Aave has deployed its V4 lending infrastructure on Avalanche, extending the protocol’s newest market architecture beyond Ethereum for the first time. The move is positioned as a foundation for lending pools that can be tailored to different collateral types—potentially including tokenized real-world assets—while still benefiting from shared liquidity across the Aave network.

Announced as the start of a broader rollout, the Avalanche launch introduces Aave V4’s “Hub & Spoke” model. In this setup, specialized lending markets can set their own collateral requirements and risk parameters, but draw on liquidity routed through Aave’s overarching infrastructure.

Key takeaways

• Aave V4 is now live on Avalanche, representing the protocol’s first expansion of its latest lending framework beyond Ethereum.
• The Hub & Spoke architecture lets new lending markets define custom collateral rules and risk settings without fragmenting liquidity.
• Aave says one of the early Avalanche markets is planned to support borrowing against tokenized assets.
• Aave is the largest decentralized lending protocol by total value locked, with nearly $14 billion across 23 blockchains, per DeFiLlama data.

Why Aave’s Hub & Spoke design matters on Avalanche

The core promise of Aave V4’s Hub & Spoke approach is flexibility: different lending markets can be configured for distinct collateral profiles while remaining connected to a common liquidity backbone. For users, that can mean a wider selection of supported collateral types and potentially more tailored risk controls. For builders and market creators, the model is designed to make it easier to launch specialized credit markets without starting from scratch on liquidity and protocol-level plumbing.

According to Aave, the architecture is intended to support a broader range of collateral than earlier protocol iterations. While Aave has long relied on established DeFi-native assets, the V4 approach is explicitly oriented toward accommodating more complex collateral arrangements—an area that has become increasingly important as tokenized financial assets move closer to mainstream on-chain use.

Tokenized assets as collateral: from concept to configured markets

Aave says that, among the first markets planned on Avalanche, it will support borrowing against tokenized assets. The protocol also indicates that future specialized markets on Avalanche could extend to tokenized categories such as US Treasurys, money market fund shares, private credit, and corporate bonds—each with customized collateral requirements and risk parameters.

That framing reflects a larger shift in the way tokenized real-world assets are being used. Rather than limiting tokenization to settlement or trading, institutions and blockchain infrastructure providers are increasingly focused on collateral use cases—where tokenized holdings can back borrowing and liquidity strategies in both traditional and decentralized finance.

For example, Cointelegraph previously reported that Franklin Templeton partnered with Binance in February to enable institutions to use tokenized money market fund shares as off-exchange collateral, while keeping the underlying assets in regulated custody. In the following month, Nasdaq announced plans to integrate its collateral management tooling with Talos’ digital asset infrastructure to streamline institutional workflows for managing tokenized collateral, combining collateral management, risk monitoring, and trade surveillance.

Other infrastructure firms are also aiming at the “operational layer” required for real-world asset collateral. In May, DTCC said it would integrate Chainlink technology into its tokenized collateral platform to support near real-time movement, valuation, and settlement ahead of a planned launch in the fourth quarter.

A broader institutional push meets DeFi lending demand

Aave’s Avalanche deployment arrives as the institutional ecosystem around tokenized assets keeps expanding. The latest wave is not only about issuance or custody, but about creating systems that can actually support borrowing, valuation updates, and risk controls in a way that financial institutions find usable.

More recently, Grove announced a $500 million warehouse lending facility with Galaxy Digital to finance institutional crypto-backed loans using blockchain-based infrastructure. While not directly tied to Aave V4, the move fits the same direction: institutions are building facilities and partnerships that rely on tokenized or blockchain-based infrastructure for collateral-backed lending.

At the same time, the category of tokenized real-world assets continues to grow. According to RWA.xyz, more than $34 billion worth of real-world assets are currently tokenized on public blockchains, up from about $12.8 billion a year earlier—an expansion that suggests collateral-backed DeFi markets may have more potential counterparties as the supply of tokenized assets increases.

What investors and users should watch next

With V4 now launched on Avalanche, the next questions are less about whether tokenized collateral is possible and more about how quickly specific markets go live and what collateral configuration details look like in practice. Readers should watch for Aave’s early Avalanche market rollout, signals about supported collateral types, and how the Hub & Spoke model performs as more specialized lending pools are introduced.

