Recent security breaches have shaken the crypto industry, showcasing the need for ongoing security enhancements by service providers.

In this edition, Marcin Kaźmierczak from Redstone Oracles analyzes why 2025 is projected to be pivotal for decentralized finance (DeFi) and on-chain finance.

Then, Kevin Tam examines the institutional embrace of Bitcoin through recent 13-F filings and highlights significant holdings in the market.

Why 2025 Will Mark a Shift in DeFi?

The recent hack of ByBit, involving nearly 401,000 ETH valued at approximately $1.5 billion, underscored the importance of security in driving crypto adoption. Despite this, institutions are expected to progress in their on-chain endeavors alongside enhancing security measures.

Rise of Yield-Bearing Assets

Traditionally, yield-generating assets are considered superior long-term investments due to the ongoing cash flow they provide. This trend is now influencing how investors view Ether compared to Bitcoin, as the Ethereum network offers production benefits through its extensive decentralized applications.

Stablecoin Expansion

The demand for U.S. dollar exposure has surged, with stablecoins serving as the most efficient solution. In 2024, venture capital investments flooded into stablecoin initiatives as regulatory frameworks like the EU’s MiCA supported their legitimacy, anticipating even greater adoption in 2025.

Interoperability and Non-Custodial Solutions

To enhance user experience in DeFi, 2025 is expected to see improvements in interoperability that simplify fund transfers across different networks. Innovations like the Account Abstraction movement will work towards making crypto more accessible and streamlined for newcomers.

Conclusion

Amid observed trends, there are noteworthy advancements expected for decentralized finance structures, which will impact institutional engagement and public perception of digital assets significantly.