Aave Leads Market Recovery

Aave climbed 11% Tuesday as speculation about a potential token-burn mechanism pushed the DeFi token higher. The broader crypto market also recovered, with 72 of the 100 CoinDesk 100 constituents posting gains.

Bitcoin rebounded from Monday’s decline, reaching $84,170, up 0.82% since midnight UTC and 1.4% over the past 24 hours. The CoinDesk 100 index rose 0.89% to 1,904.49.

The gains came despite elevated U.S. Treasury yields. The 10-year yield stood at 5.234% after ending Monday above 5.2%, close to levels last reached in 2007. The 30-year yield was 5.549% after briefly topping 5.56% Monday, around levels last seen in 2004.

Stocks also remained under pressure. The Dow dropped more than 300 points Monday, while the S&P 500 and Nasdaq Composite lost 0.8% and 0.9%, respectively. U.S. stock futures were mixed Tuesday morning.

DeFi Outpaces Major Crypto Assets

DeFi tokens were once again responsible for a large part of the market’s gains, marking the sector’s second strong move in a week.

The DeFi Select Index advanced 5.0% since midnight. Aave gained 11%, while Curve DAO Token rose 5.2%.

The CoinDesk 80 increased 2.0%, compared with a 1.3% gain for the CoinDesk 5. On a 24-hour basis, however, the CoinDesk 5 was ahead, rising 1.7% against the CoinDesk 80’s 0.44%.

Privacy tokens remained under pressure. Zcash declined 4.1% to $1,422.35 and was down 8.4% over 24 hours. Dash fell 6.4% to $61.38, while Zcash traded roughly 13% below its Friday level.

Brent crude fell 0.85% to $97.92, staying below $100 following Monday’s jump. Gold rose 0.68% to $4,140, while the dollar index added 0.18% to 101.36.

Bitcoin Futures Open Interest Hits Lowest Since March

Crypto futures open interest was little changed at $149.36 billion as of 09:45 UTC, compared with $150 billion a day earlier.

Futures volume increased 26% to $218 billion following a 70% jump Monday. Liquidations remained around $389 million, while the long/short volume ratio over 24 hours was roughly balanced.

Bitcoin futures open interest slipped to 644,000 BTC from 650,000 BTC, reaching its lowest level since March 4. Funding rates moved back above zero after turning negative Monday, while the 24-hour OI-adjusted CVD remained neutral.

The data indicates that the bearish positioning among BTC futures traders has lost some of its strength.

Binance Whales Favor Long Positions

Large Binance traders are increasingly positioned for Bitcoin upside.

Whale positions showed a long/short ratio of 1.88, while whale accounts registered 1.31. Retail traders had a ratio of 1.24. Any reading above 1 indicates that long positions outnumber short positions.

Altcoin leverage continued to decline, with ETH and SOL open interest still trending lower. XRP open interest also pulled back to 2.37 billion XRP after reaching a four-week high of 2.46 billion XRP.

LINK Gains as Futures Demand Rises

LINK advanced 14% over 24 hours, ranking among the strongest major-token performers.

Its futures open interest rose 4% to the highest level since Aug. 22, suggesting fresh long positions were being established. LINK also posted positive 24-hour CVD, alongside QNT, ETH and TRX.

Funding remained relatively low at around 2% annualized, pointing to steady demand for long exposure without significant leverage.

Zcash continued to struggle, falling for a third consecutive session. Its futures open interest declined alongside the token’s price, suggesting long positions were being closed.

ZEC also recorded the most negative 24-hour CVD among major tokens, indicating aggressive selling.

Options Markets Lean Toward Calls

Bitcoin and Ether’s 30-day implied volatility remained close to year-to-date lows following Monday’s modest rebound. BTC’s BVIV reached 37.4%.

The subdued volatility readings suggest traders are still expecting relatively calm price action.

Bitcoin’s seven-day and one-month put-call skews turned slightly negative, showing calls trading at a premium again.

The change came after the $84,000 put was the most traded BTC option Monday. Over the latest 24 hours, activity shifted toward calls at $85,000, $90,000 and $95,000.

For Ether, the $3,000 call expiring Oct. 9 became the most actively traded contract, replacing Monday’s top $2,850 call expiring Oct. 20.

Aave, QNT and CRV Continue Higher

Aave traded around $166.55, gaining 11% since midnight and 13% over 24 hours, making it the strongest performer among CoinDesk 20 assets.

The rally followed speculation surrounding “Aavenomics 3.0.” Founder Stani Kulechov said the protocol’s upcoming upgrade could include a token-burn mechanism.

QNT climbed 17% to $269.58 and was up 13% over 24 hours. The move followed a 39% surge Friday and a 16% decline Monday, leaving the token above its pre-rally level.

CRV rose 5.2% since midnight and 22% over 24 hours to about $0.40, recording the largest rolling gain in the index. Most of the move occurred during Monday’s U.S. trading session.

ICP gained 8.3% to $3.39 and was 14% higher over 24 hours. AVAX rose 7% to $11.35 and gained 8.4%.

HBAR fell 3.2% to $0.12 after surrendering part of Monday’s rally, though it remained 9.5% higher over 24 hours. LTC declined 0.51% to $68.86 and held a 2.3% gain over the same period as its halving-related momentum cooled.