While the market consolidated near key levels, several landmark events occurred in the industry. Japanese authorities announced the creation of state-backed blockchain infrastructure, exchange Kraken faced a "dust attack," and market maker Wintermute sharply reduced short positions on Hyperliquid. I break down the key events and price dynamics.
Market Overview: Correction and Liquidations
Bitcoin (BTC) traded near $79,088 by 09:00 Moscow time, down 2.04% over the day. The daily range was $77,850–$80,800, and by morning the asset had settled around $79,000. Ether (ETH) fell 1.79% to $2,465, with quotes dipping to $2,415 overnight, while the high reached $2,510.
Correction dominated among the top 25 by market cap. The biggest declines were Stellar (XLM) — down 7.62%, Cardano (ADA) — down 7.15%, and Zcash (ZEC) — down 7.05%. Dogecoin (DOGE) lost 6.38%. The only notable exception was Hyperliquid (HYPE), which gained 2.23%. Among the top 100, the best result was shown by the LayerZero (ZRO) token with a 9.94% increase, while Monad (MON) plunged 10.7%, becoming the day's laggard.
Spot Bitcoin ETFs attracted $314.37 million, Ethereum funds — $179.8 million, Solana — $32.25 million, XRP — $23.87 million, Hyperliquid — $7.51 million, Chainlink — $1.02 million, and Hedera — $863,980. At the same time, positions of 84,238 traders were liquidated over the day for a total of $371.3 million. The main impact fell on longs — $309.78 million versus $61.52 million in shorts. The largest liquidation order was recorded on Binance for the BTCUSDT pair at $11.91 million.
Japan Launches Blockchain for Finance
The Japanese government, the Bank of Japan, and relevant financial organizations announced the development of next-generation blockchain infrastructure for settlements of government bonds, stocks, and other assets. The system is expected to provide round-the-clock real-time settlements. This summer, a special working group will begin operations involving the Financial Services Agency, the Ministry of Finance, the central bank, and industry experts. A plan for the architecture and interaction regulations is expected to be formed by early 2027. Blockchain experiments in the financial sector had previously been conducted in the country, but specific implementation timelines have been outlined for the first time.
Kraken and the "Dust Attack"
Exchange Kraken temporarily restricted access for some clients after a series of small crypto transfers from a wallet that Arkham Intelligence analysts link to HTX. Platform representatives classified the incident as a "dust attack," suggesting its goal may have been to distribute sanctioned funds or trigger checks on other platforms. From August 17 to 24, nearly 12,000 micro-transfers ranging from a few cents to a couple of dollars were sent from this wallet to addresses associated with Kraken. Access to the affected accounts has been restored, but the sanctioned funds continue to be held. HTX denied involvement in the transfers and stated it is reviewing versions about erroneous address linking and actions by malicious actors.
Wintermute Restructures Positions
Market maker Wintermute reduced short positions on Hyperliquid from $211.53 million to $80.48 million, i.e., by $131 million. At the same time, the company's long positions on the platform amount to only $5.51 million. The short position in HYPE grew from $5.60 million to $10.20 million, and the unrealized loss on the portfolio is estimated at $568,800.
My view: Wintermute's decision to reduce its short amid HYPE's growth looks like a forced risk-management measure rather than a change in market outlook. Combined with the news about Japan's blockchain initiative, this points to growing institutional interest in infrastructure projects, which could support the market in the medium term.