DeFi lending has historically been constrained by which assets can be supported efficiently and how risk parameters are enforced. Aave V4’s architecture is designed to reduce those barriers—so the key test will be whether tokenized collateral markets can scale with appropriate risk controls without sacrificing liquidity.

BlackRock’s iShares Bitcoin Trust has secured a major regulatory win after the U.S. Securities and Exchange Commission approved a fourfold increase in the ETF’s options position limit from 250,000 to 1 million contracts.

According to a notice published by the U.S. Securities and Exchange Commission, a rule change submitted by NYSE Arca has become effective immediately, allowing the exchange to raise the position and exercise limits for options linked to the iShares Bitcoin Trust ETF.

The regulator said the filing was made under Section 19(b)(1) of the Securities Exchange Act and Rule 19b-4 while continuing to seek public comments on the proposal.

The approval gives traders access to significantly larger options positions tied to the world’s largest spot Bitcoin ETF by assets. It also arrives as institutional interest in U.S. spot Bitcoin ETFs continues to grow, with IBIT remaining one of the strongest-performing funds in the category over recent months.

NYSE Arca says trading growth justified the increase

NYSE Arca stated in its filing that the previous 250,000-contract limit no longer matched trading activity in IBIT options. The exchange argued that increasing the cap to 1 million contracts would better accommodate current market demand while allowing market makers to manage inventory and hedge positions more effectively.

The exchange also noted that the revised limit is consistent with similar changes already recognized for competing options venues, including Nasdaq ISE, Nasdaq PHLX, and BOX Exchange. By aligning the limits across exchanges, NYSE Arca said participants would be able to trade under a more consistent regulatory framework.

Although the SEC allowed the proposal to take effect immediately, the agency said it will continue accepting public feedback before reaching a final conclusion on the filing.

For institutional investors, the higher ceiling removes a practical restriction that could limit large hedging or trading strategies. According to NYSE Arca’s filing, expanding the available contract limit should support smoother options trading without forcing large participants to divide positions because of exchange-imposed caps.

BlackRock earnings add to positive momentum

The regulatory decision has arrived shortly after BlackRock released its fiscal second-quarter 2026 earnings. The asset manager reported a 31% year-over-year increase in revenue and announced plans to raise its quarterly share repurchase target to $550 million, adding another positive development for the firm’s investment business.

At the same time, IBIT has remained in focus after recording strong investor inflows over the past week, reinforcing its position as one of the largest spot Bitcoin exchange-traded funds in the U.S. market.

BlackRock has also expanded its presence beyond crypto ETFs. Earlier this week, the firm joined the Depository Trust & Clearing Corporation tokenization pilot alongside JPMorgan Chase and Goldman Sachs to explore blockchain-based settlement for stocks and U.S. Treasuries.

While traditional exchanges continue expanding Bitcoin ETF derivatives, tokenized equity trading is also gaining traction on blockchain-based platforms, giving crypto investors additional ways to access equity exposure.

The SEC’s latest approval applies specifically to regulated options listed on NYSE Arca and does not affect trading rules for tokenized securities.

Coinbase’s Jesse Pollak said he is stepping back from leading the Base app after acknowledging that his bet on an onchain social economy failed to drive crypto adoption as he had expected.

The Base creator said he had spent the last two years betting that builders and onchain-native social experiences, including Farcaster, Zora, mini apps and creator coins, would fuel crypto’s next growth wave. But in a post on X on Wednesday, he said while developers did spur adoption through products like stablecoins, prediction markets and perpetual futures, social applications “disintegrated completely.”

“I was definitively wrong,” Pollak wrote, adding that Base’s focus on social left it behind competitors in key areas including trading, tokenization and payments.

As part of the pivot, Pollak said that the leadership of Base app will return to Coinbase, where popular crypto investor Jordan Fish, also known on X as ‘Cobie,’ will oversee its development. Pollak said Fish will work to make the Base app “the best damn app for onchain,” including expanding beyond the Base ecosystem, while Base itself will prioritize trading, payments and AI agents as it seeks to become infrastructure for global finance.

