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It’s been over a month since @fate_computer‘s announcement.

And they’ve already launched a new basket: 30+ prediction markets, one thesis — ‘never bet against Elon’.

Weekly Summary

We cover:

• three areas of crypto showing strong underlying growth

• market update

Three Crypto Growth Trends

Crypto markets remain selective, but beneath the headline price action there are areas where adoption and economic activity are accelerating. This week, we highlight three charts showing growth across very different parts of the market: tokenised equities, onchain credit and consumer trading.

1. Tokenised stocks are finding users

Tokenised equities have moved beyond simply growing assets onchain — the number of users interacting with them is now accelerating.

The number of tokenised stock holders has risen to 1.33 million, up 93% over the past 30 days, while monthly active addresses have increased 42% to more than 600,000. Monthly transfer volume has also jumped 195% to $23.5 billion.

This is occurring alongside continued growth in assets, with distributed tokenised stock value reaching $2.33 billion.

The important shift is that user and transaction growth is now substantially outpacing asset growth, suggesting the market is becoming more actively used rather than simply accumulating tokenised AUM. Recent growth has been spread across products including xStocks, Ondo and tokenised exposure to names such as SpaceX.

2. Demand to borrow USDe is rising

USDe borrowing on Aave has increased sharply over the past month. Active USDe loans on Ethereum have risen 35.7% to $544 million, taking utilisation to 73%, while deposits sit at $741 million. Borrow APY has consequently risen to 3.32%, with supply APY at 1.81%.

The growth appears primarily linked to USDe’s role as a funding asset within leveraged DeFi strategies rather than conventional borrowing demand.

Aave explicitly supports borrowing USDe against Ethena-related collateral such as sUSDe and Pendle PT-sUSDe, allowing users to recursively increase exposure to Ethena yields.

In simple terms, USDe is increasingly being used as onchain leverage infrastructure: yield-bearing assets are posted as collateral, USDe is borrowed against them and the capital can be recycled into additional yield exposure. The result is greater capital efficiency, but also greater leverage embedded within the system.

3. Pump.fun revenues are reaccelerating

Pump.fun is another area where underlying economics have improved materially. Daily revenue has risen from roughly $600k–$1.0m through much of June and early July to around $1.4m–$1.7m recently, driven by growth across Pump.fun, PumpSwap and its Terminal trading product.

The driver is a recovery in trading activity combined with Pump.fun’s expansion beyond its original token launchpad.

PumpSwap allows it to monetise tokens after they graduate from the bonding curve, while Terminal extends monetisation into more general trading activity.

That broader funnel is beginning to show up in the numbers. Ecosystem trading volume recently reached $2.97 billion over a week, its highest level since January, while weekly protocol fees exceeded $10 million.

The significance is that Pump.fun is increasingly monetising the full lifecycle of speculative trading activity, rather than relying solely on new token launches.

Market Update

Crypto markets declined moderately last week (-2.27%) as the consolidation within the broader wedge pattern continued.

BTC has faced resistance at the $65k level.

The CLARITY Act failed to reach a Senate vote before the August recess, pushing the next key procedural vote to 15 September.

The bill still requires 60 votes to advance, with disagreements around stablecoin rewards, ethics provisions and banking protections leaving passage increasingly uncertain ahead of the November midterms.

At the same time, long-term DeMark signals and RSI divergences have meant that technical damage has remained relatively limited.

With the broader risk-on market continuing outside of crypto, it increasingly feels that crypto will be joining the party fashionably late.

Altcoin market cap continues to consolidate (like beta) but is getting to a make-or-break outcome.

Looking ahead, gold has broken out after a prolonged period of seller exhaustion, providing a potentially constructive signal for liquidity-sensitive assets.

Given gold has historically led global liquidity by roughly a year, the breakout suggests the liquidity expansion could continue into 2027, potentially extending the broader bull market.

State of Yields

Stablecoin lending yields:

• ~3.36% on Aave (USDC) — no change from last week.

• ~2.11% on Aave (USDe) — marginally lower than last week.

• ~4.82% on Maple (syrupUSDC) — 2 bps higher than last week.

Fixed-rate DeFi lending: yield premium in fixed markets:

• Pendle sUSDAi: ~10.1% (Oct 2026 – Feb 2027 maturities).

• sUSDe: ~4.15% — 15 bps lower than last week.

ETH yield benchmarks:

• Lido staking: ~2.14%.

About Re7

Re7 Capital is a research-driven digital asset investment firm specialising in DeFi yield and liquid alpha strategies.

Disclaimers

The content is for informational purposes only. None of the content is meant to be investment advice. Use your own discretion and independent decision regarding investments. The opinions expressed in all Re7 public research articles are the independent opinions of the authors at the time of publication and not the opinions of the affiliates of Re7.

Please see here for full disclaimers.

Stay informed about what matters in crypto. Forget the noise. Get free market-leading crypto research by subscribing to Re7 Capital’s research below:

Subscribe now

Last month, Re7 Capital turned 5 years old! 🎉

Re7 went live in the days of DeFi summer, with a dream of growing into a leading financial player of the digital assets economy and a thesis that liquidity provisioning would propel it into the heart of its industry. Five years and over $1.5 billion deployed across DeFi protocols later, that thesis has held.

Today, Re7 stands as an institutional-grade DeFi liquidity provider, an investor across both liquid and private markets, and one of the leading DeFi vault curators globally.

Weekly Summary

We cover:

• Why DeFi yield is making a comeback

• Three markets signalling stronger leverage demand

Stablecoin Growth Is Pausing, Not Peaking

Stablecoin Growth Hit a Macro Ceiling

Stablecoin supply has historically been highly sensitive to the relative attractiveness of on-chain yields versus the risk-free rate.

Last cycle, stablecoin growth peaked as inflation broke convincingly above the Fed’s 2% target and Treasury yields began their sharp repricing higher.

As the US 10Y moved from <2% to ~5%, capital had an increasingly attractive alternative to taking risk on-chain. DeFi yields compressed, liquidity left the system, and stablecoin supply contracted.

That relationship began to reverse almost exactly when the US 10Y peaked around 5% in October 2023.

Markets increasingly understood that there was a limit to how much tightening the economy and financial system could absorb.

Treasury yields and term premia fell, the opportunity cost of holding capital on-chain declined, and stablecoin supply began another sustained expansion.

Importantly, stablecoin supply never returned to its previous trough, suggesting each cycle is building from a structurally higher base.

We may now be seeing the same mechanism temporarily working in reverse.

The recent geopolitical shock around Iran has increased inflation and term-premia concerns, pushing the 10Y back towards 5% and raising the hurdle rate for capital to remain on-chain. Stablecoin growth has consequently stalled.

How High Can Yields Really Go?

But there is likely a ceiling to this dynamic. The US cannot indefinitely tolerate materially higher long-end yields given the scale of government refinancing and the tightening they transmit through the economy.

At some point, either inflation fears moderate, growth weakens, or policy/liquidity conditions respond. Yields and term premia then compress, lowering the hurdle rate for capital to move back out along the risk curve.

There are already signs policymakers are sensitive to this upper bound. US 10Y yields and USD/JPY have tracked closely, while the Treasury’s unusual decision to sell euros to support the yen suggests concern around excessive rate differentials.

A wider US–Japan rate differential tends to weaken the yen, increasing the risk of Japanese Treasury selling — creating a natural constraint on how far the long end can rise before policy responds.

This makes the current stablecoin slowdown look more cyclical than structural. If Treasury yields are approaching the upper end of what the system can sustainably absorb, the next repricing could produce another acceleration in stablecoin growth.

That said, stablecoin and tokenised-money adoption hasn’t paused. From Stripe, Wells Fargo, Circle, BNY Mellon, Visa, and Mastercard all pushing stablecoin innovation in the last two months alone.

On-Chain Growth Hasn’t Stopped - It’s Shifted

Yet, on-chain growth has not disappeared while stablecoins have stalled; its expression has simply changed.

Tokenised Treasuries and other RWAs directly benefit from higher rates and have continued expanding as stablecoin growth has moderated.

Capital can now remain on-chain while moving between cash-like stablecoins, tokenised risk-free yield and higher-yielding DeFi opportunities.

The Next Liquidity Expansion

Tokenisation is creating a broader and more persistent on-chain capital base, smoothing what was previously a much more binary liquidity cycle.

As the macro hurdle rate falls again, the result should be not just more on-chain liquidity, but a broader and richer DeFi yield environment.

The most significant phase of stablecoin and tokenised asset growth may therefore still be ahead.

Market Update

Crypto markets were marginally up last week (+1.4%) and are looking to resume the trend to test resistance.

This follows the bullish weekly and monthly signals across beta, L1 relative ratios and alt indices that we highlighted last month.

BTC will need to close above $65k to open a move towards the next major resistance at $70k.

Bitcoin’s price stability has been supported by >$850m of net inflows last week — the strongest since mid-April.

The path of least resistance for crypto/NASDAQ remains to the upside after longer-term DeMark buy signals were printed.

The positive opening to the week for crypto is translating to relative strength between the two once again.

In fact, the alt market is leading the charge (pink) versus other major sector indices since Sunday’s futures open, providing an early indication of investor appetite this week.

State of Yields

Stablecoin lending yields:

• ~3.37% on Aave (USDC) — 70 bps lower than last week.

• ~3.26% on Aave (USDe) — utilisation at ~75%. 70 bps higher than last week.

• ~4.8% on Maple (syrupUSDC).

Fixed-rate DeFi lending: yield premium in fixed markets marginally expanding from last week:

• Pendle sUSDAi: ~9.8% (Oct 2026 – Feb 2027 maturities).

• sUSDe: ~4.3% - 10 bps higher than last week.

ETH yield benchmarks:

• Lido staking: ~2.2% - 10 bps higher than last week.

About Re7

Re7 Capital is a research-driven digital asset investment firm specialising in DeFi yield and liquid alpha strategies.

Disclaimers

The content is for informational purposes only. None of the content is meant to be investment advice. Use your own discretion and independent decision regarding investments. The opinions expressed in all Re7 public research articles are the independent opinions of the authors at the time of publication and not the opinions of the affiliates of Re7.

Please see here for full disclaimers.

Stay informed about what matters in crypto. Forget the noise. Get free market-leading crypto research by subscribing to Re7 Capital’s research below:

Subscribe now

Re7 incubated @fate_computer, a controlled experiment in prediction-market baskets.

Prediction markets are increasingly being explored as sources of event-based information and market-implied probabilities. The market for truth, offering unique hedging opportunities.

Fate is an experimental interface, organising publicly available prediction-market data into thematic baskets. The first theme is Chaos vs Stability.

Fate also introduces a key feature, previously missing from the prediction market structure: roll. As markets expire, baskets roll into new methodology-selected markets, turning them into instruments working in perpetuity.

For more information: https://fate.computer/

Weekly Summary

We cover:

• Why DeFi yield is making a comeback

• Three markets signalling stronger leverage demand

DeFi Yield Is Back!

The last few months told a familiar story: yields compressed, headlines declared the trade dead, capital drifted to T-bills. That narrative is now out of date.

Across three corners of the market — private credit, Ethena's stablecoin complex, and tokenised equity perps — the demand signals are pointing the same way.

Leverage demand is rising, and where there's leverage demand, there's yield.

These are three examples among many. Together, they illustrate a broader trend emerging across on-chain markets.

Private Credit

SyrupUSDC utilisation has sat near 97–99% since late April and hasn’t left. Lenders are fully deployed.

Against that backdrop, trailing XIRR rose from below 4.4% in April to around 4.9% three months later.

That combination matters because, at this level of utilisation, the pool sits on the steep part of the rate curve.

With no idle liquidity to absorb new borrow demand, even small increases in borrowing or declines in supply drive rates sharply higher.

The yield trending higher off a near-maxed pool tells you demand is firming, and the rate has room to climb from here. The pool isn't having to compete for borrowers.

Stablecoin Complexes

Borrow rates are a demand signal and we’re seeing that with Ethena assets. USDe borrow costs on Aave are climbing, and the primary reason to pay these rates is to loop sUSDe.

Rising borrow means the bid for that trade is alive and growing.

That’s the opposite of a dead-yield market. When yields are actually dead, borrow rates fall and utilisation collapses because nobody wants leverage.

Right now we have the reverse: demand for leverage is rising, not fading.

Stocks and Perpetuals

The clearest yield of the three is sitting in tokenised equity perps.

Annualised funding on Hyperliquid stock markets is running hot — LITE, AVGO and ZM current funding above 40%, and a broad set of names (AMZN, COIN, ORCL, META, SPCX) holding double-digit annualised rates across weekly and monthly windows.

Positive funding means longs are paying shorts. That’s harvestable: short the perp, buy the underlying, and collect the funding rate as carry while staying delta-neutral.

When funding holds at these levels across a basket rather than a single name, it stops being noise and starts being a repeatable yield strategy.

The Bottom Line

The common thread is simple: leverage demand is returning.

Private credit is repricing higher, borrow demand for sUSDe is strengthening, and tokenised equity perps are generating attractive funding carry. These are all signs that users are once again willing to pay for on-chain leverage.

The narrative has been that DeFi yield is dead. The data suggest otherwise. As leverage demand continues to build, we expect yield opportunities to broaden and improve.

State of Yields

Stablecoin lending yields:

• ~4.04% on Aave (USDC) — 70bps higher than last week.

