En route to the Slyph and Cait Sith meeting, Kirito learns from Yui that a group of sixty-eight players, likely Salamanders, were approaching a group of fourteen players, Slyphs and Cait Siths. With little time to spare, Leafa suggests Kirito simply head for the World Tree. Kirito, however, refuses to run away, and hurries towards the meet.
As the Salamanders prepare to attack, Kirito arrives and demands an audience with the Salamanders' commander, explaining that he represented a (non-existent) Spriggan and Undine alliance come to negotiate trade between the Sylphs and Cait Siths. The commander appears and calls out Kirito for a liar, and challenges him to withstand his attacks for thirty seconds if he hoped to prove himself truthful. Sakuya recognizes the leader's weapon, the Demonic Sword Gram, which belonged to one of the strongest players in ALO, the Salamander commander Eugene.
Eugene attacks Kirito, demonstrating his sword's special ability, "Ethereal Shift", which allows him to phase his sword through his opponents' weapons, rendering any attempt at defense useless. With Eugene deciding to kill Kirito instead, Kirito uses a smokescreen to distract him while he commandeers Leafa's sword and fights back with two swords. Kirito quickly gains the upper-hand, overwhelming Eugene with an incredibly fast and aggressive assault and laying him low.
Sakuya revives Eugene after the duel, and Eugene pays his respects to Kirito, seeing him as the stronger fighter. When he asks about the veracity of Kirito's claims of a Spriggan and Undine alliance, Kagemune, his subordinate and the leader of the party that attacked Kirito and Leafa when Kirito first logged into ALO, speaks up for Kirito, much to his surprise. Believing that he wouldn't stand a chance against an assault from four allied races, Eugene agrees to withdraw his forces.
Afterwards, Leafa tells Sakuya of Sigurd's treachery. Sakuya speculates that Sigurd planned to take advantage of the rumored upcoming "reincarnation" system to remake his character as a Salamander, which the Salamanders' leader would grant if he had Sakuya assassinated. With Alicia casting a "Moonlight Mirror" communication spell, Sakuya reveals to Sigurd that his scheme had failed, but she decided to grant Sigurd's wish to turn his back on the Sylphs by having him banished from Sylph territory, forcing him to become a loathed renegade.
With Sigurd's scheme destroyed, Kirito reveals that there was no Spriggan and Undine alliance: he made it up on the spot, and was a freelancing mercenary. Sakuya and Alicia immediately try to coax Kirito to join up with them, flirting aggressively with him, much to Leafa and Yui's chagrin. Kirito turns down both leaders, but leaves a veritable war chest of Mithril Yrd coins to fund their own assaults on the World Tree, before he and Leafa set off for the city of Alne.
Meanwhile, Asuna uses the code she memorized from earlier to escape from her cage.