Researchers at Stanford University and Singapore Management University found that Polymarket’s five-minute Bitcoin prediction markets create incentives for traders to manipulate spot prices around settlement, allowing sophisticated participants to profit at the expense of retail traders.

The study examined contracts in which traders bet on whether Bitcoin’s price would end above or below a predetermined level after five minutes. Because the contracts settle using Chainlink price feeds based on Bitcoin’s price at the end of each trading window, traders have an incentive to influence the spot market immediately before settlement.

Analyzing trading activity before and after Polymarket introduced the contracts in July 2024, the researchers found sharp increases in Bitcoin spot-market order flow just before settlement, followed by rapid price reversals, which were consistent with settlement-price manipulation.

The study estimated that the behavior transferred about $1.28 million from ordinary traders to manipulators during the sample period. The researchers said extending contract durations from five minutes to 15 minutes largely eliminated the effect.

Related: SOL rallies as Solana memecoins, prediction market activity surge: Are bulls back?

The researchers said the results do not indicate prediction markets are inherently vulnerable to manipulation, arguing instead that settlement design can reduce the risk. They pointed to longer settlement windows and alternative pricing methods, such as time-weighted average prices, as potential solutions.

The findings could extend beyond crypto. The paper notes that traditional exchanges, including Nasdaq and Cboe, have proposed event contracts tied to asset prices, making contract design an increasingly important consideration as prediction markets expand into regulated financial markets. 

World Cup fuels prediction market growth

Prediction markets posted record trading volumes in June as the expanded 2026 FIFA World Cup fueled activity across the sector. According to DefiLlama data, Kalshi processed about $9.4 billion in trading volume during the month, while Polymarket International handled roughly $4.3 billion.

The platforms’ World Cup winner markets have since generated more than $5.4 billion in combined trading volume, with Polymarket processing about $4.25 billion and Kalshi about $1.2 billion, according to data from the two platforms at the time of writing.

World Cup winner bets on Polymarket. Source: Polymarket

The sector’s growth has coincided with mounting legal scrutiny. Several US states have challenged companies, including Kalshi and Polymarket, this year, while the Commodity Futures Trading Commission has argued that federally regulated event contracts fall under its “exclusive jurisdiction” rather than state gambling laws.

The dispute is now moving through the federal courts, and legal observers have said conflicting appellate rulings could eventually prompt the US Supreme Court to decide whether states or the CFTC have primary authority over prediction markets.

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Bitcoin (BTC) saw three-week highs on Wednesday as US inflation data beat expectations for a second day.

Key points:

• Bitcoin sees copycat bullish price action as US inflation data cools for a second day running.
• Risk assets get a more positive outlook as Fed rate-cut odds drop.
• Traders stay conservative over Bitcoin’s ability to continue higher.

Bitcoin gains after “much better-than-expected” US PPI

Data from TradingView showed BTC/USD reaching $65,500 for the first time since June 22.

BTC/USD 12-hour chart. Source: Cointelegraph/TradingView

The June print of the Producer Price Index (PPI) came in cool at 5.5% year-on-year after a 0.3% monthly decrease, per data from the Bureau of Labor Statistics (BLS).

“The June decline in the index for final demand can be attributed to prices for final demand goods, which fell 1.4 percent. In contrast, the index for final demand services moved up 0.2 percent,” an official news release stated.

PPI one-month % change. Source: BLS

Reacting, economist Mohamed El-Erian was upbeat on the outlook for risk assets and Federal Reserve policy.

“These much better-than-expected figures are set to boost equities and further temper market expectations for upcoming interest rate hikes,” he wrote in a post on X.

PPI joined Tuesday’s Consumer Price Index (CPI) release, which surprised to the downside despite macro pressure from the US-Iran war and its impact on oil prices.

“Inflation expectations continue to decline,” trading resource The Kobeissi Letter added, referencing bets on a Fed interest-rate hike from users of prediction service Polymarket.

The latest data from CME Group’s FedWatch Tool also showed change afoot in expectations for the Fed’s September decision, with a 0.25% hike no longer the most likely option.

Fed target rate probability comparison for September FOMC meeting (screenshot). Source: CME Group

BTC price momentum battles bear-market history

Assessing current BTC price action, market participants avoided overly bullish takes.