• ~3.26% on Aave (USDe) — utilisation at ~54%. Slightly higher utilisation vs. last week.

Fixed-rate DeFi lending: yield premium in fixed markets marginally expanding from last week:

• Pendle sUSDAi: ~9.62% (Oct–Feb 2026 maturities)

• sUSDe: ~4.2% - 30bps higher than last week

ETH yield benchmarks:

• Lido staking: ~2.17% - slight increase from last week.

About Re7

Re7 Capital is a research-driven digital asset investment firm specialising in DeFi yield and liquid alpha strategies.

Disclaimers

The content is for informational purposes only. None of the content is meant to be investment advice. Use your own discretion and independent decision regarding investments. The opinions expressed in all Re7 public research articles are the independent opinions of the authors at the time of publication and not the opinions of the affiliates of Re7.

Please see here for full disclaimers.

Stay informed about what matters in crypto. Forget the noise. Get free market-leading crypto research by subscribing to Re7 Capital’s research below:

Subscribe now

Re7 incubated @fate_computer, a controlled experiment in prediction-market baskets.

Prediction markets are increasingly being explored as sources of event-based information and market-implied probabilities. The market for truth, offering unique hedging opportunities.

Fate is an experimental interface, organising publicly available prediction-market data into thematic baskets. The first theme is Chaos vs Stability.

Fate also introduces a key feature, previously missing from the prediction market structure: roll. As markets expire, baskets roll into new methodology-selected markets, turning them into instruments working in perpetuity.

For more information: https://fate.computer/

Weekly Summary

We cover:

• The rise of onchain IPO markets

• Hyperliquid’s pre-IPO price discovery

• Cerebras & SpaceX vs Wall Street pricing

The Rise of Onchain IPO Price Discovery

When Hyperliquid launched pre-IPO markets, many dismissed them as little more than speculative side markets. Today they look increasingly useful.

Over the past year, Hyperliquid’s pre-IPO contracts have consistently converged towards where companies ultimately begin trading, providing an independent source of price discovery before companies list publicly.

This is despite pre-IPO markets accounting for just 0.4% of onchain RWA value today.

How Hyperliquid’s pre-IPO market works

Unlike a traditional IPO bookbuilding process, Hyperliquid simply creates a perpetual market linked to an upcoming listing.

The exchange publishes an initial reference price and then steps aside.

From that point, price is determined entirely by buyers and sellers on Hyperliquid’s fully onchain order book. There are no investment banks marketing the deal, no allocations to preferred clients and no discretionary pricing committee.

The interesting question is whether these markets are actually informative.

Increasingly, the answer appears to be yes.

Cerebras

Cerebras priced its IPO at $185 per share on 13th May 2026. On Hyperliquid, traders valued it closer to $354 before listing.

When Nasdaq opened, Cerebras began trading at $350.

Hyperliquid missed by just over 1%.

SpaceX

The same pattern emerged. SpaceX’s IPO was priced at $135 on 11th June 2026. Hyperliquid’s price started oscillating around $160 in the days leading up to the listing.

The stock opened at $150, before finishing its first day near $161.

Again, the decentralised market was remarkably close to where public investors ultimately valued the company.

The Next Test: CXMT

The latest example is ChangXin Memory Technologies (CXMT), whose IPO attracted demand exceeding 570x the shares on offer.

Hyperliquid launched its pre-IPO market with a $5 reference price. Within the first 24 hours, the market traded roughly $1.3 million of volume and repriced the contract to around $9, implying investors expect a materially higher valuation ahead of the company’s upcoming listing.

Why does this matter?

Investment banks deliberately don’t optimise for perfect price discovery.

Their objective is to execute a successful offering, build long-term institutional relationships and minimise the risk of a weak IPO. That often means pricing conservatively, leaving some upside for investors who receive allocations.

Permissionless markets optimise for something different. They continuously aggregate information from anyone willing to take risk, updating prices every second as new information emerges.

They don’t replace traditional IPOs but they do provide a real-time estimate of where a broad market believes fair value lies before the opening bell.

For the first time, investors don’t need to wait until Nasdaq opens to discover what the market thinks a company is worth. The market has already told them.

Market Update

Global crypto market capitalisation has been tightening within a wedge as seller momentum has slowed significantly.

Volatility has been suppressed to such an extent that a larger breakout move is becoming increasingly likely in either direction.

This makes sense given the wedge pattern the market is showing is expected to resolve within the next ~25 days.

Crypto markets closed the week up 16% versus the NASDAQ from the June 2026 bottom.

Over the past several weeks, we've highlighted the clear seller exhaustion in the ratio, with relative outperformance increasingly looking likely.

ETH stole the show last week - up +2% vs. BTC and so far printing a 3rd consecutive positive month.

It’s now looking to confirm 2 pattern breakouts at the same time which can often be a more powerful signal of momentum change.

Alt coin market cap dominance has remained steady as we would expect at this stage in the economic cycle.

We expect capital to rotate further into alt coins at the end of summer/start of autumn as the sharp economic recovery continues to feed through to crypto markets.

State of Yields

Stablecoin lending yields:

• ~3.22% on Aave (USDC) — utilisation rates have come down slightly to 89%.

• ~3.29% on Aave (USDe) — utilisation at ~54%. Slightly higher utilisation vs. last week.

Fixed-rate DeFi lending: yield premium in fixed markets marginally expanding from last week:

• Pendle sUSDAi: ~8.82% (Oct–Feb 2026 maturities)

• sUSDe: ~4.47%

ETH yield benchmarks:

• Lido staking: ~2.15% - slight decrease from last week

About Re7

Re7 Capital is a research-driven digital asset investment firm specialising in DeFi yield and liquid alpha strategies.

Disclaimers

The content is for informational purposes only. None of the content is meant to be investment advice. Use your own discretion and independent decision regarding investments. The opinions expressed in all Re7 public research articles are the independent opinions of the authors at the time of publication and not the opinions of the affiliates of Re7.

Please see here for full disclaimers.

Stay informed about what matters in crypto. Forget the noise. Get free market-leading crypto research by subscribing to Re7 Capital’s research below:

Subscribe now

Re7 incubated @fate_computer, a controlled experiment in prediction-market baskets.

Prediction markets are increasingly being explored as sources of event-based information and market-implied probabilities. The market for truth, offering unique hedging opportunities.

Fate is an experimental interface, organising publicly available prediction-market data into thematic baskets. The first theme is Chaos vs Stability.

Fate also introduces a key feature, previously missing from the prediction market structure: roll. As markets expire, baskets roll into new methodology-selected markets, turning them into instruments working in perpetuity.

For more information: https://fate.computer/

Weekly Summary

We cover:

• The evolution of prediction markets

• Why thematic strategies matter

• FATE: a new prediction market primitive

• Market update

Structured Prediction Markets

Prediction markets have quietly become one of crypto's most successful consumer products.

Volumes and transaction count are consistently printing new ATHs each week.

More interestingly is that prediction market-based volumes are now 70% of all on-chain spot DEX volumes and is on track to overtake within 3 months.

Prediction markets have become popular because they allow people to express views on everything from politics and macro to geopolitics, sport and technology. In many cases, they have become a better gauge of sentiment than traditional polling or media narratives.

The problem is that expressing a view today is surprisingly difficult.

If you believe tariffs will rise, geopolitical tensions will escalate, or a particular political party will outperform, you don’t buy “the thesis”. You buy dozens of individual event contracts. Each has its own liquidity, expiry, settlement criteria and execution risk. As markets resolve, positions need replacing if you want to maintain the same exposure.

In other words, prediction markets have solved price discovery, but they haven’t yet solved portfolio construction.

Just as ETFs abstract away the complexity of buying dozens of individual stocks, prediction markets need products that abstract away hundreds of individual event contracts into a single, investable strategy.

Users should be able to express a view without worrying about market selection, rebalancing, rolling positions or execution.

This week we're excited to announce FATE, our framework for turning prediction-market strategies into tradeable on-chain products.

The first products built on FATE are Order and Chaos—two thematic strategies representing opposing worldviews.

Order expresses a world of improving geopolitical stability, easing macro uncertainty and greater policy predictability.

Chaos expresses the opposite: escalating conflict, political disruption and rising uncertainty. Rather than managing dozens of individual event markets, investors simply gain exposure to a diversified basket aligned with that thesis.

Rather than buying individual event markets, FATE allows users to gain exposure to a managed basket of positions representing a single thesis.

The underlying markets can evolve over time as events resolve, while the product continues to track the strategy the user actually wanted to own.

Just as ETFs transformed individual stocks into investable themes, we believe prediction markets will evolve from isolated events into investable strategies.

Market Update

Crypto was largely unchanged last week, but volatility continues to compress inside a clear wedge.

BTC oscillated ~$64k throughout the week.

The setup increasingly resembles a coiled spring. With RSI showing bullish divergence, the next pressure release looks more likely to resolve higher than lower.

Some L1 ratios are arguably signalling a constructive view looking ahead too (e.g. SOL/BTC) by already breaking out of their own wedge pattern.

Korea’s KOSPI is making headlines for its 9% drawdown with fears of a semi conductor slowdown.

Meanwhile, AI and large-cap tech have already been rewarded for the next phase of digital infrastructure demand. Crypto has not.

The Crypto/NDX ratio shows that disconnect clearly. After two years of underperformance, crypto is back near long-term relative support and deeply oversold versus high-growth technology.

This matters because crypto is increasingly exposed to the same infrastructure themes the market is already paying for elsewhere: AI compute, stablecoin settlement, tokenisation, machine-native payments and on-chain capital markets.

The setup is not simply “crypto is cheap.” It is that one part of the digital infrastructure trade has already re-rated, while crypto remains the lagging expression.

On the monthly timeframe, the ratio has refused to break cycle lows putting in a ‘9’ DeMark count in June - where 9s have been historically reliable bottom/top signals.

State of Yields

Stablecoin lending yields:

• ~3.27% on Aave (USDC) — utilisation rates have come down slightly to 90%.

• ~3.82% on Aave (USDe) — utilisation at ~60%. Slightly higher utilisation vs. last week.

Fixed-rate DeFi lending: yield premium in fixed markets marginally expanding from last week:

• Pendle sUSDAi: ~9.8% (Oct–Feb 2026 maturities)

• sUSDe: ~4.35%

ETH yield benchmarks:

• Lido staking: ~2.19% -slight decreased from last week.

About Re7

Re7 Capital is a research-driven digital asset investment firm specialising in DeFi yield and liquid alpha strategies.

Disclaimers

The content is for informational purposes only. None of the content is meant to be investment advice. Use your own discretion and independent decision regarding investments. The opinions expressed in all Re7 public research articles are the independent opinions of the authors at the time of publication and not the opinions of the affiliates of Re7.

Please see here for full disclaimers.

Stay informed about what matters in crypto. Forget the noise. Get free market-leading crypto research by subscribing to Re7 Capital’s research below:

Subscribe now

Subscribe to Re7's Telegram group for the latest Re7 news and crypto market updates!

Weekly Summary

We cover:

• Why tokenised stocks are reaching an inflection point, as assets, holders and trading volumes climb to new all-time highs.

• How Backpack’s SpaceX launch demonstrated growing demand for on-chain equity markets and a new model for stock issuance.

• Why Solana has emerged as the dominant settlement layer for tokenised stocks, capturing almost all trading activity today.

• Market update

The Rise of Tokenised Equities

Last week we looked at the rise of RWA perpetuals. This week, we turn to the underlying assets.

Tokenised stocks are blockchain-based representations of publicly traded equities, allowing investors to buy and transfer them using crypto-native wallets and infrastructure.

The market remains small relative to global equities, but adoption appears to now be accelerating.

The total value of distributed tokenised equities has increased almost fivefold over the past 18 months to nearly $2 billion, with most of that growth occurring over the last year.

Adoption has broadened alongside capital. The number of holders has climbed to more than 400,000, also an all-time high.

Rather than being concentrated in a single issuer or equity, participation has expanded across multiple assets, suggesting adoption is becoming increasingly broad-based.

Secondary market activity is accelerating as well. Spot trading volumes reached record highs in recent weeks, driven in part by the launch of tokenised SpaceX shares.

Even excluding this event, monthly spot volumes are roughly six times higher than at the start of the year, pointing to sustained rather than event-driven growth.

Backpack emerged as one of the early leaders.

Unlike platforms that simply provide synthetic price exposure, Backpack combines regulated brokerage infrastructure with on-chain settlement, creating a direct link between tokenised shares and the underlying security. That structure helped it capitalise on demand around the SpaceX listing.

Nearly 95% of tokenised equity trading volume now settles on Solana. That dominance is likely to compress as competing ecosystems launch their own products, but it highlights an important dynamic: liquidity follows issuance. Where issuers choose to launch increasingly determines where trading activity concentrates.

That share will likely decline as competing ecosystems launch their own products, but it demonstrates an important dynamic: liquidity follows issuance.

Tokenised equities remain tiny compared to global equity markets, but the direction of travel is becoming increasingly clear.

The infrastructure is now largely in place. The next phase is less about proving tokenisation works and more about expanding the universe of assets that can be listed on-chain.

Market Update

Crypto markets have now rebounded 7% MTD, broadly in line with where we expected the next impulse higher to begin.

BTC is showing clear seller exhaustion on the monthly chart (DeMark 9 count) right around the longer-term trend.

It’s not just BTC, ETH is also showing clear seller exhaustion on the monthly at its own longer-term support zone.

