DeFi Survives Stress Test: No Major Breakdowns, Stablecoins Recover

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DeFi’s stress test ends quietly. Nothing broke.

What to know:

This is an excerpt from CoinDesk newsletter ‘Daybook.’ Sign up here, if you haven’t already.

This is an excerpt from CoinDesk newsletter ‘Daybook.’ Sign up here, if you haven’t already.

Even as Bitcoin gains attention, a significant problem affecting decentralized finance (DeFi) seems to be finally fixed.

Borrowing stablecoins like tether and USDC on the Aave platform now has an annual interest rate of 5% or less. This is a significant drop from last month, when rates were between 13% and 14% after the KelpDAO security incident.

After the security breach, large investors quickly withdrew millions of dollars in various cryptocurrencies, including stablecoins, from Aave. This caused a shortage of funds available for lending. Some traders responded by borrowing stablecoins using their own stablecoin deposits as collateral. Consequently, borrowing costs sharply increased, and this could have potentially caused problems for the broader crypto market.

Following a proposal from Aave’s community and over $160 million in emergency funding provided by those in the Aave ecosystem, conditions began to stabilize.

According to Adam Haeems, head of asset management at Tesseract Group, the recent issues have been resolved and Aave V3 USDC rates are back to around 3.86%. Tesseract, which manages $500 million in assets, also reports that Morpho vaults are earning between 3.5% and 5.4%, and Sky’s USDS savings rate is approximately 3.65%.

He explained that the fluctuations in stablecoin prices – going from a sudden increase to stabilization and then returning to normal – happened completely separately from Bitcoin’s price movements, without influencing each other. He believes this is a key takeaway for institutional investors.

Bitcoin reached over $82,000 today as oil prices fell sharply by 6% and stock market futures rose. This happened because reports suggest the U.S. and Iran are close to a deal that could end the conflict affecting oil shipments through the Strait of Hormuz, which had been causing higher gas prices in the U.S. and Asia.

Some analysts are now closely watching the 200-day SMA at $83,800.

According to Alex Kuptsikevich, Chief Market Analyst at FxPro, Bitcoin is nearing a key technical level – its 200-day moving average. If the price stays above this level, it would suggest a continuing upward trend, similar to what happened a month ago when it broke above the 50-day moving average. As Bitcoin gets closer to $83,000, some investors may start selling to take profits, which could cause a temporary dip in price.

Attendees at the Consensus Miami conference noted that the distinction between crypto derivatives and traditional financial markets is rapidly disappearing. Experts predict that, in the future, crypto exchanges operating outside of major financial centers may see more trading in equity perpetuals (contracts based on stocks) than in standard cryptocurrency contracts.

The dollar index, which usually moves in the opposite direction of Bitcoin’s price, has dropped below 98.00, getting close to its Friday low of 97.72. At the same time, currencies considered indicators of risk appetite, like the Australian dollar, are performing strongly against the U.S. dollar – reaching levels not seen since 2022. This suggests investors are feeling more confident and willing to take risks, so it’s important to be aware of these market signals.

What’s trending

According to U.S. media reports, the White House is working on a document that could lead to an end to conflict with Iran. This comes after President Trump decided to postpone a military operation aimed at reopening the Strait of Hormuz.

Bond prices around the world rose as oil prices dropped, fueled by increasing optimism about a possible agreement between the U.S. and Iran. This decline in oil prices also reduced expectations that central banks would need to raise interest rates, as concerns about inflation lessened.

Gas prices in the US have jumped significantly since the start of the conflict with Iran. Over the past week, the average price of a gallon of regular gasoline increased by 31 cents, reaching $4.48. This represents a 50% increase in price since the war began, impacting drivers’ budgets. (Source: AP)

MicroStrategy is considering selling some of its Bitcoin holdings to cover dividend payments, according to founder Michael Saylor. The company reported a $12.54 billion loss for the first quarter while still holding 818,334 Bitcoin, purchased at an average price of $75,537 per coin. This news caused MicroStrategy’s stock price to fall 4% after trading hours, and Bitcoin’s value dipped below $81,000.

Today’s signal

This chart displays the daily price changes for Zcash (ZEC), a cryptocurrency focused on privacy, using a candlestick chart that starts in August 2025.

The price of Zcash (ZEC) has risen past its previous high of $556.59 from late December. If today’s trading day closes above that level, it would confirm a breakout and could lead to a price increase toward the $700 mark, which was reached in 2025.

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2026-05-06 14:40