GM and happy Friday! 

What a week to be in crypto. Bitcoin ripped 18% higher over the last 48 hours, unleashing a massive short squeeze that wiped out over $1B in positions. Between Trump’s White House crypto comments, the strongest ETF inflows since May and macro maneuvers from the US Treasury, the bulls are back in force. 

Meanwhile, the L2 wars are entering a new phase. Robinhood Chain’s explosive honeymoon launch is facing its first real test as Base rebounds. Let’s dive into what’s moving the markets and who’s winning the fight for L2 dominance.

BTC is up 18% in just 2 days, and in a space where nearly every asset is a high-beta play on the orange coin, that kind of move tends to ripple violently through the rest of the market (but not the TradFi ones).

Perps lead the way, up over 28% on the week. This was largely driven by comments from President Trump at the White House crypto meeting, where he said that the CFTC was working to bring Hyperliquid to the US. As mentioned in yesterday’s issue, there was another reason for the broad-based move: the SEC’s proposed rulemaking for Regulation Crypto Assets. 

There was also a reprieve when the US Treasury said it would at least double the size of its long-term government debt buybacks. A surprise move that came at a time of growing strains in the $32T US Treasury market. The administration may be getting nervous about the long end of the curve and clearly wants to stem the decline. The interest expense on US debt hit $1.4T; that’s more than BTC was worth yesterday. Speaking of, let’s turn our attention back to the market leader. 

BTC ETF inflows recorded the highest daily print since May 2026. At this rate, it will also be the largest weekly print since May. 

Liquidation data points to a short squeeze in the mix. More than $1B of BTC shorts were liquidated across Binance, Bybit, OKX and Deribit from August 19 through the first 6 hours of August 21. Roughly $630M was wiped out on August 19 alone, the largest daily short liquidation event since tracking began on these venues. The concentration of liquidations in such a narrow window suggests forced buying helped accelerate the rally as BTC broke higher.

Market bottoms are not formed when everybody is excited but rather when sellers have been exhausted. Historical data points towards a bottom in Q4 2026, but after three cycles, will traders try to front-run this? For a great read on bottom signals, check out this piece from Blockworks’ Head of Research.

— Marc

The Chain Wars: Robinhood vs Base

Earlier this month, we published a report on Robinhood Chain and its blistering launch. Robinhood Chain had completely upended the L2 market and had become the number one L2 by revenue in just its first month of being live. At $3.6M of chain revenue and 38% of all L2 revenue in July, it was undoubtedly one of the most impressive launches of any chain in recent memory. 

However, underpinning this success was a massive wave of memecoin activity that accounted for over 50% of spot volume. Given how fickle and rotational memecoin activity can be, it is worth checking in on Robinhood Chain to see whether it is building on its successful launch or whether activity is decaying as memecoins rotate back to Solana. 

Based on its month-to-date run rate, Robinhood Chain is still projected to be the number one L2 by revenue in August, with $2.9M. However, one could argue that cracks are starting to emerge. Firstly, revenue is down 19% MoM, potentially a sign that July’s revenue numbers were in fact due to Robinhood Chain being the “new blockchain.” Second, this August projection is based on revenue through August 21. However, the last seven days show a different picture. Base generated $701,400 in revenue, surpassing Robinhood Chain’s $449,000. Perhaps the calls for the fall of Base were a bit too premature.

Anyways, one must tread with caution when examining a small data set of just three weeks, but a clearer picture of the L2 landscape is starting to emerge. Yes, Robinhood Chain is certainly here to stay, but it will have to fight tooth and nail with Base over the top spot. Its success is not pre-ordained, and Robinhood will need to have an ecosystem strategy more expansive than just its current slate of day-one launch partners and the sporadic marketing tweet from the Robinhood X account. This is especially true given that Base will directly be challenging Robinhood’s claim as the chain for tokenized equities as Coinbase looks to launch its tokenized equities on Base, making the offering of tokenized equities alone unlikely to be a strong enough moat for either L2.

The more likely deciding factor between Robinhood Chain and Base is which chain can cultivate an ecosystem of protocols that actually put tokenized equities to work, integrating them into the lending markets, DEXs, and other primitives crypto has already built, and which one can make that ecosystem feel cohesive rather than a loose collection of unrelated deployments.

Cultivating an ecosystem of builders takes sustained effort from Robinhood, and it cannot be approached from the developer side alone. Those builders need users who are willing to try unproven protocols and put real money into them, which means Robinhood has to court the user side just as deliberately as it courts the teams. This is all especially pressing right now as crypto is beginning to turn and price action is improving, which is precisely when new users, new capital, and new teams are easiest to attract.

Despite being surpassed by Robinhood Chain over these past two months, Base still has a few advantages working in its favor. Not only does Base have a head start of a few years as it has amassed an ecosystem of applications that regularly earn 7 to 8 figures of revenue each month, but it also has an ace up its sleeve with a potential for a BASE token. Nothing can attract users, capital, and protocols quite like an airdrop and some token incentives. 

Nothing takes away from what has been a remarkable launch, and Robinhood Chain has clearly earned its place at the top of the L2 landscape, but earning that place and holding it are two very different things. Robinhood has every advantage it needs to build the leading onchain ecosystem, though it will have to fight for it rather than assume its launch momentum carries it the rest of the way.

— AJC

Onshoring Hyperliquid: The Compliant Path to US Markets

The article argues that Hyperliquid’s path into the US will not come from opening its permissionless frontend to American users, but by allowing regulated firms to build compliant access on top of HyperCore. The Hyperliquid Policy Center has pushed regulators to treat HyperCore as neutral infrastructure, with brokers handling KYC and deployers taking on exchange-like responsibilities for listings, surveillance and emergency controls. Permissioned HIP-3 deployments and new account-control tools now provide the infrastructure for that model. The report expects these regulated instances to give US investors access to Hyperliquid’s markets without changing its permissionless core, although separate order books would initially fragment liquidity. 

Tokenized Stocks in America

Vlad Tenev argues America is being left out of a global tokenization supercycle that American firms are largely driving. Robinhood Chain is already the fastest EVM chain to 100M transactions, with Stock Tokens giving users in over 120 countries exposure to 190+ US stocks, though not yet in the US.

His case rests on real-time settlement, native 24/7 trading against Robinhood's 24/5 US offering, and instant portability that forces brokers to compete rather than lock users in. Tenev wants policymakers to modernize securities rules quickly, framing public equities as only the foundation for eventually tokenizing private markets.