SOL is the same too…

In fact, its the whole of the altcoin market that has become so oversold.

Altcoins have outperformed broader crypto beta by 2% MTD.

Prices continue to hold major long-term support while momentum improves beneath the surface, consistent with a transition from distribution to accumulation.

With broader equity leadership beginning to narrow, the conditions are increasingly in place for capital to rotate back into crypto.

Crypto/NDX has now confirmed seller exhaustion on longer-term timeframes. Technically, the stage appears set for a rotation back into crypto…

State of Yields

Stablecoin lending yields:

• ~3.01% on Aave (USDC) — utilisation rates have come down slightly to 87%. Slight yield compression from prior week.

• ~3.82% on Aave (USDe) — utilisation at ~59%. Slightly higher utilisation vs. last week.

Fixed-rate DeFi lending: yield premium in fixed markets marginally expanding from last week:

• Pendle sUSDAi: ~9.61% (Oct–Feb 2026 maturities)

• sUSDe: ~4.07%

ETH yield benchmarks:

• Lido staking: ~2.3% - no material change from prior week.

About Re7

Re7 Capital is a research-driven digital asset investment firm specialising in DeFi yield and liquid alpha strategies.

Disclaimers

The content is for informational purposes only. None of the content is meant to be investment advice. Use your own discretion and independent decision regarding investments. The opinions expressed in all Re7 public research articles are the independent opinions of the authors at the time of publication and not the opinions of the affiliates of Re7.

Please see here for full disclaimers.

Stay informed about what matters in crypto. Forget the noise. Get free market-leading crypto research by subscribing to Re7 Capital’s research below:

Subscribe now

Re7 Capital wins Best Performing Fund in DeFi at The Hedge Fund Journal’s Digital Currency Awards 2026

Re7 Capital’s market-neutral fund has won an award in the DeFi category — Best Performing Fund in 2025 and over 2 and 3 Years — at The Hedge Fund Journal‘s Digital Currency Awards 2026.

Re7 Labs is hiring a Senior DeFi BD Lead

Re7 Labs, the strategy curation arm of Re7 Capital, is hiring a Senior DeFi BD Lead to own its pipeline across vault deployments, ecosystem partnerships, and tokenised fund distribution.

The role sits at the heart of Re7's growth, working closely with leadership to expand its footprint across DeFi.

Apply here → Link

Weekly Summary

We cover:

• Why STRC is trading below par, and what the market is really saying about Bitcoin-backed credit risk.

• The rise of RWA perpetuals, as volumes reach new highs and on-chain venues capture an increasing share of activity.

• Why equities could be next, and how new listing frameworks are expanding crypto’s addressable market beyond digital assets.

Market Update

Crypto markets have continued to consolidate around the $2T mark with no rotation yet from previously leading sectors like semiconductors and hyperscalers.

Yet, downside momentum appears to be exhausted right around the 18 month support area.

The AI trade has been cooling off just as forward looking global liquidity trends indicated that would be the case for the next month…right on cue.

This has meant AI-centric themes within crypto have been the worst relative performers in the last two weeks with orthogonal themes (e.g. DeFi being the only positive sector nominally in the same time period).

With compute increasingly underpinning economic activity, semiconductor sales have become a useful leading indicator for broader capex trends.

Historically, investment, hiring and economic activity have followed where chip demand leads.

The recent surge in semiconductor sales suggests business investment is more likely to reaccelerate than roll over, reinforcing the constructive signal from improving liquidity conditions.

STRC

Over the past few weeks, Strategy’s STRC has been at the centre of market debate. Despite being structured to trade around its $100 issue price, the security has fallen materially below par.

At lower prices, investors can buy STRC at a discount and receive a higher effective yield. On paper, that should make the security more attractive. In practice, the discount reflects the market demanding more compensation for the underlying risk.

The reason is likely very simple: while STRC is marketed as an income product, investors increasingly view it as a credit instrument whose risk is closely tied to the price of Bitcoin.

Bitcoin’s price explains a significant portion of the variation in STRC’s credit spread. As Bitcoin falls, investors demand a higher spread over comparable Treasuries, pushing STRC’s price lower and its implied yield higher.

This is because Strategy’s ability to pay STRC dividends ultimately depends on a balance sheet dominated by Bitcoin, so when Bitcoin falls, investors worry the income stream is less secure and demand a higher return to hold it.

The takeaway is that STRC’s $100 target price is not a hard peg. It is a management objective, not a guaranteed floor. As long as Bitcoin remains the dominant driver of Strategy’s balance sheet risk, STRC will likely trade less like a stable income product and more like a junior Bitcoin credit instrument, driven by BTC’s direction and volatility.

RWA Perps

RWA perpetual futures have quietly become one of the fastest-growing segments in crypto derivatives. Weekly RWA perp volume has risen from less than $1 billion a year ago to ~$30 billion today, reflecting growing demand for synthetic exposure to traditional assets without leaving crypto-native venues.

So far, that growth has been overwhelmingly driven by commodities.

Gold and silver accounted for over 70% of RWA perp volume last week, benefiting from strong price trends and elevated volatility throughout the past year.

However, this concentration is unlikely to persist as new RWA markets come online.

The next phase of growth is likely to come from equities. Integrations such as Hyperliquid's HIP-3 framework are making it easier for venues to list and distribute new markets, while a growing number of exchanges are exploring tokenised equities and equity-linked perpetuals.

As the product set expands, equity exposure could become a much larger share of RWA trading activity.

Despite rapid growth, RWA perpetuals still account for just 6.2% of total perp volume today, although they already represent roughly 27% of on-chain perp volume.

That on-chain share has room to expand further because RWA perps address a much larger opportunity set than crypto alone, spanning equities, commodities, FX and eventually other traditional asset classes.

Open interest is still only approximately $3.6 billion, suggesting the market remains early, with significant room for liquidity, capital formation and product breadth to grow.

State of Yields

Stablecoin lending yields:

• ~3.2% on Aave (USDC) — utilisation rates have come down slightly to 90%. No change in yield or utilisation rates from prior week.

• ~3.8% on Aave (USDe) — utilisation at ~57%. Slightly lower utilisation vs. last week.

Fixed-rate DeFi lending: yield premium in fixed markets marginally expanding from last week:

• Pendle sUSDAi: ~9.17% (July-Oct 2026 maturities)

• sUSDe: ~4.34%

ETH yield benchmarks:

• Lido staking: ~2.32% - no change from prior week.

About Re7

Re7 Capital is a research-driven digital asset investment firm specialising in DeFi yield and liquid alpha strategies.

Disclaimers

The content is for informational purposes only. None of the content is meant to be investment advice. Use your own discretion and independent decision regarding investments. The opinions expressed in all Re7 public research articles are the independent opinions of the authors at the time of publication and not the opinions of the affiliates of Re7.

Please see here for full disclaimers.

Stay informed about what matters in crypto. Forget the noise. Get free market-leading crypto research by subscribing to Re7 Capital’s research below:

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Re7 Capital wins Best Performing Fund in DeFi at The Hedge Fund Journal’s Digital Currency Awards 2026

Re7 Capital’s market-neutral fund has won an award in the DeFi category — Best Performing Fund in 2025 and over 2 and 3 Years — at The Hedge Fund Journal‘s Digital Currency Awards 2026.

Weekly Summary

We cover:

• The emergence of AI agents as participants in the digital economy.

• How payment standards such as x402 are enabling machine-to-machine commerce.

• Why intent-based systems could become the coordination layer for autonomous software.

• Market update

Building The Rails For The Agentic Economy

Much of the AI conversation remains focused on models becoming smarter. Increasingly, however, the more interesting development may be that AI agents are becoming economic actors.

Recent conversations with digital banks suggest the industry is already preparing for this shift. One bank has launched accounts designed for AI agents, while another plans to do so later this year.

The model is straightforward: agents can initiate payments across bank rails, cards, stablecoins and blockchains, while a human or legal entity remains ultimately responsible for approval and liability.

x402 And Machine-to-Machine Commerce

The supporting infrastructure is beginning to emerge. x402, a payment standard designed for machine-to-machine commerce, recently reached a five-month high in transaction count, while daily payment volume has increased from roughly $30k to $90k.

Rather than relying on subscriptions, agents can pay fractions of a dollar for data, inference, APIs and software tools on demand.

This is no longer confined to a single ecosystem. Ripple recently integrated x402 support, extending the standard beyond its original environment and highlighting a broader trend:

Intents Gain Share

At the same time, intent-based interoperability is gaining share. Intent-based bridges now account for more than 20% of bridge volume, roughly double their share a year ago.

Rather than forcing users—or eventually AI agents—to manually navigate chains, bridges and settlement routes, intent systems allow participants to specify an outcome while the network determines how to execute it.

Protocols such as NEAR Intents have been among the beneficiaries of this shift.

The numbers remain small today, but the stack is beginning to form. Payment standards allow agents to transact, while intent systems allow them to coordinate activity across networks.

Much of crypto’s infrastructure was originally built to help humans move assets between applications. Increasingly, it is being adapted to help software transact and coordinate with other software.

If AI agents become meaningful consumers of digital goods and services, these rails could become foundational infrastructure for a machine-to-machine economy.

Market Update

Crypto markets contracted 3% last week but we’ve not seen any material technical damage. It seems that the market has been putting in a solid floor at $2.15T over the past 4 weeks - right around the 200W MA.

For BTC, this translates to ~$63k, where its failed to close below this level on the weekly so far in 2026.

Large-cap relative ratios such as SOL/BTC are breaking higher after weekly seller exhaustion and bullish divergence signals.

Historically, this has not been consistent with bear-market re-acceleration, suggesting sustained downside from current levels is becoming less likely.

October: A Window Worth Watching

While no seasonal pattern is deterministic, October stands out as one of the strongest months for Bitcoin historically, delivering average returns of +13.4%, a median return of +10.9%, and a positive hit rate of 67%.

This year, the setup is more interesting because October also sits at an important point in the halving cycle. October 2026 is roughly month 30 after the April 2024 halving, marking the end of the weakest historical post-halving window.

Historically, returns improve materially after this point: the 31–36 month period has produced average monthly returns of +12.7% and median returns of +9.4%, followed by a still-positive 37–48 month period into the next halving.

That means October is less about one isolated month and more about the potential start of a stronger 18-month cycle window.

The timing also lines up with improving forward-looking drivers. Liquidity indicators continue to point higher into Q4, with the strongest impulse expected around October.

The regulatory backdrop remains constructive. The market had initially focused on a July 4 target for the Clarity Act, and passage in July remains possible. However, given the limited legislative window before the August recess, a September or October timeline increasingly looks like the more realistic fallback if final negotiations, including around ethics provisions, require more time.

This comes as positioning and relative performance remain washed out. The crypto-to-Nasdaq ratio recently printed a rare cluster of weekly DeMark exhaustion signals, while momentum indicators have reached some of the most oversold levels of the past decade.

A September/October window would also align with a potential BTC/Gold re-rating, should the ratio break out from the handle of its current cup-and-handle structure.

None of these factors is decisive in isolation. The more important point is the confluence: seasonality, liquidity, regulation, positioning and relative performance are all beginning to point in the same direction.

These clusters of signals often provide the most useful market insights, particularly when they emerge after a prolonged period of underperformance.

State of Yields

Stablecoin lending yields:

• ~3.17% on Aave (USDC) — utilisation rates have come down slightly to 89.3%. No change in yield or utilisation rates from prior week.

• ~4.4% on Aave (USDe) — utilisation at ~64%. Slightly lower utilisation vs. last week.

Fixed-rate DeFi lending: yield premium in fixed markets marginally expanding from last week:

• Pendle sUSDAi: ~8.7% (July-Oct 2026 maturities)

• sUSDe: ~4.42%

ETH yield benchmarks:

• Lido staking: ~2.3% - no change from prior week.

About Re7

Re7 Capital is a research-driven digital asset investment firm specialising in DeFi yield and liquid alpha strategies.

Disclaimers

The content is for informational purposes only. None of the content is meant to be investment advice. Use your own discretion and independent decision regarding investments. The opinions expressed in all Re7 public research articles are the independent opinions of the authors at the time of publication and not the opinions of the affiliates of Re7.

Please see here for full disclaimers.

Stay informed about what matters in crypto. Forget the noise. Get free market-leading crypto research by subscribing to Re7 Capital’s research below:

Subscribe now

Last week, Re7 Labs announced a partnership with BOND to provide strategy curation and technical support for pre-deposit vaults, with deposits allocated across Re7’s actively managed onchain strategies (mRe7ETH, mRe7BTC, mRe7Yield) alongside Bond’s native yield opportunities.

Weekly Summary

We cover:

• Why RWA adoption continues to compound despite broader market volatility.

• How TradFi adoption is moving from isolated pilots into production infrastructure.

• Whether tokenisation is becoming one of crypto’s clearest structural growth themes.

TradFi's Onchain March Continues

The tokenised RWA market has grown 166% over the past year, from $25bn to $66.6bn, highlighting a trend that continues to strengthen despite broader market volatility.

Last week alone brought announcements across tokenised equities, stablecoins, payments, private markets, credit and institutional blockchain infrastructure, reinforcing the view that TradFi adoption of blockchain rails remains in a strong bull market.

Binance: TradFi Perpetuals Reach 10% of Stablecoin Volume

What it is: Binance reported that TradFi-linked perpetuals now account for roughly 10% of stablecoin trading volume, driven by growing interest in tokenised equities and 24/7 market access.

