Data & Insights: Ethereum Reseize USDT Dominance; Kalshi Flips Polymarket

ASTERnomical Rise

• Aster, a decentralized perpetuals exchange, has been gaining mass attention and traction in recent days following its token launch on September 17, 2025.
  • Aster was formerly known as APX Finance, before a rebrand following a merger with Astherus in March 2025, which we covered in our newsletter in the final week of June edition.
  • Aster is backed by YZi Labs (formerly Binance Labs) and its launch rollout emphasized multi-chain support with an early push on BNB Chain.
  • Beyond the typical high leverage and multi-chain features commonly seen in other perp DEXs, Aster’s main differentiator is its “hidden orders” feature that lets users place fully “invisible” limit orders on the orderbook, unlike the transparent fully visible nature of most on-chain perp DEXs.
• The ASTER token immediately caught headlines following its launch, as price discovery and trading volumes were volatile to the upside and social attention snowballed after a high-profile public endorsement on X from Changpeng Zhao (CZ), co-founder of Binance.
  • ASTER is currently valued at over $12 billion following its initial fully diluted valuation (FDV) of $560 million at TGE. 
  • The price of ASTER increased by over 10x from the time of CZ’s public endorsement to its $2 peak in the span of just 4 days.
  • The allure of a newly launched token, in addition to a “Binance-adjacent perps dex” narrative via backers and chain choice, turned what was a normal TGE into a momentum event.
• The Aster perp dex itself (formerly APX Finance) has averaged over $9 billion worth of monthly trading volume over the past 3 months.
  • Though September’s data is incomplete, as the month has not ended at the time of writing.
  • However, with the recent mass attention that likely triggered significant flows and trading volume into the platform, September’s volume figures will most likely be significantly higher than previous months.
  • With Aster hitting a home run in terms of initial launch distribution and attention, the most important factors to watch next would be whether trading volumes and liquidity persist after this initial hype window.
  • With the significant backing and resources at its disposal, it is up to Aster to prove whether it can be a real sustainable competitor in the perps DEX sector, notably against Hyperliquid.

Nail The Lending

• Total value locked (TVL) in Solana’s lending sector reached a record high $4.53 billion last week.
  • Kamino leads with over 71% of the share, followed by Jupiter Lend with roughly 17%.
• The main driver behind the rise in Solana lending TVL over the past month has been Jupiter Lend.
  • Jupiter Lend’s public beta at the end of August 2025 unlocked fresh deposits as it garnered ~$450 million within just five days, adding a second large venue for lenders and loopers.
  • Kamino momentum also remained relatively strong in this period as new incentives and additional isolated markets drew deposits from SOL LST holders looking to leverage staking yield.
  • The strong performance of SOL itself in September also contributed, as it rallied by over 25% during the first 3 weeks of the month.
  • On a side note, the KMNO and JUP tokens are up by over 50% and 14% in September at the time of writing, indicating a risk-on appetite for Solana DeFi projects over the past several weeks.
• A larger, more competitive lending stack is a tailwind for Solana DeFi as it lowers capital frictions for basis trades and LST loops, which in turn supports DEX volumes and staking activity.
  • This also helps Solana’s case in being a strong DeFi venue, as past narratives might have otherwise shunned Solana for being a blockchain primarily for “memecoins” and “meme token launches”.
  • If this lending stack keeps deepening and staking-linked loops mature, Solana has a clear path to shed the “memecoin chain” label and stand out as a throughput-driven DeFi powerhouse.