Related: Bitcoin gets new $80K August target: Watch these BTC price levels next

“Liquidity sitting above at the $65.6K mark and most importantly, the $67.2K mark,” trader Daan Crypto Trades wrote on X, referring to exchange order-book liquidity.

“Breaking above the latter would turn this into a bigger move and we can start targeting the $70K+ region again and truly position Bitcoin in the middle of its $60K-$80K range.”

BTC/USDT perpetual contract four-hour chart. Source: Daan Crypto Trades/X

Trader and analyst Rekt Capital noted that BTC was approaching its 50-month exponential moving average (EMA) — a level from which the price should be rejected if bear-market history were to repeat.

“If we follow the same statistical pattern seen over the past 12 months, BTC would likely derisk for the remainder of the month and push back down,” trader Killa added on the topic.

BTC chart. Source: Killa/X

A faulty oracle that caused a $9 million exploit over the weekend was patched on 11 chains in the days leading up to the attack, with the exploited Hedera deployment left vulnerable.

The affected protocol, Bonzo Lend, explained that the oracle accepted an extreme mispricing of the attacker’s collateral asset, which allowed them to borrow funds far in excess of the collateral’s true value.

A further $1 million was extracted by a white-hat hacker.

The vulnerable oracle was created by blockchain infrastructure developer Supra Network, which boasts oracles “live on 67 mainnets.”

Shortly after the exploit, Plasma’s Usmann Khan noted that Supra had upgraded many of its oracles in the days leading up to the exploit, but not the contract on Hedera, which Bonzo Lend used.

Read more: These crypto chains raised $500M but generate just $360 in daily fees

In an incident report published approximately 12 hours after the attack, Supra called the bug a “cryptographic edge case” and doesn’t mention having fixed deployments on other chains.

It simply states, “We have also reviewed every other Supra oracle deployment that shares this verifier pattern to confirm the same guards are in place.”

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Supra’s co-founder and CEO Josh Tobkin blamed “AI-assisted hacking” for discovering “what human eyes had missed” for two years.

Patching the bug

However, following Khan’s post, HSuite founder Tomachi Anura analysed Supra’s on-chain activity.

Everyone reported @SUPRA_Labs patched their @hedera contracts AFTER the $9M Bonzo hack.

The on-chain record shows @SUPRA_Labs shipped that exact fix to 11 chains days before Hedera was drained — and patched Hedera ~6h after.

I’ve been digging deep, and presenting pure facts as… https://t.co/n72jwQZdDl

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— Tomachi Anura (@TomachiAnura) July 14, 2026

Read more: Cap ‘stabledrop’ U-turn sees cUSD drop $23M, founder denies self dealing claims

Anura’s post details the firm’s “cross-chain fix rollout”, with proxy upgrades on 11 chains between June 29 (Base) and July 3 (Polygon), with a further two fixes (on Hedera and Fuse taking place post-exploit).

Anura insists that, while some upgrade addresses vary, “every one whose source is verified resolves to the same 17,354-char guarded SupraSValueFeedVerifier.”

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It remains unclear why the fixes stopped on July 3, leaving the Hedera deployment vulnerable.

Protos has reached out to Supra for clarification, and will update this article should we hear back.

Read more: Oracle error adds to turmoil at DeFi giant Aave

Oracles’ costly misfires

Third-party oracles are used by many DeFi projects’ smart contracts to price assets, or for other external data feeds.

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Oracle manipulation attacks are commonly used, like in this case, to inflate the value of a collateral asset and drain available borrow liquidity on DeFi lending platforms. 

Oracle exploits have led to a further $3.5 million in losses in recent months. In one incident, the critical change to Moonwell’s “vibe-coded” oracle was co-authored by Claude.

While not strictly an exploit, a timestamp mismatch error in Chaos Labs’ Correlated Asset Price Oracle led to a staggering $27 million worth of erroneous wstETH liquidations on Aave’s Ethereum markets in March.

Got a tip? Send us an email securely via Protos Leaks. For more informed news and investigations, follow us on X, Bluesky, and Google News, or subscribe to our YouTube channel.