Why it is significant: This is early evidence that crypto infrastructure is beginning to attract equity trading activity, with stablecoins increasingly acting as settlement rails for traditional financial assets rather than just crypto-native markets.

Japan’s Megabanks Launch Yen Stablecoin Initiative

What it is: MUFG, SMBC and Mizuho are collaborating on a regulator-approved yen stablecoin expected to launch by March 2027, targeting payments and cross-border transactions.

Why it is significant: The involvement of Japan’s largest banks signals that stablecoins are increasingly being viewed as financial infrastructure rather than a crypto product, with regulated institutions now building directly on blockchain rails.

Citi Expands Tokenised Private Shares Offering

What it is: Citi is working with SDX to issue, settle and custody tokenised private company shares, bringing pre-IPO equity markets onto blockchain infrastructure.

Why it is significant: Tokenisation is moving beyond proofs of concept into core capital markets workflows, with one of the world’s largest banks building infrastructure for institutional private market access.

LG Builds Advertising Infrastructure on Arbitrum

What it is: LG is developing an Arbitrum-based marketplace for advertising and commerce across its global smart TV ecosystem.

Why it is significant: Adoption is expanding beyond finance into enterprise applications, with major corporates increasingly using blockchain as transaction infrastructure for real-world business processes.

Mastercard Launches Agent Pay for AI Agents

What it is: Mastercard introduced infrastructure enabling AI agents to conduct automated payments using both traditional payment rails and stablecoins.

Why it is significant: The move highlights how stablecoins are increasingly being integrated into global payment networks and positions blockchain rails as a potential backbone for machine-to-machine commerce.

Ethena Allocates $250M to Tokenised Credit

What it is: Ethena committed $250m to Securitize’s tokenised AAA CLO fund while expanding parts of its infrastructure onto Solana.

Why it is significant: The allocation demonstrates growing convergence between crypto-native capital and traditional credit markets, with RWAs increasingly becoming a core component of onchain financial products.

Digital Asset Raises ~$355M for Canton Network

What it is: Digital Asset, the company behind the Canton Network, raised approximately $355m in a round led by a16z crypto at a reported ~$2bn valuation.

Why it is significant: Continued institutional investment into blockchain infrastructure providers suggests growing conviction that tokenised financial markets will require dedicated settlement and interoperability layers tailored to regulated institutions.

Market Update

Crypto markets bounced +3% last week from the 200-week moving average, holding what appears to be a successful retest of the 2025 breakout level.

Over recent months, we have consistently highlighted the growing disconnect between crypto valuations and the underlying pace of adoption, usage and institutional participation.

With both the US and Iran now agreeing to a peace deal, oil has fallen back sharply and is moving towards $60/barrel.

This is broadly consistent with our view over recent months that Middle East tensions were likely to create short-term volatility, but not a sustained market shock. Both sides had clear incentives to avoid a prolonged escalation.

As that risk fades, the market is turning back to the bigger picture: inflation is easing, liquidity remains supportive, and central banks are still moving towards rate cuts.

At the same time, investor sentiment remains cautious, which suggests markets are not yet behaving as if the recovery story is fully priced in.

The rebound is starting to broaden beyond Bitcoin, with alts outperforming Bitcoin by +3% since the successful retest of the 200-week moving average.

The real test now is whether crypto can begin to outperform tech stocks, with the crypto/QQQ ratio printing its lowest weekly RSI on record (23) alongside DeMark seller exhaustion counts.

State of Yields

Stablecoin lending yields:

• ~3.17% on Aave (USDC) — utilisation rates have come down slightly to 89.3%

• ~4.73% on Aave (USDe) — utilisation at ~68%.

Fixed-rate DeFi lending: yield premium in fixed markets marginally expanding from last week:

• Pendle sUSDAi: ~11% (Jun-Oct 2026 maturities)

• sUSDe: ~4.7%

ETH yield benchmarks:

• Lido staking: ~2.3% - slightly down from prior week.

About Re7

Re7 Capital is a research-driven digital asset investment firm specialising in DeFi yield and liquid alpha strategies.

Disclaimers

The content is for informational purposes only. None of the content is meant to be investment advice. Use your own discretion and independent decision regarding investments. The opinions expressed in all Re7 public research articles are the independent opinions of the authors at the time of publication and not the opinions of the affiliates of Re7.

Please see here for full disclaimers.

Stay informed about what matters in crypto. Forget the noise. Get free market-leading crypto research by subscribing to Re7 Capital’s research below:

Subscribe now

Anchorage Digital now supports mRe7ETH!

This marks an important step toward institutional adoption of Re7's ETH strategy launched on Optimism.

Institutions, Digital Asset Treasuries, and other allocators with qualified custody requirements can now custody mRe7ETH through Anchorage's platform.

Weekly Summary

We cover:

• Why crypto’s latest washout may be creating opportunity rather than signalling structural weakness.

• The growing divergence between compressed crypto valuations and improving on-chain fundamentals.

• Whether peak enthusiasm in AI equities could set the stage for a rotation back into crypto.

Market Update

Oversold records

Crypto markets slumped -12.5% last week as we saw $2.58B total long liquidations in the space of 2 days. Drivers likely included sentiment around Saylor selling 32 BTC and continued rotation into tech/AI.

The net effect is that we’ve briefly re-tested the lows but has been unable to sustain a break below them.

Lower lows have been common structures before legs higher materialise. In fact, BTC is potentially forming a bullish divergence on the weekly timeframe. If confirmed, this would be only the second recorded instance, the first being around the FTX lows in November 2022…

It’s also finding stability at the 200W MA for now.

Meanwhile, ETH also reached its most oversold daily RSI reading on record, at just 13.

Adoption Without Appreciation

Crypto valuations have compressed, but the underlying usage base continues to mature.

RWA lending is a good example: despite the broader DeFi lending cycle cooling from its late-2025 peak, RWA-backed borrowing has continued to grow and now represents ~1.5% of DeFi borrowing, approaching $1bn outstanding.

The market is discounting crypto broadly, even as select categories demonstrate real adoption, deeper credit formation, and increasingly institutional use cases, with underlying DeFi protocols directly facilitating and monetising that growth.

That divergence matters. It suggests parts of DeFi are becoming less purely reflexive and more tied to durable financial activity.

In our view, RWA lending is one of the clearest examples of crypto infrastructure being used for real credit intermediation rather than just speculative leverage.

There are plenty of other examples. Take perpetual futures. Despite a weaker market backdrop, Hyperliquid has continued to grow daily active users, volumes, and fee generation. HYPE’s valuation appears to have largely tracked that adoption curve.

The broader point is that while crypto prices have been under pressure, several leading applications continue to compound fundamental usage.

In many cases, token valuations have proven far more resilient where user growth, activity, and revenues remain intact.

This is also probably why altcoin dominance has remained resilient despite broader market volatility.

Crypto’s adoption curve is still being supported by the economic cycle, and that is showing up in fundamentals across users, volumes, fees, and credit activity.

What has not happened yet is valuation outperformance. AI equities have absorbed most of the market’s attention, leaving crypto fundamentals improving beneath compressed valuations.

Changing Currents?

Two weeks ago, we covered the reasons why the gap between crypto and high growth tech/AI equities may close over the coming weeks.

Fast forward to today, we now have three prospective IPOs across SpaceX, Anthropic, and OpenAI implying a with reported/prospective raises that could exceed $190B in aggregate and valuations of $3.5T+.

At the same time, we’re seeing exhaustion signals in NDX on both daily and weekly timeframes. In other words, these IPO issuances are accelerating into peak enthusiasm.

But the most interesting chart remains the crypto/NDX ratio. Crypto is now trading relative to the NASDAQ at levels that have historically coincided with major relative bottoms.

Multiple long-term exhaustion signals have triggered, while the ratio is sitting directly on a support trend line that has held since 2019.

It is also now the most oversold on record.

On the monthly timeframe, momentum indicators are also beginning to suggest the multi-year period of crypto underperformance may be becoming stretched.

With liquidity still supportive, the setup increasingly looks less like a broader market top and more like a potential leadership rotation.

Capital may be rotating from crowded AI equities into crypto, where valuations have weakened even as underlying fundamentals continue to improve.

State of Yields

Stablecoin lending yields:

• ~3% on Aave (USDC) — utilisation rates have come down slightly from the 90%+ peaks to ~87%.

• 4.8% on Aave (MegaUSD) — same as last week again. Utilisation rates remain elevated at ~70%.

Fixed-rate DeFi lending: yield premium in fixed markets marginally expanding from last week:

• Pendle NUSD: 5.86% (Jun 2026)

• Pendle sUSDAi: ~10.1% (Jun-Oct 2026 maturities)

• sUSDe: ~5%

ETH yield benchmarks:

• Lido staking: ~2.38% - no change from prior week.

About Re7

Re7 Capital is a research-driven digital asset investment firm specialising in DeFi yield and liquid alpha strategies.

Disclaimers

The content is for informational purposes only. None of the content is meant to be investment advice. Use your own discretion and independent decision regarding investments. The opinions expressed in all Re7 public research articles are the independent opinions of the authors at the time of publication and not the opinions of the affiliates of Re7.

Please see here for full disclaimers.

Stay informed about what matters in crypto. Forget the noise. Get free market-leading crypto research by subscribing to Re7 Capital’s research below:

Subscribe now

Re7 Capital has continued to expand its institutional product suite and distribution reach through Q1 and into Q2:

• ETH Yield Strategy — Re7 has launched mRe7ETH on Optimism, an ETH-denominated, market-neutral yield strategy designed for institutional allocators.

• Anchorage Digital integration - Re7 has partnered with Anchorage to allow Qualified Custody of mRe7ETH. DATs and other institutional ETH holders that are mandated to Qualified Custody can now access mRe7ETH.

• Telegram Wallet integration — Re7’s DeFi yield strategies are now available within Telegram’s self-custody TON Wallet, enabling users to access on-chain yield directly within the app.

• Zodia Custody partnership — Re7 partnered with Zodia Custody, which provides custody and off-exchange settlement, and enables on-chain representation of Re7’s BTC Yield and Market Neutral strategies.

Weekly Summary

We cover:

• Citi’s roadmap for a $5.5T tokenised securities market by 2030.

• Why stablecoins may be the key driver of tokenised Treasury adoption.

• The institutional, global and AI trends that could make the forecast achievable.

When Does A $5.5T Tokenised Securities Market Become Plausible?

Real-world assets continue to break out on-chain.

Tokenised RWAs have now reached a new all-time high of $32B, with more than 833k holders globally. Stablecoins are already much larger, with supply approaching $300B and more than 260m holders. The direction of travel is clear, but we are still very early in the broader adoption cycle.

Citi has just released a new report projecting that the tokenised securities market could reach $5.5T by 2030.

The numbers imply a steep adoption curve.

Tokenised T-bills would need to grow at roughly +256% per year from 2025 to 2030, reaching an end-state equivalent to around 15% penetration of the T-bill market.

Meanwhile, tokenised equities would need to grow even faster, at roughly +625% per year, with Citi’s $2.6T target equivalent to ~10% of the current value of NASDAQ-listed companies.

At first glance, these assumptions look aggressive.

The more interesting question is what would need to be true for them to be reasonable.

The clearest driver is stablecoins. Every additional dollar of stablecoin supply creates demand for reserve assets, primarily short-duration U.S. Treasuries. If stablecoins keep evolving into a global digital dollar network, tokenised T-bills become a natural reserve layer.

The second driver is institutional infrastructure. Banks, asset managers, exchanges and custodians are moving from pilots to production, integrating blockchain rails into custody, settlement, collateral management and fund issuance.

Regulatory clarity is also improving, with the CLARITY Act and stablecoin legislation helping reduce one of the largest blockers to institutional adoption.

Third is global distribution. Tokenisation is not just about digitising U.S. assets for U.S. investors. It is a lower-friction access layer for global capital.

The fourth driver is AI. As financial activity becomes more automated, programmable assets and always-on settlement become more valuable. Autonomous agents are more naturally suited to on-chain financial infrastructure than legacy systems built around business hours and manual reconciliation.

Citi’s forecast is aggressive but if stablecoins continue scaling, institutions keep adopting blockchain infrastructure, global investors use tokenisation as a new access layer, and AI accelerates demand for programmable finance, then the growth curve starts to look less unreasonable.

The next five years are effectively a test of whether these adoption curves compound together.

Market Update

The crypto market contracted for its third consecutive week (-3%), reaching its 2026 support line. Overall markets are tentative and buoyant sentiment remains concentrated in AI for now.

However, the expression of the AI trade will likely manifest in different ways over the long term.

While BTC looks vulnerable, the liquidity picture remains constructive. Narrow US liquidity continues to accelerate on a forward-looking basis.

AI capex has been absorbing incremental risk capital, leaving crypto behind. But if the rotation shifts from AI beneficiaries to AI infrastructure, crypto is well positioned as a key substrate for programmable payments, settlement and agents.

The crypto/NDX ratio is now approaching decade-long support, with reversal risk building over the next 1–2 weeks…

…while sitting 2 standard deviations below its log-regression trend since 2013. A bullish divergence may also be forming as these support levels come into view.

State of Yields

Stablecoin lending yields:

• ~3.3% on Aave (USDC) — utilisation rates for USDC markets are still elevated but have seemed to stabilise at ~90%.

• 5% on Aave (MegaUSD) — same as last week again. Utilisation rates at ~66%.