ETH ETF Volume Drain

• Spot Ethereum ETF volumes have reached 15% of total ETH spot market volume, marking a significant increase from the 3% share observed at launch in November 2024.
  • This steady climb reflects growing institutional and retail preference for regulated exposure to Ethereum rather than direct token ownership, eliminating custody and security concerns associated with self-managed wallets.
  • The ETF structure enables traditional investors to gain Ethereum exposure through familiar brokerage accounts, significantly expanding the addressable market beyond crypto-native participants.
• The shift toward ETF-based exposure presents both opportunities and trade-offs for the Ethereum ecosystem.
  • ETFs have contributed to Ethereum's strong price performance, with ETH rising over 30% year-to-date to approximately $4,500, as institutional capital flows through regulated investment vehicles.
  • However, this growth comes at the cost of decentralization, as large amounts of ETH become concentrated in ETF provider custody rather than distributed across individual wallets participating in DeFi protocols.
• The increasing ETF dominance highlights a fundamental tension between mainstream adoption and ecosystem utilization.
  • While ETFs democratize access to Ethereum investment, the underlying ETH held by providers typically remains idle rather than being staked or used in decentralized applications.
  • However, this may be set to change in the coming months as ETH providers look to get permission to stake their ETH, generating yield. 
• The trajectory suggests ETFs may become an increasingly dominant force in Ethereum trading volumes.
  • As traditional financial infrastructure continues to integrate crypto assets, the proportion of ETH trading conducted through regulated products rather than spot markets may continue to expand.
  • This evolution could reshape the development of Ethereum's market structure, striking a balance between mainstream financial adoption and the network's decentralized principles and utility-driven value proposition.

The ReFlippening

• Ethereum has reclaimed its position as the primary network for USDT supply, reaching $80 billion and surpassing Tron after falling behind earlier in March 2025.
  • This reversal represents a significant shift in stablecoin infrastructure preferences, with both networks maintaining relatively stable supply levels around $75-80 billion throughout most of 2025.
  • The close competition between these networks highlights the ongoing shifts in settlement dominance, with marginal advantages potentially driving substantial liquidity migrations.
• The redistribution of USDT supply reflects evolving user preferences for blockchain infrastructure, particularly as traditional finance increasingly adopts stablecoin rails.
  • Ethereum's resurgence suggests that users are prioritizing the network's established DeFi ecosystem and institutional-grade infrastructure over Tron's lower transaction costs.
  • Daily stablecoin transfer transactions on Ethereum have reached nearly 1 million transactions per day, indicating not just static holdings but active utilization of USDT for payments and settlements.
• This shift occurs as traditional financial institutions increasingly integrate stablecoins into their payment infrastructure.
  • Companies like PayPal with PYUSD and other traditional finance players are incorporating stablecoins into their existing rails, favoring Ethereum's more established institutional presence.
  • The growing institutional adoption of stablecoins suggests that network effects and regulatory clarity will continue to be the main drivers of innovation and adoption. 
• The competitive dynamics between blockchains for stablecoin dominance carry broader implications for blockchain ecosystem development.
  • The presence of large stablecoin volumes, such as USDT, influences cross-chain bridge activity, exchange integration strategies, and overall DeFi liquidity concentration.
  • Ethereum's advantage in capturing institutional stablecoin flows could reinforce its position as the primary settlement layer for sophisticated financial applications, particularly as traditional finance continues to explore blockchain-based payment solutions.

Flip-Flop Predictions

• Kalshi has overtaken Polymarket as the leading prediction market platform in September 2025, generating $1.64 billion in volume compared to Polymarket's $900 million, representing a significant shift in market dynamics.
  • This marks Kalshi's strongest monthly performance to date, while Polymarket maintains a volume of around $1 billion a month throughout 2025.
  • The platform now operates approximately 16,000 daily active markets, indicating substantial breadth in prediction offerings beyond traditional political and sports betting.
• Strategic partnerships with retail brokers launched in late August appear to be the primary catalyst for this volume surge.
  • Integrations with Robinhood and Webull have enabled prediction market access directly through established trading platforms, tapping into existing user bases familiar with these interfaces.
  • This distribution strategy has effectively bridged traditional finance users into prediction markets without requiring them to navigate specialized crypto platforms or wallets.
• Regulatory positioning continues to provide Kalshi with competitive advantages in the US market.
  • CFTC regulation allows Kalshi to operate with legal clarity that crypto-native platforms currently lack, though this requires traditional KYC procedures and USD deposits rather than permissionless access.
• Market dynamics may shift as Polymarket prepares its anticipated return to US markets.
  • While Kalshi benefits from a first-mover advantage in regulated US prediction markets, Polymarket's established global user base and crypto-native infrastructure could present renewed competition.
  • The outcome will likely depend on whether mainstream users prioritize regulatory compliance and familiar interfaces over decentralized accessibility and global participation.