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Bitcoin has slipped below $65,000 after Iran rejected renewed prospects for peace talks with the United States, adding fresh pressure to risk assets as military operations continue.

Iran’s Foreign Ministry said there are currently no plans for negotiations with the United States, with the country’s immediate priority remaining its defense efforts. The statement came after U.S. President Donald Trump claimed during a FOX interview that Iran had reached out earlier and wanted to make a deal, suggesting diplomatic contact could resume.

The conflicting messages have arrived as the U.S.-Iran conflict intensifies once again. Over recent days, both countries have continued exchanging strikes, while Trump has reinstated the Iranian blockade in the Strait of Hormuz and warned that Washington could expand military operations if Tehran does not return to negotiations.

According to data from crypto.news, Bitcoin (BTC) briefly gave up earlier gains and fell below the $65,000 level, changing hands at around $64,800, down less than 1% on the day. The decline interrupted a rally that had followed softer-than-expected U.S. Producer Price Index (PPI) data earlier in the session.

Fresh military operations keep risk appetite under pressure

While inflation data initially supported cryptocurrencies, renewed military developments shifted investors’ attention back to geopolitical risks.

Earlier in the day, the U.S. Central Command (CENTCOM) announced on X that it had completed a 90-minute wave of strikes targeting coastal defense systems and cruise missile storage and launch sites on Greater Tunb Island. According to CENTCOM, the operation was intended to reduce Iran’s ability to threaten commercial shipping through the Strait of Hormuz.

Hours later, CENTCOM announced another escalation. In a separate post on X, the command said U.S. forces launched a second wave of strikes at 3 p.m. ET, targeting Iranian military capabilities used to threaten vessels transiting the Strait of Hormuz. CENTCOM described the waterway as vital to global commerce and said the operation was carried out under the direction of the U.S. Commander in Chief.

At 3 p.m. ET, U.S. forces launched operations for a second wave of strikes today against Iran. The strikes are targeting Iranian military capabilities used to threaten vessels freely transiting through the Strait of Hormuz, an international waterway vital to global commerce. The…

— U.S. Central Command (@CENTCOM) July 15, 2026

CENTCOM stated that the strikes further reduced Iran’s capability to threaten commercial shipping passing through the Strait of Hormuz, one of the world’s most important energy trade routes. The latest operation follows several days of escalating military exchanges between Washington and Tehran, adding another layer of uncertainty for global financial markets.

crypto.news had earlier reported that cryptocurrencies strengthened after U.S. PPI inflation figures came in below economists’ expectations, reinforcing hopes that inflation pressures may continue easing. However, those gains faded as developments surrounding the U.S.-Iran conflict became the dominant market catalyst.

Prediction markets point to limited optimism for diplomacy

Beyond price action, prediction markets continue to indicate low expectations for a diplomatic breakthrough this month.

Data from crypto-based prediction platform Polymarket shows traders currently assign only a 25% probability that another round of U.S.-Iran peace talks will take place before the end of July. Although prediction markets do not guarantee future outcomes, they offer a real-time view of participant expectations based on active trading.

Attention is also turning toward Iran’s senior leadership for additional guidance on the country’s position. Mohammad Qalibaf, identified as Iran’s top negotiator in the referenced reports, is expected to issue a statement later today addressing the ongoing conflict and recent military developments.

For now, financial markets remain caught between improving U.S. inflation data and rising geopolitical uncertainty. While softer inflation initially supported demand for Bitcoin and other digital assets, Iran’s rejection of negotiations, continued U.S. military strikes, and uncertainty surrounding future diplomatic efforts have kept traders focused on geopolitical headlines as the next major driver of market sentiment.

UK-based financial company Revolut has received approval from the Virtual Assets Regulatory Authority (VARA) of Dubai to offer crypto-related services in the United Arab Emirates (UAE).

In a Wednesday notice, Revolut said that, following a green light from the Central Bank of the UAE for payment activities, VARA gave in-principle approval for the company to offer broker-dealer, management and investment, and exchange services in the UAE. The company said its services via the app and the Revolut X exchange would allow UAE-based users to buy, sell and hold digital assets.