Fixed-rate DeFi lending: yield premium in fixed markets marginally expanding from last week:

• Pendle sNUSD: 8.57% (Jun 2026)

• Pendle sUSDAi: ~7.7% (Jun-Oct 2026 maturities)

• sUSDe: ~4%

ETH yield benchmarks:

• Lido staking: ~2.39% - slight increase from previous week.

About Re7

Re7 Capital is a research-driven digital asset investment firm specialising in DeFi yield and liquid alpha strategies.

Disclaimers

The content is for informational purposes only. None of the content is meant to be investment advice. Use your own discretion and independent decision regarding investments. The opinions expressed in all Re7 public research articles are the independent opinions of the authors at the time of publication and not the opinions of the affiliates of Re7.

Please see here for full disclaimers.

Stay informed about what matters in crypto. Forget the noise. Get free market-leading crypto research by subscribing to Re7 Capital’s research below:

Subscribe now

Last week, Evgeny Gokhberg, founder of Re7 Capital, joined Jesse Knutson on Bitfinex's Bitcoin Capital Podcast to discuss what really happens when an asset used as collateral across multiple DeFi protocols gets hacked.

The full conversation is available to watch on YouTube.

Weekly Summary

We cover:

• why privacy mindshare has accelerated across crypto

• where privacy tools and networks have, or have not, gained meaningful traction relative to valuations

• market update

Is Privacy Winning Mindshare Faster Than Adoption?

Privacy and confidential transactions have increasingly taken up crypto mindshare over the past three months, driven by rising discussion around surveillance resistance, AI agents, stablecoins, and on-chain financial privacy.

However, the key question is whether that attention is translating into actual on-chain demand. To test that, we look at observable proxies across Railgun, NEAR Intents, Zashi and Zcash.

Railgun

Railgun is a privacy protocol that lets users shield assets on public blockchains, enabling private transfers and DeFi interactions without exposing wallet balances, counterparties, or transaction details.

In practice, users deposit assets into Railgun’s private balance system, transact privately, and can later unshield back to a public address.

The chart below tracks the total count of shielded and unshielded transactions to the Railgun contract and therefore a good measure of user trust, demand, and engagement.

The interactions with the contract for both has kept steady over the past 3 months. More importantly, there are less than 100 interactions daily from users seeking to shield transactions on-chain.

NEAR Intents

NEAR Intents is NEAR’s cross-chain execution layer, letting users express an outcome such as swapping or transferring an asset, while solvers handle the routing and settlement behind the scenes.

NEAR Intents weekly volume have kept steady at ~$500m YTD so discernible growth.

But not every Intent is private: most activity can still be public routing between chains.

Private or confidential transactions on blockchains like NEAR are intentionally designed to be difficult for outsiders to track. This is not a bug but rather it’s the core feature.

So to get a proxy for demand, we have to look at the visible edges of the privacy flow.

One useful signal is Zashi, the Zcash wallet integrated with NEAR Intents. Zashi lets users move into and out of shielded ZEC while NEAR handles cross-chain routing in the background.

If usage grows here, it suggests users are not just speculating on privacy as a theme. They are actively choosing private settlement when the UX is made simple.

NEAR Intents volume routed through Zashi has declined from its November 2025 peak of roughly $300m/day to around $60m/day today.

Then again, the Near team claim that >40% of NEAR transactions were confidential so the picture is mixed.

Zcash

Zcash is a privacy-focused blockchain that uses zero-knowledge proofs to enable shielded transactions where wallet addresses and transaction amounts can remain confidential.

Historically, shielded transaction growth and ZEC price action broadly trended together, suggesting price appreciation was at least partially supported by increasing usage of private settlement infrastructure.

That relationship has started to diverge. While ZEC/USD has rallied aggressively in recent months, shielded transaction growth has remained comparatively muted. The result is a widening gap between network usage and token price performance.

This divergence suggests the recent move in ZEC has been driven more by narrative positioning around privacy and confidential transactions than by a material acceleration in underlying shielded activity itself.

Closing Remarks

The broader takeaway is that privacy mindshare is growing faster than measurable on-chain adoption.

Across Railgun, NEAR Intents, Zashi and Zcash, usage looks steady but still niche. Activity has not collapsed, but it has also not accelerated at the pace implied by recent price action.

That does not invalidate the long-term thesis. Privacy infrastructure may still be early, with demand constrained by UX, liquidity fragmentation and regulatory uncertainty.

For now, the market appears to be pricing in the future potential of private on-chain settlement faster than current usage metrics can justify.

Market Update

As the US 10Y hit 2026 peaks of 4.68%, it was no surprise that the US administration was calling for the end of the Middle East conflict. Now we have a clearer path for a re-opening of the Hormuz strait and a memorandum of understanding regarding the Uranium stockpile longer-term.

As a result, treasury yields and oil are down while risk assets and precious metals are up. BTC continues its climb once again to the 200d MA, a historically important level for longer-term market conviction.

As Brent fell from $103/bbl to $91/bbl (orange), risk assets broadly benefited, with crypto, equities and precious metals all rallying.

Russell small caps (purple) led the move, up around +5%. Crypto beta (blue) and alt coin market (red) have been in the middle of the pack.

In the current Brent pullback, however, crypto (and specifically the alt market) has been the fastest out of the gates versus other major markets and sectors.

This may signal the crypto market may be becoming somewhat overstretched after previously lagging the broader risk asset rebound.

Given crypto/NASDAQ ratio is just 1-3 weeks from printing buy signals on indicators like deMark, ultimately the bet is for the crypto-AI trade gap to close in what has been a summer season for risk assets (rising growth with rising inflation).

Mechanically, the gap can close from a confluence of reasons:

• Investors will look for the next trade if AI/tech leadership continues to perform.

• The marginal buyer is often the same speculative, liquidity-sensitive capital pool.

• Crypto is increasingly a liquid second-derivative AI trade via agents, compute, stablecoins and privacy.

• Cleaner institutional access rails make rotation into crypto easier than in prior cycles.

• Crypto has higher macro beta once geopolitical overhangs truly fade while liquidity accelerates - relative performance this week may be early signs of this.

State of Yields

Stablecoin lending yields:

• ~3.8% on Aave (USDC) — utilisation rates for USDC markets are still elevated but have seemed to stabilise at ~92%.

• 5.12% on Aave (MegaUSD) — same as last week again. Utilisation rates at 67%.

Fixed-rate DeFi lending: yield premium in fixed markets marginally expanding from last week:

• Pendle sNUSD: 8.5% (Jun 2026)

• Pendle sUSDAi: ~9.7% (Jun-Oct 2026 maturities)

• sUSDe: ~4.3%

ETH yield benchmarks:

• Lido staking: ~2.36% - same from previous week.

About Re7

Re7 Capital is a research-driven digital asset investment firm specialising in DeFi yield and liquid alpha strategies.

Disclaimers

The content is for informational purposes only. None of the content is meant to be investment advice. Use your own discretion and independent decision regarding investments. The opinions expressed in all Re7 public research articles are the independent opinions of the authors at the time of publication and not the opinions of the affiliates of Re7.

Please see here for full disclaimers.

Stay informed about what matters in crypto. Forget the noise. Get free market-leading crypto research by subscribing to Re7 Capital’s research below:

Subscribe now

Re7 Capital has continued to expand its institutional product suite and distribution reach through Q1 and into Q2:

• Anchorage Digital integration - Re7 has partnered with Anchorage to allow Qualified Custody of mRe7ETH. DATs and other institutional ETH holders that are mandated to Qualified Custody can now access mRe7ETH.

• ETH Yield Strategy — Re7 has launched mRe7ETH on Optimism, an ETH-denominated, market-neutral yield strategy designed for institutional allocators.

• Telegram Wallet integration — Re7's DeFi yield strategies are now available within Telegram's self-custody TON Wallet, enabling users to access on-chain yield directly within the app.

• Zodia Custody partnership — Re7 partnered with Zodia Custody, which provides custody and off-exchange settlement, and enables on-chain representation of Re7's BTC Yield and Market Neutral strategies.

Weekly Summary

We cover:

• where the mispricing sits across DeFi yield strategies

• how an internet-native brand builds a real ecosystem

• how the CLARITY Act is progressing and implications

The Yield You See Is the Risk You Take

Last week we argued that DeFi exploit headlines are scarier than the underlying data: losses are concentrated in the long tail, not core infrastructure.

If the market is discounting DeFi risk too broadly, the next question is where the mispricing sits.

This chart maps major DeFi yield strategies by complexity, tail risk, and APY. The relationship is clear: yield rises with structural risk. Native staking sits at 2–8% for cleaner exposure, while looping and basis trades can reach 25% only by adding liquidation, funding, and counterparty risk.

The curve is fair compensation: the return you should expect for each level of risk.

The opportunity is the gap above it. In a market that discounts DeFi risk indiscriminately, some strategies can pay more than their actual risk warrants — not because the risk has disappeared, but because sentiment has overshot.

The allocator’s question is simple: am I being paid for this risk, or just taking it?

WallStreetBets on Pudgy Penguins

WallStreetBets posted a thread highlighting Pudgy Penguins as an example of how internet-native brands are evolving.

The post focuses less on speculative market dynamics and more on the broader ecosystem: brand recognition, cultural reach, NFT roots, physical merchandise, and growing consumer distribution.

That framing now sits alongside a more formal market-structure development: Canary Capital even filed for a Pudgy Penguins-linked ETF.

The significance is that this comes from WallStreetBets, one of the most important retail-trading communities of the last cycle.

During the GameStop episode, WallStreetBets helped concentrate retail attention around a single market narrative, contributing to extreme market activity: analysis cited record trading days worth $32.46bn and $12.82bn during the 2021 rally.

WallStreetBets frames Pudgy Penguins as an example of how internet-native culture is moving beyond pure virality and towards brand distribution.

In that context, WallStreetBets placing Pudgy Penguins inside the same retail-attention lineage is notable.

Their framing is that Dogecoin proved simple, recognisable internet culture can become financialised. Pudgy Penguins is being positioned as a more developed version of that idea: a crypto-native brand with IP, community, NFTs, merchandise, mainstream touchpoints, and more than 100bn cumulative GIF views.

The key point is that Pudgy Penguins is not just an internet brand in isolation. It is an ecosystem testing whether crypto-native culture can become a wider consumer and community network.

Getting CLARITY: the Act nears a Senate vote

The CLARITY Act advanced out of the Senate Banking Committee last week, moving a U.S. crypto market structure bill closer to a full Senate vote. In simple terms, the bill aims to clarify which regulator oversees which parts of crypto markets — mainly the SEC for digital securities and the CFTC for digital commodities.

The significance is that this is broader than a stablecoin bill or another enforcement action. It is a step toward a formal U.S. rulebook for crypto, replacing years of regulatory uncertainty with clearer classifications, trading rules, and oversight.

The bill now awaits a floor vote, though no date has been set.

Market Update

BTC cooled off last week, falling 5.8% and stalling just short of its 200-day moving average after approaching it from below.

The 200d MA is a key level that investors place significant weight on. It continues to act as an important longer-term conviction level and you can see it in the performance data.

Based on the 8 times BTC has reclaimed its 200d MA since 2019, returns averaged +18% at one month, +33% at two, and +42% at three — 3-5x a random-day entry.

Put differently, the hit rate is heavily skewed to the upside across periods out to 180 days after a clear breakout.

Investors crowded the long side and got over their skis, assuming a breakout was inevitable. Long liquidations have surpassed $1.9b over the last week alone.

In other words, this looks more like a leverage washout than a change in trend.

BTC ran into a key conviction level, longs crowded the move too early, and the market forced a reset before the breakout was confirmed.

With equities still near all-time highs and liquidity conditions continuing to improve, the pullback looks more technical than macro-driven. And Bessent has every incentive to keep rates down.

This is happening as the crypto/NASDAQ ratio is roughly 2–3 weeks away from a potential DeMark buy setup, suggesting crypto may be approaching an exhaustion point relative to equities after a dramatic AI-led run in large-cap tech.

This is creating a temporary divergence between crypto’s relative performance and the broader economic growth picture. Crypto continues to lag the NASDAQ, even as the growth backdrop improves.

If that momentum continues, the gap looks increasingly difficult to sustain.

State of Yields

Stablecoin lending yields:

• ~3.36% on Aave (USDC) — utilisation rates for USDC markets are still elevated but have seemed to stabilise at ~91%.

• 5.12% on Aave (MegaUSD) — same as last week again. Higher MEGA incentives driving supply side. Looping is pulling USDm out of the pool where new suppliers keep arriving for MEGA APY.

Fixed-rate DeFi lending: yield premium in fixed markets marginally expanding from last week:

• Pendle sNUSD: 8.2% (Jun 2026)

• Pendle sUSDAi: ~10% (Jun-Oct 2026 maturities)

• sUSDe: ~4.1%

ETH yield benchmarks:

• Lido staking: ~2.37% (slight decrease from previous week)

About Re7

Re7 Capital is a research-driven digital asset investment firm specialising in DeFi yield and liquid alpha strategies.

Disclaimers

The content is for informational purposes only. None of the content is meant to be investment advice. Use your own discretion and independent decision regarding investments. The opinions expressed in all Re7 public research articles are the independent opinions of the authors at the time of publication and not the opinions of the affiliates of Re7.

Please see here for full disclaimers.

