The Weekly Wrap: Large ETF Inflows, Strategy YTD Buying 87.5% of Bitcoin’s Yearly Issuance & DeFi Outflows Amid KelpDAO Hack

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This Week’s Top Stories

“KelpDAO’s rsETH bridge exploited for roughly $290 million.” Saturday, 18 April 2026 

• Over the past weekend, a hacker exploited a vulnerability in KelpDAO's LayerZero-powered rsETH bridge. 
• The attacker tricked the bridge into minting ~116'500 rsETH out of thin air on Ethereum mainnet (worth ~$292 million at the time). This represented roughly 18 percent of the entire rsETH supply. 
• The attacker immediately deposited this unbacked (worthless) rsETH as collateral on Aave and borrowed large amounts of WETH (since the LTV for rsETH was high, close to 1:1). 
• The exploit left Aave with approximately $177–196 million in bad debt (the collateral is effectively worthless and cannot be liquidated profitably). 
• This triggered a massive panic: over $6.6–8.45 billion in withdrawals from Aave in the first 48 hours after the hack. Many pools (especially WETH) hit 100% utilization, meaning suppliers and lenders cannot withdraw their funds right now because all available liquidity has been borrowed out. Users are stuck until borrowers repay or new liquidity enters the protocol. 
• Aave has frozen the rsETH markets on V3 and V4 to contain the damage. The protocol itself was not directly hacked, this stemmed entirely from the KelpDAO bridge exploit. 
• On Monday, the Arbitrum Security Council took emergency action to freeze the 30'766 ETH being held in the address on Arbitrum One that is connected to the exploit. It identified and executed a technical approach to move funds to safety without affecting any other chain state or Arbitrum users. Dragonfly Partner Haseeb explained that Arbitrum used a privileged "Type 101" ArbOS transaction to forcibly claw back the ETH from the hacker. This system-level move completely bypassed the attacker's private key without requiring a chain reorg. 
• In the meantime, the hacker has swapped nearly all of the remaining 75'700 ETH holdings, worth about $175 million, into BTC. The cross-chain swaps were primarily routed through THORChain. 
• Aave's TVL dropped by roughly 45 percent, seeing outflows of $12 billion since the exploit happened last Saturday.

Total Mcap Up 4 Percent This Week with Equities at ATHs 

The total crypto market capitalization is up about 4 percent this week. Despite the major KelpDAO exploit during the weekend, it seems that the overall macro and geopolitical dynamics are of more importance than such crypto-native events. U.S. equities are continuing to trade just shy of new all-time highs, with the S&P 500 trading above 7'100 at the time of writing. 

Gold is trading at $4'677, down 16 percent from its all-time high at the end of January, while Light Crude Oil Futures continue to be elevated, trading at $96. 

Bitcoin is trading at $77'700 at the time of writing, Ethereum is above $2'300, and Solana sits around $85. 

Looking at the weekly performance of the top crypto assets, Pengu is up 13 percent this week amid different announcements from the Pudgy Penguins team and Monero is up 9 percent, likely due to traders anticipating that the hacked funds will be used to buy XMR. 

On the negative side, Aave is down 18 percent this week and LayerZero is also down 18 percent; both are connected to the KelpDAO exploit, with investors losing their trust after such a major incident.

Strategy Bought 87.5% of BTC's Yearly Issuance in the First Four Months 

Michael Saylor's Strategy has been buying Bitcoin like crazy, having bought around 140'000 BTC since the start of the year. The chart below shows that this behavior is something new, as in the past the company had mainly bought BTC during uptrends and not really when prices were down. Strategy alone is absorbing a large portion of the newly issued BTC through mining; the annual issuance of BTC amounts to 160'000 Bitcoin, meaning that Strategy bought 87.5 percent of the yearly issuance alone in the first four months of the year. Strategy is not alone in this game, and this corporate Bitcoin accumulation adds a persistent demand channel absent in prior cycles.

DeFi Outflows Amid KelpDAO Exploit & Polymarket and Kalshi Entering Perps Game

Overall, market participants have decreased their exposure to DeFi as the total value locked in DeFi dropped from $99 billion to $83 billion today; the outflows are not limited to EVM networks but have spread across different blockchains and ecosystems. For example, several USDC markets on Solana's leading lending protocol Kamino have seen sharp surges in deposit APY and utilization rates. Lending markets have been hit the hardest, with the total value locked in lending dropping from $53 billion to $40 billion, a decrease of 24.5 percent. 

