The New DeFi Era Has Arrived: RWAFi and Stablecoin Payments Become New Opportunities

Since the DeFi Summer of 2020, AMM, lending protocols, derivatives trading, and stablecoins have become the core infrastructure of the cryptocurrency trading field. After four years of development, these sectors have gradually matured, and growth has reached a ceiling.

After the 2024 U.S. elections, the compliance process in the crypto industry accelerates, bringing new opportunities to the sector. The integration of traditional finance and DeFi is speeding up: physical assets ( RWA ) evolve from simple tokenization to yield-bearing stablecoins, becoming a new growth engine for DeFi. At the same time, stablecoins' strategic position in international trade is enhanced, and payment infrastructure continues to thrive. Traditional financial giants are accelerating their布局, injecting more possibilities into the industry.

A new batch of unicorns in the cryptocurrency trading sector is brewing. They will adapt to regulatory changes, leverage traditional financial integration and technological innovation to explore new markets, and propel the industry into the "new Decentralized Finance" era. New entrants should focus on building groundbreaking products that meet the new environment and demands.

Changes in the trading environment of this cycle

stablecoin compliance passed, cross-border payment adoption rate increased

The two parties in the United States have reached a consensus on stablecoin legislation and are expected to introduce the first comprehensive cryptocurrency bill. This will promote traditional institutions' extensive engagement with cryptocurrency wallets, stablecoins, and blockchain payment channels. In the coming years, stablecoin payments are expected to become widespread, marking another "leap forward" following Bitcoin ETFs.

Currently, stablecoin trading accounts for over 50% of blockchain transactions, with rapid growth particularly in emerging markets. Innovative payment platforms like Zarpay and MentoLabs are promoting the adoption of stablecoins through localized strategies. Stablecoins are expected to penetrate and disrupt the traditional cross-border payment market, becoming an important force in the global payment landscape.

is expected to see a relaxation of regulations on perpetual contract trading.

With Trump's complete victory in the election, the compliance process in the crypto industry is expected to accelerate, and PerpDEX is likely to welcome a spring of development. The Commodity Futures Trading Commission (CFTC) is expected to replace the Securities and Exchange Commission (SEC) as the main regulator. The CFTC's attitude towards PerpDEX is more friendly, and these positive signals may open new market opportunities for PerpDEX.

The stablecoin yield value of RWA has been discovered.

During the past bear market cycle, the RWA market grew against the trend, with the locked value of ( TVL ) rising from under a million dollars to the hundred billion dollar level. RWA not only enhances portfolio diversification but also provides a solid foundation for financial derivatives, helping investors hedge risks.

After the collapse of Three Arrows Capital, the cryptocurrency industry exposed the problem of a lack of sustainable income scenarios for assets. However, RWA(, like the yield of US Treasuries ), is steadily rising, attracting market attention. In the context of dwindling on-chain yields, the industry is turning to RWA, hoping to reinvigorate market activity by introducing off-chain stable income.

Licensed institutions on-chain expand market scale

BlackRock has launched the first tokenized fund for U.S. Treasuries issued on a public blockchain, providing qualified investors with the opportunity to earn returns through U.S. Treasuries. Wyoming plans to issue a stablecoin pegged to the U.S. dollar in 2025. State Street and JPMorgan are also accelerating their blockchain business expansion.

Opportunities and Challenges

Private Credit RWA Enters the Payfi Era, How to Solve Default Issues

The total amount of private credit is currently about 13.5 billion USD, with an average annual interest rate of 9.46%. Projects such as Figure Markets, Centrifuge, Maple Finance, and Goldfinch emerged in the last cycle but face default risks.

The "Payfi" concept proposed by Solana expands the application scenarios of private credit to cross-border financing, lending, and cross-border payment swaps. Huma Finance focuses on providing financial services for investors and borrowers, while its subsidiary Arf specializes in cross-border payment advance services, providing rapid capital flow support for payment companies by abstracting advance services through the introduction of stablecoins.

How will the leading yield stablecoin be classified ###

This cycle may see stablecoins that are safe like USDT/USDC and provide at least 5% sustainable returns. Currently, stablecoins built on government bonds as underlying assets are becoming a new trend, such as Ondo Finance's USDY, OpenTrade's Vault product, and Usual Protocol's USD0.

Another type of yield-bearing stablecoin utilizes characteristics such as market volatility and MEV to arbitrage and obtain low-risk returns, such as Ethena's USDe. Other projects like CapLabs and Reservoir are also exploring different strategies.

RWA assets and DeFi applications support each other

RWA assets enhance the stability of DeFi applications, such as Ethena's USDtb investing in BlackRock's tokenized treasury fund BUIDL. CDP stablecoins also improve collateral and liquidation mechanisms by introducing RWA assets.

The DeFi mechanism enhances the utilization efficiency of RWA token assets, such as the RWA partition launched by Pendle, which covers various yield-generating assets. Maple's Syrup project also relies on DeFi strategies for rapid growth.

Can the RWAFI public chain empower institutional finance?

Plume and Avalanche, among other public chains, are dedicated to integrating traditional finance ( TradFi ) with decentralized finance ( DeFi ), providing institutions with RWAfi solutions. Plume adopts a modular, permissionless compliance architecture that supports various functions. Avalanche helps institutions deploy customized blockchains optimized for specific use cases through its subnet architecture and collaborates with several financial institutions to promote RWA development.

A New Direction Worth Looking Forward To

1. On-chain Forex: Achieve cost-effectiveness and transparency through real-time oracles and DEX, simplifying corporate financial management.

2. Cross-border payment stack: It includes three levels: merchant layer, stablecoin integration, and foreign exchange liquidity. Building a defensible and scalable moat is key to maximizing business opportunities across all levels.

3. Multi-Pool Model Stablecoin Aggregation Platform: Such as Numéraire on Solana, which achieves seamless creation and exchange between different stablecoins through the AMM mechanism, addressing the fragmentation problem of stablecoins.

4. As the issuance scale of stablecoins on other public chains expands, similar multi-pool model products are expected to appear in more blockchain ecosystems, driving the scale and maturity of the stablecoin market.