Stay informed about what matters in crypto. Forget the noise. Get free market-leading crypto research by subscribing to Re7 Capital’s research below:

Subscribe now

Re7 Capital has continued to expand its institutional product suite and distribution reach through Q1 and into Q2:

• ETH Yield Strategy — Re7 has launched mRe7ETH on Optimism, an ETH-denominated, market-neutral yield strategy designed for institutional allocators.

• Telegram Wallet integration — Re7's DeFi yield strategies are now available within Telegram's self-custody TON Wallet, enabling users to access on-chain yield directly within the app.

• Zodia Custody partnership — Re7 partnered with Zodia Custody, which provides custody and off-exchange settlement, and enables on-chain representation of Re7's BTC Yield and Market Neutral strategies.

Weekly Summary

We cover:

• Why DeFi yields are rising as capital exits the sector

• Why exploit headlines may be overstating systemic risk

• How AI and security vendors are reshaping DeFi security infrastructure

• Why risk is increasingly concentrated in weaker protocols

• The growing opportunity set across higher-quality DeFi infrastructure

DeFi Security, Risk Perception & Yield Opportunity

Capital continues to rotate out of DeFi amid elevated exploit headlines and weaker risk appetite, reducing liquidity across lending, LP, and leverage-driven strategies.

As a result, yields have moved higher while TVL has fallen. At face value, this could be interpreted as the market pricing in a deterioration in underlying protocol quality and systemic risk.

However, as we explore here, recent exploit activity presents a more nuanced picture. While headline exploit volumes remain elevated, the composition of losses increasingly points toward operational failures and weaker long-tail protocols rather than broad deterioration in core DeFi infrastructure.

The result is an environment where capital is becoming increasingly selective, concentrating in protocols with stronger operational discipline and security practices.

Security Reality Check: Exploit vs Perception

April saw roughly 30 publicly reported DeFi exploit incidents, reinforcing the perception that the ecosystem remains structurally vulnerable.

On an absolute basis, exploit volumes remain elevated and continue to weigh on investor confidence and capital formation across the sector. 2026 exploit run rate is currently ~$2.3B.

However, the ratio of total exploit volume to overall DeFi TVL continues to trend lower on a run-rate basis, suggesting realised losses are not increasing proportionately with the size of the ecosystem.

The exploit-to-DeFi TVL ratio has fallen from 7.2% in 2022 to ~1.5% in 2026 based on this run rate.

In fact, even with an additional ~$650m in exploit value from January through April, the exploit-to-DeFi TVL ratio would still have trended lower.

Both the distribution and underlying causes of recent exploits also matter materially when assessing system-level risk.

A growing share of losses appears concentrated in smaller protocols, operational failures, and weaker security practices (key management, social engineering susceptibility) rather than widespread failures in core smart contract infrastructure.

April was no exception…

Roughly 95% of losses came from just 2 incidents (Drift, Kelp DAO) where both of these were opsec-related incidents.

In other words, elevated exploit counts do not necessarily equate to rising systemic risk.

Security Infrastructure & the Evolving Risk Curve

Recent discussion around AI-driven exploits has reinforced concerns that attack capabilities are compounding faster than defensive infrastructure across DeFi.

However, recent exploit activity increasingly reflects differences in security maturity across the ecosystem rather than broad deterioration in core smart contract infrastructure.

While larger protocols have generally continued strengthening governance processes, operational controls, and vendor infrastructure over time, realised losses still demonstrate that operational discipline remains critical regardless of protocol size.

This is also creating a more selective environment where asset allocators can increasingly differentiate between protocols with robust operational processes and security frameworks versus weaker operators where exploit risk remains more concentrated.

At the same time, risk remains disproportionately concentrated among smaller and earlier-stage protocols with weaker operational setups, incomplete security processes, and limited external review — reinforcing the divergence between stronger operators and the long tail of the market.

This concentration is unsurprising given fewer than 30% of newly deployed DeFi contracts reportedly receive adequate pre-launch security reviews.

Security infrastructure across the ecosystem also continues to mature rapidly. Security is increasingly becoming baseline infrastructure rather than optional overhead, with the DeFi security market estimated at ~$4.8bn in 2025 and projected to grow at roughly 19% annually through 2034.

Concerns around AI-enabled exploit development have also accelerated materially over the last year. However, AI appears to be strengthening both attack and defence capabilities simultaneously rather than creating a one-sided deterioration in protocol security.

Investment in AI-driven DeFi security tooling exceeded an estimated $430m in 2025, while AI-augmented auditing platforms are compressing review cycles from weeks to hours.

The more important shift is that security is no longer simply a function of how much a protocol is willing to spend on internal tooling or LLM access.

Sophisticated state-sponsored actors such as Lazarus Group will likely continue to retain advantages that individual protocols cannot fully offset through tooling spend alone.

Instead, the playing field is increasingly being levelled through broader access to external security vendors, monitoring infrastructure, AI-assisted auditing, and operational tooling that are becoming more accessible and affordable across the ecosystem — including for earlier-stage protocols.

Protocol architecture is also evolving alongside security infrastructure. Architectures such as Aave V4 increasingly enable risk to be compartmentalised at the pool and asset level rather than socialised across broader ecosystems, potentially supporting more tailored institutional participation over time.

Market Implications

Capital outflows and elevated exploit headlines continue to weigh on sentiment across DeFi, contributing to higher yields and broad-based risk discounting across the sector.

At the same time, current market pricing increasingly appears to reflect broad fear around DeFi exploit risk without fully distinguishing between weaknesses in individual operators and the resilience of core protocol infrastructure.

Recent exploit activity suggests the ecosystem is facing more of a security maturity gap than a structural failure in smart contract architecture itself.

The result is an increasingly bifurcated market where yields may be compensating for perceived systemic risk more than broad deterioration in underlying protocol quality.

As capital continues to rotate out of the sector, yield opportunities across stronger protocols are in many cases becoming increasingly attractive, particularly where operational discipline, security infrastructure, and process maturity remain robust.

Positioning therefore increasingly favours higher-quality protocols with stronger security baselines, operational discipline, and institutional-grade infrastructure, while avoiding weaker long-tail exposure where exploit risk remains disproportionately concentrated.

State of Yields

Stablecoin lending yields:

• ~3.2% on Aave (USDC) — utilisation rates for USDC markets are still elevated but have seemed to stabilise at ~91%.

• 5.12% on Aave (MegaUSD) — same as last week. Higher MEGA incentives driving supply side. Looping is pulling USDm out of the pool where new suppliers keep arriving for MEGA APY.

Fixed-rate DeFi lending: yield premium in fixed markets marginally expanding from last week:

• Pendle sNUSD: 8.1% (Jun 2026)

• Pendle sUSDAi: ~10% (Jun-Oct 2026 maturities)

• sUSDe: ~4.2%

ETH yield benchmarks:

• Lido staking: ~2.42% (slight increase from previous week)

About Re7

Re7 Capital is a research-driven digital asset investment firm specialising in DeFi yield and liquid alpha strategies.

Disclaimers

The content is for informational purposes only. None of the content is meant to be investment advice. Use your own discretion and independent decision regarding investments. The opinions expressed in all Re7 public research articles are the independent opinions of the authors at the time of publication and not the opinions of the affiliates of Re7.

Please see here for full disclaimers.

Stay informed about what matters in crypto. Forget the noise. Get free market-leading crypto research by subscribing to Re7 Capital’s research below:

Subscribe now

Last week, Re7 Capital introduced the Re7 ETH Yield Strategy, anchored on Optimism and powered by the Re7 Risk Engine. The strategy delivers structured exposure to ETH-denominated yield opportunities through the same onchain architecture that underpins Re7’s broader institutional platform.

Built to generate risk-adjusted returns across the Ethereum ecosystem, the strategy combines transparent onchain representation of investor positions with institutional-grade custody infrastructure, ensuring counterparty and settlement risks remain tightly managed.

The launch highlights continued institutional demand for onchain yield strategies that align Ethereum’s growing utility with the rigor and operational standards of traditional investment frameworks. Read more on our blog.

Weekly Summary

We cover:

• The state of yield aggregators

• Why yield aggregators struggled to attract capital longer-term

• Market update

From Abundance to Scarcity: Rethinking Yield Aggregation

DeFi once promised easy, automated yield on idle crypto capital.

Yield aggregators are protocols that pool user funds and automatically deploy them across strategies to maximize returns.

Built for a high-emissions, high-inefficiency era of DeFi, they thrived on subsidised yields and passive optimization—but as incentives faded, yields compressed, and capital became more selective, that edge eroded.

Global yield aggregator TVL has seen wild swings over the past six years. Today, it sits at just 10% of its 2021 ATH of $1.48B, despite the broader market being up 355% since that peak.

2020-2021: Heavy incentives + leverage created the bulk of expansion (e.g. COMP, CRV)

2022: Deleveraging and the incentive death (leveraged loops collapsed, market valuation fell) — the underlying yield engine broke

2023-2024: Lower ‘real’ yields, fewer reflexive loops to boost TVL — TVL stabilised because DeFi shifted from growth to an equilibrium

2025-present: RWAs, restaking, new primitives bringing in incremental capital alongside market beta lifting valuations. Yields remained compressed, capital is rotating toward RWAs and higher risk–reward yield strategies

In other words, one of the biggest drivers isn’t price but reflexivity. When incentives attract capital, that capital can boost yields and those yields attract more capital.

When that loop breaks, TVL deflates structurally. That’s why rebounds look weaker. Prices came back, but the old yield engine didn’t.

RWAs Reset The Benchmark

Tokenised real-world assets (e.g. on-chain T-Bills) effectively introduced a new hurdle rate in DeFi:

• 4-5% yields with perceived lower smart contract risk overall

• Caters for institutional and more conservative capital

• More predictable, cleaner return profile

We can see some evidence of the impact of US T-bills on yield aggregator TVL — where the recent surge of the former has coincided with the collapse of the latter’s TVL over the last year.

Curation Didn’t Fix the Model

Several platforms tried to evolve the yield aggregation model by launching curated, semi-private vaults. These platforms prioritised access to better opportunities rather than optimising public yields.

But traction has been limited because it still relies on the same underlying engine: external incentives flowing into the platform.

As we can see in the below diagram, when the incentive layer dried up, the entire loop weakened.

Closing Remarks

As yields collapsed, platforms evolved—moving from passive aggregation to curated access and allocation—but still relied on the same incentive-driven engine. When that dried up, the model weakened regardless of structure.

But capital didn’t disappear—it just relocated to RWAs, protocol-native strategies, and simpler yield. The abstraction layer lost relevance in that process.

Looking into the future, they could regain relevance if they evolve into active, strategy-driven allocators—routing capital into differentiated, higher-quality yield sources rather than passively optimising commoditised ones.

When excess yield disappears, so does the need to aggregate it.

Market Update

Global crypto market capitalisation was relatively flat last week (-0.6%), finding resistance at the top of ascending channel ($2.26T) after its recent breakout.

This week looks to be more of the same with initial break above the channel again in the early hours on Monday.

BTC is exhibiting a similar structure, acting as a high-beta proxy to broader risk, with the 120D EMA as the key level to reclaim to confirm momentum re-acceleration.

BTC briefly broke >$80,500 on Monday morning UTC — there is a heavy cluster of sellers at this level, which it needs to clear.

Despite the recent market chop over the last few days, the crypto market is outperforming all major assets/themes on a relative basis MTD (May).

This relative outperformance isn’t surprising given the current backdrop of rising US net liquidity—where crypto, sitting furthest out on the risk curve, acts as a high-beta, low-friction expression of that environment.

…while the US are now firmly in QE (not QE!) mode, re-buying and holding US Treasuries on their balance sheet.

Balance sheet expansion, higher bank reserves lead to easier financial conditions.

This also explains why recent commodity-driven inflation scares haven’t weighed on crypto—liquidity is the dominant driver, and markets are looking through near-term price pressures.

If higher inflation drives real rates negative into 2026/2027, crypto stops competing with real return just as the Fed becomes boxed in—forcing a turn toward renewed liquidity as they get behind the curve (again).

State of Yields

Stablecoin lending yields:

• ~3.8% on Aave (USDC) — utilisation rates for USDC markets are still elevated but have seemed to stabilise at 92%.

• 5.12% on Aave (MegaUSD) — higher MEGA incentives driving supply side. Looping is pulling USDm out of the pool where new suppliers keep arriving for MEGA APY.

Fixed-rate DeFi lending: yield premium in fixed markets marginally expanding from last week:

• Pendle sNUSD: 7.3% (Jun 2026)

• Pendle sUSDAi: ~8.4% (Jun-Oct 2026 maturities)

• sUSDe: ~5.3%, slightly up from ~3.9% last week as sUSDE TVL has dropped from $3.5b to $2.1b since the 18th of April

ETH yield benchmarks:

• Lido staking: ~2.38% (slight drop from previous week)

About Re7

Re7 Capital is a research-driven digital asset investment firm specialising in DeFi yield and liquid alpha strategies.

Disclaimers

The content is for informational purposes only. None of the content is meant to be investment advice. Use your own discretion and independent decision regarding investments. The opinions expressed in all Re7 public research articles are the independent opinions of the authors at the time of publication and not the opinions of the affiliates of Re7.

Please see here for full disclaimers.