“This approval lays the foundation for Revolut to introduce its trusted virtual asset services within a regulated environment,” said Revolut’s head of digital assets in the UAE free zone establishment, Joseph Khair.

The UAE regulatory approval followed Revolut receiving a UK banking license in March. The company still has similar applications pending for a US banking charter and licensing in Peru as part of its expansion plans.

Related: ECB picks 36 payment providers to test digital euro ahead of 2027 pilot

At the time of publication, VARA listed 51 companies licensed to offer crypto-related services in the UAE, with 22 entities granted in-principle approval. In May, the regulator preliminarily approved cryptocurrency exchange Kraken’s parent company, Payward. The company is expected to fully launch in the region soon.

Revolut to delist USDT next month amid regulatory concerns

Last week, a Revolut spokesperson told Cointelegraph that the company planned to delist the Tether USDt (USDT) stablecoin starting in August for the European Economic Area and Switzerland. The move followed a review of Revolut’s crypto services and risk considerations under the European Union’s Markets in Crypto-Assets (MiCA) framework, which required companies offering digital asset services to be licensed by July 1.

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Cointelegraph is committed to independent, transparent journalism. This news article is produced in accordance with Cointelegraph’s Editorial Policy and aims to provide accurate and timely information. Readers are encouraged to verify information independently.

Acting US Attorney General Todd Blanche faced backlash Wednesday over the Justice Department’s (DoJ) enforcement of crypto-related crimes and other actions as President Donald Trump’s former personal attorney appeared before a Senate hearing considering his nomination to lead the agency.

The ranking Democrat, Senator Dick Durbin, used part of his opening statement at the Senate Judiciary Committee hearing to criticize Trump’s AG pick for what he described as “dismantling DoJ’s enforcement team and shutting down ongoing criminal investigations of the crypto industry.”

Blanche was reportedly behind the disbanding of the Justice Department’s crypto enforcement unit in April 2025 as deputy attorney general.

Todd Blanche speaking at his confirmation hearing before the Senate Judiciary Committee on Wednesday. Source: Associated Press

The Illinois lawmaker said that Blanche’s order dismantling the DoJ’s crypto unit enable Trump to earn $1.4 billion from his ties to the industry, including his family’s business World Liberty Financial.

He also accused former Binance CEO Changpeng “CZ” Zhao of “broker[ing] a deal to channel $2 billion” into World Liberty, which led to a presidential pardon. The former CEO agreed in 2023 to plead guilty to one felony charge related to the Anti-Money Laundering (AML) regime at the exchange.

“Every smarmy, suspect deal in this administration has cryptocurrency behind the curtain,” said Durbin.

Senate Republicans need a simple majority of lawmakers present to confirm Blanche as AG should his nomination advance in the judiciary panel. With Senator Mitch McConnell still hospitalized after what his team described as a fall that led to pneumonia, the party has a slim 52-47 margin to confirm Blanche, who faces pushback over the DoJ’s actions on immigration and its crypto policies, claims that he would facilitate Trump’s attacks on perceived enemies and the handling of the Jeffrey Epstein files.

Related: Three US senators oppose CLARITY Act on ethics grounds with vote expected soon

Blanche also faced crypto-related questions from Republican Senator Thom Tillis who said he was “concerned that the Binance CEO got pardoned.” Blanche said that he would review the pardon process if confirmed.

Blanche signals DoJ shift on pursuing coders

The Trump AG pick was behind a 2025 memo “ending regulation by prosecution” in the crypto industry and previously held at least $159,000 worth of digital asset-related investments before divesting them to his children and grandchildren.

He has been serving as acting US Attorney General since Pamela Bondi’s firing in April, telling crypto holders shortly after his appointment that officials would not pursue cases into blockchain developers who were not responsible for illicit activity on platforms.  

”[I]f you are developing software, if you are a coder, if you are part of that process and you are not the third-party user, and you are not helping and knowing the third party is using what you developed to commit crimes, you are not going to be investigated and not going to be charged,” Blanche said at the Bitcoin 2026 conference.

The department still has ongoing cases against developers behind platforms allegedly used for illegal activities. Federal prosecutors are expected to retry Tornado Cash co-founder Roman Storm later this year after a jury failed to reach a verdict on two charges in 2025.

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