Aave's TVL is down 45 percent to $14.2 billion at the time of writing, while total deposits dropped from $48.5 billion to $30 billion this week. Other major lending platforms show varied dynamics, with Morpho's total deposits also falling, but Spark's SparkLend TVL, for example, increased this week. 

Over the last two days, Aave initiated the "DeFi United" effort to restore the rsETH backing, and various major industry players have already contributed Ether to help out, with Lido contributing 2'500 ETH, EtherFi 5'000 ETH, and Ethena or LayerZero contributing undisclosed amounts as well. Stani, Aave founder and CEO, contributed 5'000 ETH out of his own pocket as well. 

There is still a lot to be resolved, and it remains to be seen how this all plays out over the coming weeks. 

On to other topics and on a more positive note, Kalshi and Polymarket announced this week that both platforms will launch perpetual futures trading directly on their platforms. This announcement comes at a time when Hyperliquid is all over the news with the upcoming HIP-4 upgrade that will enable Hyperliquid to start competing in the prediction market space and the options trading market. An interesting dynamic as all three platforms, among others, seem to be fighting to become the home of all finance, the place where users can do everything they desire when it comes to financial markets.

$1.4 Billion Inflows Last Week & Inflows Continue 

Last week, digital asset investment products saw $1.4 billion in net inflows in their third consecutive week of inflows. The $1.4 billion marks the largest weekly inflow since January. Bitcoin, as always, accounted for most of the flows, with $1.1 billion flowing into the products, followed by Ethereum with $328 million. 

As we highlighted above, Strategy also continued its buying spree, adding 34'000 BTC to its balance sheet, spending more than $2.5 billion in a single week, the largest buy since November 2024, just days after the Trump election. Bitmine also bought a lot of Ether, over 100'000 to be exact. Last week marked their largest buy since December 2025 and brings their total holding to almost 5 million Ether.

Crypto Sentiment Increasing & Stocks in Greedy Territory 

The crypto market sentiment continues to increase and reached 46 yesterday. Today it is around 39 but still remains in fear territory, while the US stock market is already approaching extreme greed levels. The American Association of Individual Investors survey has also seen a huge spike in bullish members, with 46 percent now feeling bullish, up from 33 percent at the beginning of April. Such large spikes in bullish members often coincide with short-term market tops, as the historical average of bullish members sits at 37 percent and the 1-year bullish high is 49.5 percent, which was recorded in January this year, just before the correction.

• Tether supports freeze of more than $344 million in USDT in coordination with OFAC and U.S. law enforcement. — Link 
• Russia passes crypto bill in first reading; permits use in foreign trade settlements. — Link  
• STRC has bought 10x more Bitcoin than all ETFs so far in 2026. — Link 
• DoorDash to offer stablecoin payouts with Tempo in push toward everyday crypto payments. — Link 
• New York sues Coinbase, Gemini Titan; calls their prediction markets illegal gambling. — Link

Ceasefire Continues & Crypto Is Up, but How Will It Continue? 

The situation with Iran, Israel, the US, and other involved parties in the conflict continues to be absurdly confusing, and the back and forth between Trump and representatives of Iran continues day by day. One day there are peace talks, then the next there are none; one day the strait is open and then it's closed again. It remains to be seen how this all plays out, but it seems like the market is expecting a positive outcome over the coming days or weeks. US stocks are shy of new all-time highs while crypto is trading upwards, but most assets remain far away from new highs. ETFs and DATs continue to accumulate a lot of Bitcoin and Ether, while major narratives such as perp trading, RWA tokenization, prediction markets, and AI are dominating the space. The recent KelpDAO and Drift exploits put DeFi in a bad light, as the whole industry is starting to question the safety of its assets, particularly in light of Anthropic's Mythos model, which could expose even more DeFi protocols to hackers worldwide. While only specific protocols really took damage in terms of price action, the overall DeFi space saw outflows, but the total crypto market continued to trade higher this week. 

Below, you can find some of the key data releases and events to watch out for next week. 

Tuesday, 28 April 2026 

Japan – BoJ Interest Rate Decision & Monetary Policy Statement 

USA – CB Consumer Confidence 

Wednesday, 29 April 2026 

USA – Fed Interest Rate Decision, FOMC Statement and Press Conference 

Canada – BoC Interest Rate Decision 

Thursday, 30 April 2026 

China – Manufacturing PMI 

Eurozone – CPI, Core CPI, Unemployment Rate, GDP 

Great Britain – BoE Interest Rate Decision 

ECB – Interest Rate Decision 

USA – GDP, PCE Price Index, Core PCE Price Index 

Friday, 1 May 2026 

USA – ISM Manufacturing PMI