Stay informed about what matters in crypto. Forget the noise. Get free market-leading crypto research by subscribing to Re7 Capital’s research below:

Subscribe now

Last week, Re7 Capital launched the Re7 ETH Yield Strategy, anchored by Optimism and underpinned by the Re7 Risk Engine. The strategy provides structured exposure to ETH-denominated yield opportunities, delivered through the same onchain architecture as Re7’s existing institutional offerings.

Designed to generate risk-adjusted returns from the Ethereum ecosystem, the strategy maintains the operational standards institutional allocators require. Investor interests are represented transparently onchain and supported by institutional-grade custody infrastructure, keeping counterparty and settlement risk tightly controlled.

The launch reflects continued institutional appetite for onchain yield strategies that pair Ethereum’s expanding utility with the discipline of traditional investment structures. Read more on our blog.

Weekly Summary

We cover:

• Risk-on signals despite geopolitical backdrop

• Crypto outperformance vs. equities and precious metals

• Sentiment indicators suggesting recovery but far from euphoric levels

• Where cross-asset trends are aligning with liquidity

State of the Market Since the Iran Escalation

It has now been over two months since the start of the Middle East conflict between the US and Iran.

The immediate narrative following the February 28th strikes on Iran was predictable: geopolitical escalation should depress risk assets and drive flows into traditional safe havens.

However, price action across macro and crypto markets suggests a different interpretation — a reminder that the market is not the economy. Meanwhile, big banks are seeing record earnings. GDP growth are beating estimates. Hm seems off.

Let’s run through the market data to see the state of play…

Key Sectors/Indices

Brent crude is in a broad range with a slight downward drift, with the bias being to sell strength rather than chase longs.

Despite oil prices briefly touching >100, broader market volatility has come down as negotiated resolution gets priced as the most likely outcome.

Dollar is now trading below where it was after the first week of strikes, with dollar weakness essentially becoming a de-escalation trade.

Higher energy prices may lead to rising rate expectations in Europe but, since the conflict began, investors are now pricing in Fed cuts this year…

BTC has rallied +23.4% off the Feb 28th lows…

A key driver of the positive skew has been the constructive macro backdrop heading into the conflict, including rising global net liquidity.

Global liquidity on an 80-day forward basis increased by 3%. Typically, we see a 7–12× elasticity effect on crypto valuations. Crypto has performed +19%.

Cross-Asset Ratios

ETH/BTC has rallied +2.53% off the Feb 28th lows — also showing an ascending range (positive skew). Capital is rotating down the risk continuum…

Altcoin market index has rallied +10.9% off the Feb 28th lows — also showing positive skew.

Altcoins, on a broad index basis, have underperformed BTC since the February 28 lows.

On a higher timeframe, however, this move reads as a retracement within a broader uptrend.

Crypto sentiment has recovered in line with valuation re-ratings.

Fear & Greed index has increased from 12 (extreme fear) to 46 (neutral). Despite the performance, investors remain cautious, with sentiment yet to return to greed territory.

Relative Ratios

Off the Feb lows, BTC has outperformed Gold by +33%…

…while BTC has outperformed NASDAQ by +12%. The BTC/QQQ ratio shows clear consolidation looking for its next high conviction direction.

Crypto markets have moved directionally in line with the Russell 2000 (small cap index) but outperformed +11%.

Closing Remarks

While energy markets initially reacted as expected, broader asset pricing has increasingly reflected de-escalation expectations and, more importantly, a continuation of supportive macro conditions.

Liquidity expansion, rate path repricing, and cross-asset correlations point to a market still being driven more by underlying macro forces than by event-driven fear.

That said, while growth may soften at the margin, markets remain far from pricing a full recession. Even with the rebound, positioning and sentiment suggest investors aren’t fully leaning into the move — conviction remains cautious, with little evidence of exuberance.

State of Yields

Stablecoin lending yields:

• ~4.3% on Aave (USDC) — utilisation rates for USDC markets have started to normalise from 100% to ~93% as confidence restores by prospective depositors from bad debt being covered by a collective fund.

Fixed-rate DeFi lending: yield premium in fixed markets marginally expanding from last week:

• Pendle sNUSD: 7.3% (Jun 2026)

• Pendle sUSDAi: 7% (Jun-Oct 2026 maturities)

• sUSDe: ~5.3%, slightly up from ~3.9% last week as sUSDE TVL has dropped from $3.5b to $2.1b since the 18th of April

ETH yield benchmarks:

• Lido staking: ~2.5% (no meaningful change over the last week)

About Re7

Re7 Capital is a research-driven digital asset investment firm specialising in DeFi yield and liquid alpha strategies.

Disclaimers

The content is for informational purposes only. None of the content is meant to be investment advice. Use your own discretion and independent decision regarding investments. The opinions expressed in all Re7 public research articles are the independent opinions of the authors at the time of publication and not the opinions of the affiliates of Re7.

Please see here for full disclaimers.

Stay informed about what matters in crypto. Forget the noise. Get free market-leading crypto research by subscribing to Re7 Capital’s research below:

Subscribe now

Last week, Re7 Capital advanced its institutional infrastructure through a new partnership with Zodia Custody, reflecting the growing demand for onchain fund structures meeting institutional security standards. Zodia Custody will support transparent onchain representation of investments in Re7’s BTC Yield and Market Neutral Strategies, providing secure custody infrastructure for these fund interests. Eligible clients will be able to hold them within institutional-grade cold wallets, ensuring investor capital remains protected.

This collaboration highlights the accelerating institutional adoption of onchain investment vehicles that combine robust operational rigour with uncompromising security. Read more on our blog.

Weekly Summary

We cover:

• 2026 sentiment in numbers

• How 2026 compares to previous years

• How sentiment is diverging from macro conditions

• Market update

Sentiment on Sentiment

Re7 has regularly sense-checked market sentiment over the past few months and consistently found that positioning has skewed defensively. Divergences from broader equities in Q4 and geopolitical tension in the Middle East have only reinforced this dynamic further.

This week, we analyse the Fear & Greed crypto index data more deeply to illustrate how broken sentiment really is.

The Fear & Greed Index aggregates volatility, market momentum, social media sentiment, and trading volume into a single 0–100 score measuring the emotional state of the crypto market.

2026 in Numbers

Taking a snapshot of 2026 so far, we’re already breaking records.

This year, we’ve already printed an all-time low in the index (5) - a joint record with August 2019.

We’ve also only had 1 day in greed — the only year this has happened in history.

At current pace, 2026 will have the most days in extreme fear, beating 2022’s bear market — a year defined by the Terra and FTX collapses and an aggressive rate hike cycle.

2026 vs. Other Years

Now, let’s zoom out a bit more.

We’ve had the least optimistic start of any opening quarter on record with a mean F&G reading of just 19 — 10 points lower than 2022.

We’re only in April, but 2026 has had the highest percentage of days in fear or extreme fear on record at 95%.

We can see this trend extend into April despite markets recovering +25% off their Feb 6th lows.

The year-to-date mean F&G reading up to 20th April (18) is almost half of 2022 (31). Yet unlike 2022, there is no single catastrophic event to point to. In other words, this is sustained, structural fear.

Isolating extreme fear specifically, 2026 already accounts for the 3rd- and 5th-longest sustained periods on record — and the year is only four months old.

This follows a 2025 where Q4 already showed signs of deteriorating sentiment — the 7th- and 10th-longest extreme fear streaks on record — making 2026 a continuation and acceleration of a trend that was already in motion.

Macro Context

Aside from the nominal records, what makes the current sentiment dynamic unique is the context in which it is occurring.

Historically, crypto sentiment has tracked broader economic conditions reasonably closely — periods of growth bring higher incomes, greater savings, and more capital deployment, which feeds into positive price momentum and elevated sentiment readings.

This relationship has broadly held across cycles.

What makes 2026 different is a meaningful divergence from that pattern. Despite relatively buoyant economic conditions — including stronger US ISM readings — sentiment has failed to respond.

The gap between crypto sentiment and broader economic conditions is the widest we have ever recorded — not just during periods of ISM strength, but across the entire history of both indices.

The usual transmission mechanism has broken down, suggesting the fear gripping crypto markets is being driven by something beyond the macro cycle: geopolitical stress, structural positioning, and a market that has simply lost its risk appetite.

Closing Remarks

It’s clear 2026 is not just a ‘bad patch’ but a historically anomalous, prolonged period of extreme fear.

But with sentiment this compressed and macro conditions turning on the backend, the path of least resistance for sentiment feels higher. Markets rarely stay this fearful for long before the underlying currents pull them back.

Market Update

Markets are now +25% off their Feb lows with global crypto market capitalisation now at ~$2.51T today.

Last week, BTC rose +4.3% while ETH rose +3.3%.

Recent escalatory rhetoric between Iran and the US continues to moderately whipsaw market direction. Yet, the broader market pattern have remained overall robust since the Feb lows (higher highs, higher lows).

Risk asset remaining relatively stable with volatility indices not spiking dramatically suggests that the market is pricing in low probability of sustained escalation having an impact on valuations:

• Trump will blink → too much political risk on the line to tolerate

• Institutions will contain it → back channels negotiations kick in

• We’ve seen this before → buy the dip reflexivity like Covid, April tariffs

• Backend macro conditions remain structural driver of valuations → economic growth story intact, high net US liquidity, record bank earnings

There’s an asymmetric payoff problem: if you hedge for disaster and it doesn’t materialise, you underperform; if you ignore the risk and it does, you lose—but so does everyone else.

The result is a structurally under-hedged market, reinforced by strong earnings and ongoing AI capex.

The BTC/Brent continues to echoes this thinking, exhibiting a clear three-phase progression—drawdown (A), consolidation (B), and recovery (C).

This pattern is consistent with a market that absorbs shocks without transitioning into a sustained risk-off regime.

This also aligns with the moderate Coinbase premium seen in BTC spot markets, indicating stable demand from U.S. flows and reinforcing a regime of absorption rather than systemic de-risking…

…and why crypto markets continues to bounce off support relative to the NASDAQ, despite the latter’s strong run in recent days.

State of Yields

Stablecoin lending yields:

• ~13% on Aave (USDC) — near 100% utilisation rates, which is pushing supply-side yields higher. High utilisation rates driven by significant supply pulled from markets over the weekend.

Fixed-rate DeFi lending: yield premium in fixed markets marginally expanding from last week:

• Pendle sNUSD: 8.53% (Jun 2026)

• Pendle sUSDAi: 7-8% (Jun-Oct 2026 maturities)

• sUSDe holding: ~3.9%, slightly up from ~3.5% last week

ETH yield benchmarks:

• Lido staking: ~2.6% (marginally higher over the past week)

About Re7

Re7 Capital is a research-driven digital asset investment firm specialising in DeFi yield and liquid alpha strategies.

Disclaimers

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Last week, Re7 Capital advanced its institutional infrastructure through a new partnership with Zodia Custody, reflecting the growing demand for onchain fund structures meeting institutional security standards. Zodia Custody will support transparent onchain representation of investments in Re7’s BTC Yield and Market Neutral Strategies, providing secure custody infrastructure for these fund interests. Eligible clients will be able to hold them within institutional-grade cold wallets, ensuring investor capital remains protected.

This collaboration highlights the accelerating institutional adoption of onchain investment vehicles that combine robust operational rigour with uncompromising security. Read more on our blog.

Weekly Summary

We cover:

• A re-visit to aggregation theory for the DEX sector

• Why the theory hasn’t materialised universally across ecosystems

• Market update

Aggregation Theory Meets Reality

For many years now, there has been a somewhat consensus thesis that aggregators would ultimately capture most of the value in DeFi by owning the user relationship and routing around decentralised exchanges (DEXs) by commoditising liquidity venues.

This is one form of aggregation theory.

The surface-level analogy to fintech and TradFi was compelling — in every major internet market, the layer that controlled user distribution ended up capturing disproportionate value from the layers beneath it.

Google routed around publishers, Amazon routed around brands, Facebook routed around media…

Yet, DEX aggregator volume dominance for the top two ecosystems — Ethereum and Solana — has failed to drive meaningful activity.

Aggregator share over the past 2 years has never sustained >20%.

As we often learn, the picture is always more nuanced than black or white. Not all chains are structured the same way.

DEX aggregation volume dominance on Ethereum has never meaningfully surpassed >10%. On high volatility days, aggregator volume goes down, not up.

This provides the first clue — gas costs can punish complex routing more when chain congestion increases. On higher volatility days, we can reasonably expect higher relative fees onchain including on L2s.

With this thinking, we should therefore expect reliably lower cost, low latency, and higher throughput chains to be more conducive environments for DEX aggregators.

This is because transaction costs are negligible so complex routing is cost effective where prices can update near real-time.

We see this in the data. Solana DEX aggregator volume dominance is 3x higher vs. Ethereum with its dominance increasing 2x over 3 years.

Another reason for this divergence is there is a structural need for aggregators.

Solana’s liquidity is fragmented across an increasing number of long tail of AMMs, so splitting routes across venues genuinely improves execution.

Negligible fees mean complex multi-hop routing costs the same as a single swap — sophistication is free.

On Ethereum, volume is concentrated in a handful of deep Uniswap v3 pools, so Uniswap’s own router already finds the best price in one hop. And on the rare occasions an aggregator can improve on price, Ethereum’s gas costs for multi-hop routes frequently wipe out the gain anyway.

Take key distribution channels on Ethereum like Metamask. The majority of the volume flows through Uniswap pools without the need for aggregators.

Context is Everything

So taken together, Ethereum’s liquidity structure, gas economics, and the early dominance of native DEX routing have collectively prevented aggregators from establishing the foothold the thesis predicted.

