Morning Minute is a daily newsletter authored by Tyler Warner. The views and analysis presented are his own and may not represent those of Decrypt. Additionally, check out our new daily news show where we cover all top stories in just 5 minutes, available on Apple Pod or Spotify.
Good Morning!
Here are today’s major updates:
- Leading cryptocurrencies mostly declined, dropping 1-5%, with SOL showing gains; BTC is at $59.5k
- Strategy’s STRC decreased to $73, reaching a new low; MSTR is priced at $84
- Tether’s USDT has overtaken ETH in fully diluted valuation, now the second-largest token
- Kraken is negotiating to acquire a 15% stake in Aave, valuing it at $385 million
- Story Protocol has rebranded itself as a data network, shifting focus towards AI training
🏦 Kraken Pursuing 15% Stake in Aave at a $385 Million Valuation
Kraken is currently in discussions to purchase a 15% stake in Aave for a valuation of $385 million.
To facilitate this, Kraken plans to invest 35,000 ETH (approximately $55 million) in exchange for 250,000 AAVE tokens (valued at $20 million) along with a 15% equity stake in Aave Group, the entity behind the protocol, totaling around $71 million.
This initiative follows Aave’s recovery from the KelpDAO exploit in April, which led to significant deposit withdrawals, although Aave's smart contracts remained intact. For Kraken's parent company, Payward, this marks an effort to diversify ahead of a potential initial public offering (IPO).
The announcement coincides with Standard Chartered expressing a bullish outlook on the AAVE token. Geoff Kendrick has begun coverage of AAVE, projecting a price target that suggests a nearly 50-fold increase by the end of the decade, estimating a price around $4,000 compared to its current value of about $81, based on the bank’s belief that tokenization and on-chain credit can drive substantial growth in DeFi lending. Thus, within a single week, a major bank is betting on the token while a prominent exchange is investing in the company.
However, this presents a challenge for token holders or potential buyers. Kraken’s deal assigns a $385 million valuation to the Aave company, yet the AAVE token is trading at a mere $1.24 billion market cap, which is over three times the equity valuation. In conventional finance, the company's value is paramount, as it encompasses the business and its cash flows. However, the crypto landscape often defies this norm, complicating the understanding of token versus company value—a central theme of this market cycle.
In the case of Aave, the protocol's economic benefits largely accrue to the token through the DAO treasury and a buyback program funded by protocol revenue, while the company primarily develops and manages the software. Consequently, the market appears to suggest that the token embodies most of Aave’s worth, or that the token is simply valued higher than the underlying business. Kraken has opted for a balanced approach, acquiring both tokens and equity in this transaction. Yet, for those observing from the outside, it becomes tricky to invest in a token trading at over three times the value of the company it represents.
It remains to be seen if the market will adjust or if it is content with this valuation disparity…
🤖 BlackBerry Rises 20% as It Transforms into a Physical-AI Software Provider
BlackBerry shares surged nearly 20% on Thursday following an earnings beat and upgraded forecast, as the former mobile phone manufacturer embraces its role in the development of physical-AI and robotics. The company reported first-quarter revenue of $152.9 million, marking a 26% increase year-over-year, significantly surpassing the anticipated $138 million, with adjusted EBITDA rising by 144%, achieving its first positive cash flow in the fiscal first quarter in nine years.
The growth is attributed to QNX, BlackBerry’s embedded operating system, which experienced a 26% increase to $72.3 million. QNX is a safety-certified real-time operating system utilized in over 275 million vehicles. Its reliability in automotive applications also makes it valuable for robots and autonomous machines, where software failures can have serious consequences. Companies like Nvidia and AMD are already integrating it into smart vehicles and robotics, positioning BlackBerry as a key infrastructure provider for software-defined vehicles, robotics, and industrial automation.
Thus, BlackBerry is now presenting itself as a foundational player in the physical AI sector. As robots and autonomous systems require a fail-safe operating system, BlackBerry’s QNX fulfills this need. A survey commissioned by QNX indicated that 89% of robotics developers view physical AI as essential to their strategies, and the recent stock surge suggests that Wall Street is beginning to recognize BlackBerry as a significant contributor in the AI and robotics markets.
🌎 Macro Crypto and Markets
- Most major cryptocurrencies are experiencing declines of 1-5%; BTC down 3% at $59.5k; ETH down 5% at $1,550; SOL up 1% at $68.85; HYPE down 1% at $62
- Top movers include BEAT (+28%), LAB (+14%), and AAVE (+7%)
- Oil remains steady at $69.60; Gold increased by 0.5% to $4,070
- Stock futures are in the red as the tech selloff continues; DOW down 0.1%, Nasdaq down 1.1%
- Strategy’s STRC reached a new low as Bitcoin faced another downturn, with preferred stock declining further as BTC approached 2026 lows, adding pressure to Saylor’s funding model
- Tether overtook ETH in fully diluted market capitalization, now the second-largest cryptocurrency following the recent decline of ETH
- OpenAI executives are allegedly urging Sam Altman to postpone the IPO until 2027 due to the market’s response to SpaceX
- Coinbase’s Base network resolved a block-production issue that temporarily halted operations before resuming normal functionality
- SBI Holdings finalized a $289 million acquisition of Bitbank, establishing Japan’s largest regulated cryptocurrency exchange
- CoinEx rejected claims of involvement in an alleged $38 billion Iranian sanctions evasion scheme, countering accusations linking the exchange to the operation.
Corporate Treasuries & ETFs
- Bitcoin ETFs experienced $692 million in net outflows on Thursday, marking the second-largest outflow since January; ETH ETFs saw $82 million in outflows
- The HYPE ETFs recorded $4.6 million in outflows on Thursday
- Bitmine is set to join the Russell 1000 Index on June 26, which should provide a new source of investment inflows
Meme Coin Tracker
- Meme leaders mostly declined; DOGE down 3%, SHIB down 5%, PEPE down 6%, PENGU down 2%, TRUMP unchanged, BONK down 4%
- World (+50%), Jotchua (+40%) and SPCX69 (+58%) were the top gainers on Solana
- Movers on Base included POD (+24%) and ICNT (+34%)
📈 Myriad Market of the Day
💰 Token, Airdrop & Protocol Tracker
- Story Protocol has rebranded to a data network focused on AI training data following a 98% collapse of its IP token, betting that providing data for AI models presents a more significant opportunity than its previous intellectual-property focus
- Spark and Uniswap are collaborating to create an FX layer for stablecoins, aiming to establish forex-like infrastructure for swapping fiat-backed tokens
- A recent Polymarket exploit resulted in the theft of $3 million in user assets after a breach of a third-party data provider; Polymarket plans to reimburse affected users
🚚 NFT Market Updates
- Major NFT collections remained mostly stable; Punks steady at 32 ETH, BAYC down 1% at 8.75 ETH, Pudgy up 1% at 4.55 ETH; Hypurr increased by 3% to 202 HYPE
- Top gainers included Funkari (+17%) and Captainz (+14%)