoin fell to $76,845.71 before settling near $77,955. Gold dropped 2.35% with it.

Solana had the better week. Validators approved doubling the network’s disinflation rate in the first measure to pass through onchain governance, with Kraken’s larger validator swinging about 8.1 million SOL from against to for in the closing hours. Bitwise’s BSOL became the first Solana ETF past $1 billion. SOL ended the week up about 15%.

The infrastructure news was worse. A shared bug in the Cosmos EVM module drained three chains and left two frozen, Core Lightning told node operators to go offline with no patch published, and Moonwell, Term Finance and The Sandbox each lost seven or eight figures. Friday closed with an attacker still draining the Solana neobank Avici.

In court, the Ninth Circuit held that Kalshi’s sports event contracts are not swaps, reading the same statute the Third Circuit read in April and reaching the opposite answer.

Enjoy!

Bitcoin Round-Trips $80,000 as Warsh Talks Inflation

Bitcoin cleared $80,000 on Thursday and gave almost all of it back on Friday, falling as low as $76,845.71 after Kevin Warsh’s first Jackson Hole address as Fed chair. “Here is my standard: We must be confident that underlying inflation is moving to our objective, clearly and at sufficient speed,” Warsh said. “Otherwise, we have work to do.” The 12-month change in the PCE price index stands at 3.7% and the six-month change at 4.1%. Bitcoin ended the week at about $77,955, up 0.7% over seven days after touching $81,479.50 overnight Thursday. Gold fell 2.35% and the Nasdaq Composite 0.36% alongside it, and Polymarket now prices a quarter-point September hike at 28% against 1.7% for a cut.

Solana Validators Cut Emissions in the First Onchain Governance Vote

SGP-0002 passed with 72.7% support once abstentions were stripped out, the first measure to clear Solana’s new onchain governance system and the first time validators have agreed to reduce issuance. Six hours before the close it was failing at 65.4%. Kraken’s larger validator, holding 8,917,576 SOL, had voted 100% against on Friday morning and re-cast at 10:37 UTC as 90.34% for; Galaxy swung from 92% abstain to 58.36% for. The proposal raises annual disinflation from 15% to 30%, removing an estimated 18.9 million SOL from emissions over six years and pulling the 1.5% terminal floor forward to 2029 from 2032. Figment voted 17.07 million SOL against and Everstake 7.96 million, with first-year staking yields dropping to 4.34% from 4.93%.

The Ninth Circuit Splits With the Third Over Kalshi

The Ninth Circuit held that Kalshi’s sports event contracts are not swaps, affirming the dissolution of the injunction that had shielded the prediction market from Nevada’s gaming laws. Judge Ryan Nelson wrote that whether the Super Bowl happens is the occurrence of an event, while whether a particular team wins it is the outcome of one. The panel also found Kalshi’s self-certification of the contracts unlawful under the CFTC rule barring event contracts that reference gaming. The Third Circuit read the same statutory text in April and reached the opposite conclusion, leaving New Jersey preempted. Both rulings came on preliminary injunctions, and two federal appeals courts now disagree about one company’s product.

A Shared Cosmos EVM Bug Drained Three Chains

Cosmos Labs told every public chain running its Cosmos EVM module below v0.6.2 or v0.7.2 to halt immediately and upgrade, after attacks on MANTRA, TAC and KiiChain between Aug. 20 and Aug. 22. KiiChain put its loss at 148 million KII, roughly $9.7 million, taken by repeating one technique 18 times: the attacker precomputed the address its exploit contract would deploy to, converted that address into a vesting account, then delegated one wei more than the contract could spend and underflowed its mirrored EVM balance. KiiChain says Cosmos Labs published a fix for one of three defects in a public repository on Aug. 19 without telling downstream chains, and that the other two remain unpatched upstream. TAC has been frozen since Aug. 22 with about 62% of circulating supply moved between accounts; MANTRA is back online on a patched binary.

Ethena Puts All of Its Net Revenue Behind ENA

The Ethena Foundation opened a Snapshot vote to route effectively all net revenue across Ethena-branded businesses into programmatic ENA buybacks, with Risk Committee approval and no stated closing date. A Master Framework Agreement assigns protocol intellectual property and accrued value to the Foundation, governed by ENA holders, with Labs equity investors keeping no residual claim on protocol cash flow. The Foundation also bought out the remaining locked ENA held by seed investors who had been selling for nine months, and agreed with lead investors to release unvested venture tokens so the monthly unlocks stop. It named no investors and disclosed no price. Ethena’s token-transparency filing describes Labs as a Portuguese company that provides services to the Foundation and holds no ownership interest in it.