The conditions that made Jupiter indispensable on Solana — fragmented liquidity, negligible routing costs, no single dominant venue — simply don’t exist on Ethereum in the same way.

Aggregation theory may yet play out over longer timeframes or in new contexts, but for now the data suggests it is less a universal law of DeFi and more a function of chain architecture and where liquidity happens to settle.

Market Update

Crypto markets gained +2% last week despite ongoing turbulence with peace negotiations talks between the US and Israel.

Despite negotiations collapsing on the first day the re-introduction of new blockade threats over the weekend, it feels investors are now becoming fatigued with headlines.

What is becoming increasingly likely is Trump will be looking for an offramp and declare strategic success.

This is what the charts maybe sniffing out.

Crypto markets are opening positively +0.2% on Monday where we’re looking for a re-test bounce from breaking out of the wedge pattern since October 2025…

The weekly chart is even clearer. It doesn’t scream risk off…

The data so far still directionally supports the view that the recent drawdowns was primarily driven by systematic deleveraging, rather than a deterioration in underlying crypto fundamentals or macro backdrop heading into the conflict…

We’ve just seen the largest spike in US domestic liquidity. These are typically seen during periods of rising liquidity trends and rarely seen during prolonged periods of financial tightening by the Fed.

And the reason this is important is that these undercurrents are occurring as investors remain deeply skeptical, fearful, and poorly positioned for any upside volatility that could follow.

State of Yields

The yield premium has compressed to near zero — stablecoin supply more than doubled between 2024 and 2026, but borrowing demand never came in the concentrated bursts that drove rates higher in previous cycles.

In other words, DeFi yields were never a structural premium over TradFi; they are a cyclical expression of the demand for leverage.

Stablecoin lending yields:

• ~2.26% on Aave (USDC), still below the ~3.7% 3-month T-bill rate. Variable-rate premiums remain compressed.

Fixed-rate DeFi lending: yield premium in fixed markets marginally expanding from last week:

• Pendle sNUSD: 8.46% (Jun 2026)

• Pendle sUSDAi: 7-8% (Jun-Oct 2026 maturities)

• sUSDe holding: ~3.6%, slightly up from ~3.5% last week

ETH yield benchmarks:

• Lido staking: ~2.36% (flat over the past week)

About Re7

Re7 Capital is a research-driven digital asset investment firm specialising in DeFi yield and liquid alpha strategies.

Disclaimers

The content is for informational purposes only. None of the content is meant to be investment advice. Use your own discretion and independent decision regarding investments. The opinions expressed in all Re7 public research articles are the independent opinions of the authors at the time of publication and not the opinions of the affiliates of Re7.

Please see here for full disclaimers.

Stay informed about what matters in crypto. Forget the noise. Get free market-leading crypto research by subscribing to Re7 Capital’s research below:

Subscribe now

Last week, Momentum around Telegram’s in-app wallet continues to accelerate, as more users discover the ease of earning passive yield on their USDT holdings directly within the app. Powered by Re7 Labs, yields of up to 18% remain available, fuelling the next wave of mainstream adoption by pairing one-tap access with institutional-grade yield strategies.

Weekly Summary

We cover:

• The rate of perpetual volume growth vs. spot

• The rate of DEX volume growth vs. CEXs

• Perp DEX market shares

• Why perp DEXs are winning

• State of the Yields

State of Play: Perpetuals

Perpetual Momentum vs. Spot

Crypto derivatives have always been the tail that wags the dog. Perps in particular — perpetual futures with no expiry, funding rates that keep them anchored to spot — became the dominant trading instrument almost by accident.

They stayed that way because they suited how crypto traders actually operate: high leverage, fast in and out, no rolling costs.

Perp/spot monthly volume ratio is at all-time-high where perp volume is 4.6x that of spot ($3.5T+).

For years, that market was effectively Binance. Now we’re seeing a structural shift towards minimally extractive platforms where traders prefer to express their strategies for a variety of reasons:

• Fee competition — DEX venues are structurally cheaper and don’t carry the operational overhead that puts a floor under incumbent pricing

• Uptime and resilience — October 2024 made the reliability gap visible. Traders who moved to venues that stayed operational during the volatility largely stayed there

• Cross-margin and composability — on-chain venues now support cross-margin collateral and integrate natively with the broader DeFi stack, giving sophisticated traders capital efficiency that CEXs can’t replicate structurally

• UX parity — the friction argument for staying on a CEX has largely gone. On-chain execution has caught up to the point where UX is no longer a meaningful barrier for the traders that matter most to volume

• Broader competitive pressure — faster listings and aggressive fees from mid-tier CEXs, plus expanding institutional alternatives, have eroded the incumbents’ captive flow

DEXs vs. CEXs Relative Momentum

The result is a derivatives landscape that looks meaningfully different from just 12 months ago.

Today, 20% of derivative CEX volume is now being generated on-chain, up from 8% just 12 months ago (2x).

Within the perpetual DEX landscape, Hyperliquid continues to dominate the market at ~40%. The next four largest venues are evenly distributed at ~10% market share.

There seems to be a lesson in the market share flux here.

Most attempts to compete in perps to Hyperliquid have leaned on token incentives to seed volume. The problem is that it shows, when traders rotate out of the token, the activity goes with them. Their traction hasn’t always been organic.

Binance remains the dominant CEX in perpetuals, but the gap with the leading DEX is closing fast. Twelve months ago, that venue was doing around 25% of Binance’s perp volume. It’s now at 55% — 2x in relative terms in a single year.

The most compelling part of the DEX vs CEX story isn’t the volume shift — it’s what that volume shift means as a business.

Imagine a DEX with a near-zero cost base running at roughly 99% margin on trading fees. Now compare that to the incumbent centralised venue, which carries all of those costs and operates at closer to say 50% margin.

This means DEXs can generate 2x more profit per unit of volume than their centralised counterparts.

Blended fee rates could reasonably be 0.03% for a market leading DEX vs. 0.035% for Binance.

The chart below plots two lines against Binance: a volume ratio, and an implied profit ratio. The gap between them is the structural point.

The DEX doesn’t need to match Binance volume-for-volume to generate comparable profit — the margin differential does the work.

Every percentage point of volume share it gains translates into roughly double that in profit share. As the volume gap closes, the profit gap closes faster.

And crucially, that profit doesn’t disappear into a corporate cost structure — it gets recycled back into the protocol, whether through token buybacks, liquidity incentives, or product development, creating a compounding flywheel that makes the platform progressively harder to compete with.

Market Update

Markets are either seeing past and discounting the constant aggressive rhetoric by Trump and/or pricing in a greater likelihood of resolution in the Middle East.

BTC is looking to re-gain $70k and is up +10.7% from the conflict start lows in late February.

There continues to be signal in the BTC/Brent ratio.

The ratio has not broken down (in fact rallying off 620 lows again), suggesting the market is so far treating this as a geopolitical supply shock rather than a risk-off macro event.

If anything, the resilience of BTC against a commodity that is directly pricing in the conflict is a signal worth watching.

If the geopolitical premium starts fading from oil, this is where we may see long duration assets like BTC etc catching stronger bids.

At the same time, US domestic liquidity conditions continue to improve as the business cycle progresses. Against that backdrop, total altcoin market capitalisation is currently holding at a key support level — being buoyed by liquidity undercurrents.

Tokenised real-world asset value has surpassed $28B where the most consistent growth in the last month has been from US treasury debt.

One key driver has been Circle’s USYC tokenised money market fund with its AUM up 60% YTD.

State of the Yields

Stablecoin lending yields:

• ~2% on Aave (USDC), still below the ~3.6% 3-month T-bill rate. Variable-rate premiums remain compressed.

Fixed-rate DeFi lending: yield premium in fixed markets marginally expanding from last week:

• Pendle sNUSD: 8.4% (Jun 2026)

• Pendle sUSDAi: 6-8% (Jun-Oct 2026 maturities)

• sUSDe holding: ~3.5%, down from ~4.7% last week

ETH yield benchmarks:

• Lido staking: ~2.37% (flat over the past week)

About Re7

Re7 Capital is a research-driven digital asset investment firm specialising in DeFi yield and liquid alpha strategies.

Disclaimers

The content is for informational purposes only. None of the content is meant to be investment advice. Use your own discretion and independent decision regarding investments. The opinions expressed in all Re7 public research articles are the independent opinions of the authors at the time of publication and not the opinions of the affiliates of Re7.

Please see here for full disclaimers.

Stay informed about what matters in crypto. Forget the noise. Get free market-leading crypto research by subscribing to Re7 Capital’s research below:

Subscribe now

Last week, Momentum continues to build around Telegram’s in-app wallet, where users have now been earning yield on USDT holdings for several weeks. Opportunities of up to 18% powered by Re7 Labs are driving the next phase of mainstream crypto adoption, combining simple access with institutional-grade yield strategies.

Re7 Capital also continues to gain recognition across the industry awards circuit. The firm is shortlisted for Risk-Adjusted Returns of the Year at the Hedgeweek® European Awards 2026, underscoring our focus on consistent, risk-aware performance across both digital assets and traditional markets. Re7 is also recognised across six categories at the Hedgeweek® Global Digital Assets Awards, including Discretionary Fund, Market Neutral Fund, and Multi-Strategy Fund.

Weekly Summary

We cover:

• How Lending sector generates revenue

• Double clicking on AAVE as a case study

• The three variables that drive revenue

• Why the current macro cycle is a tailwind for all three

• Market update

DeFi Growth Through a Macro Lens

Sector-Level Divergences

We’ve highlighted before the divergence between fundamentals and valuations across various sectors, including Lending.

For example, today, we’re seeing the largest divergence between sector-wide active loans and fully-diluted valuations.

If we look at specific example within Lending such as AAVE, its revenue and upside potential is contingent a variety of mechanisms which respond differently to where we are in the broader market cycle.

How Aave makes money

Aave’s revenue is essentially a function of three things: borrow volume, the prevailing interest rate environment, and the share of interest that accrues to the protocol treasury. In a higher-yield, wider-spread environment, all three move up simultaneously.

In a tightening cycle, the reverse is true — as we saw clearly when the Fed hiked aggressively from 2022, Aave’s active loan volume fell sharply, and has only recently begun to recover as rates have come off their peak.

Why the Current Environment is Interesting

Three variables do most of the heavy lifting in driving Aave’s revenue:

• Borrow volume: the primary revenue driver. Historically, the bulk of active loan growth has occurred after ISM crosses 50 — a threshold we have recently passed. 93% of last cycle’s loan growth came after that point.

• Borrow rates: currently averaging around 3.5% blended across markets. At prior cycle peaks, blended rates reached 10–15% — a difference that flows directly into protocol revenue.

• Valuation multiple: Aave currently trades at around 20x price-to-revenue. At prior cycle peaks, that multiple has exceeded 40x as risk appetite and confidence in forward earnings increases.

In a conservative scenario, where only borrow volume recovers, the revenue impact is meaningful on its own. In a more constructive environment — where all three variables move together — the combined effect has historically been a factor of 10x or more from trough to peak.

Broader Implications

DeFi applications can have clear and measurable revenue models that are directly leveraged to the macro and credit cycle conditions that appear to be turning. This thinking extends beyond lending — protocols sitting at the centre of on-chain credit, trading, and derivatives activity all stand to benefit as borrow demand, volumes, and risk appetite return.

Market Update

Global market capitalisation has been finding good support at $2.25T where the market has been unable to sustain a breakdown in technicals since the Middle East conflict began.

For BTC, we’ve seen 5 weeks of weekly closes >$65k.

So far, this week appears to be no different (+2%). Contrary to many expectations, BTC is finding some stability at these mid-60 levels despite ongoing headlines of escalation including ground troop operations by the US.

The BTC/Gold and Crypto/QQQ ratios, which bottomed on the weekend when the conflict started, are up +18% and +10%, respectively.

BTC/Brent Crude ratio has been finding support at ~620 over the past 2 weeks.

BTC’s wick to <$65k late Sunday drove the ratio to briefly dip below this level before strongly re-bounding back above this support in <1 hour.

Either a sustained break below these levels would signal the market placing further pressure on long duration assets, or the lows are in and the risk/macro backdrop begins to stabilise.

What feels more clear is market conviction will continue to turn quickly — geopolitical developments, macro data, or a shift in liquidity conditions can reprice risk assets sharply in either direction and volatility will remain elevated.

State of the Yields

Stablecoin lending yields:

• ~2.18% on Aave (USDC), still below the ~3.7% 3-month T-bill rate. Variable-rate premiums remain compressed.

Fixed-rate DeFi lending: yield premium in fixed markets marginally expanding from last week:

• Pendle sNUSD: 8.9% (Jun 2026)

• Pendle sUSDAi: 7.4% (Jun-Oct 2026 maturities)

• Pendle stUSDS: 5.7% (Jun 2026)

• sUSDe holding: ~4.7%, up from ~3.5% last week

ETH yield benchmarks:

• Lido staking: ~2.38% (down from 2.5%)

About Re7

Re7 Capital is a research-driven digital asset investment firm specialising in DeFi yield and liquid alpha strategies.

Disclaimers

The content is for informational purposes only. None of the content is meant to be investment advice. Use your own discretion and independent decision regarding investments. The opinions expressed in all Re7 public research articles are the independent opinions of the authors at the time of publication and not the opinions of the affiliates of Re7.

Please see here for full disclaimers.