The latest security breaches have shaken the crypto area and highlighted the fact that security will continue to have to be a key focus of providers.

In today’s edition, Marcin Kaźmierczak breaks from Redstone Oracles, which is why 2025 will be a critical year for Defi and On-Chain Finance.

Then Kevin Tam looks at the institutional adoption of Bitcoin, from the recent 13-F archives and highlights key positions in ASK and Expert.

AndSarah Morton

You read Crypto for advisers, Coindesk’s weekly newsletter that unpacks digital assets for financial advisers. Subscribe here to get it every Thursday.

Defi Renaissance -why 2025 will be the year of decentralized and on -chain -financing?

The recent Hack of Bybit for nearly 401,000 ETH, valued at around $ 1.5 billion at that time, exposed that security will play a huge role in further crypto recording. Can institutions extend on-chain after such an event? Undoubtedly. It is a matter of gradual adoption along with ensuring top-notch security procedures.

Growing adoption of dividend -bearing assets: stacking, floating efforts, residual belt and fluid recovery

In traditional funding, dividend-generating assets are typically seen as stronger long-term investments than non-productive activities, as they provide investors with continuous cash flow and income. This perspective helps to explain why some investors prefer ether over Bitcoin. Ether is seen as more “productive” because it drives a network that supports a wide range of decentralized applications that benefit from networking effects. In addition, Ether Stakes can earn uniform benefits and adapt well with traditional valuation methods that prioritize continuous yield. The growing interest in efforts, especially in the context of yield-generating assets, is evident in the growth of fluid stacking, which enables friction-free and capital-efficient stacking. This trend further accelerated in 2024 with the emergence of fluid restriving – for example, ether.Fi, a leading fluid residue platform, then explosive growth last year with over $ 8 billion worth of ether that was put through its rails.

Source: Defi Llama, Total Value Locked In Ether.fi

The total amount of stack ether is expected to grow and play a significant role in defi. About a third of all eth or $ 90 billion is attached, with further influx expected from traditional financial institutions exploring efforts. As the effort becomes more accessible through fintech applications, some investors may transition from custody to non-parenting authority when they gain a deeper understanding of blockchain technology.

StableCOin growth

The global demand for exposure to US dollar is huge and stablecoins are the most effective way to accommodate it. StableCOins like USDC extends access to dollar-denominated wealth and streamlin value exchange. By 2024, venture capital investments have flowed into stableecoin projects, and we expect further development in this space. Regulatory framework such as the EU’s Mica has provided more explicit guidelines, further legitimizing stablecoins and probably drives higher adoption next year. In addition, stableecoins are integrated into traditional financial systems. For example, Visa has started using USDC on networks like Solana to facilitate faster and more efficient payments. In addition, PayPal entered the market with PUSD, and Stripe made one of Crypto’s most significant acquisitions by buying bridge to expand its stablecoin operations. By 2024, the total stablecoin market capitalization reached a highlight at all times, over $ 200 billion and continued to set new items in 2025.

Source: Defi Llama, Total Stablecoins Market Cap

Improved interoperability and user-friendly non-parenting solutions

An important challenge in DEFI is to move funds across networks to access different investments. By 2025, considerable progress is expected to remove the need to bridge the gap between funds by introducing a “one-click solution.” This development should simplify the process of new Defi users and probably attract more participants to space. In addition, wallets are expected to improve the security of on-chain funding and streamline onboarding process by eliminating cumbersome crypto-native setups. This shift, driven by innovations such as Account Abstraction Movement, aims to make Krypto more accessible and user -friendly to access the chain financing. Currently, the irreversible nature of transactions and the spread of sophisticated scams discourages many new users. However, improved security functions should encourage several individuals to engage in decentralized financing.

Bitcoin reaches $ 100,000

Although it is not inherent to keep Bitcoin on its original network not inherent associated with financing on the chain, we witness a growing integration of Bitcoin with decentralized economic ecosystems. E.g. Is approx. 0.5% of Bitcoin’s total supply through the stack protocol Babylon now locked to secure Proof-of-Stake (POS) chains. The increased acceptance of Bitcoin from large banks and some governments is expected to create run -down effects, which changes the public’s perception of digital currencies away from being seen as a speculative asset or illegal activities to be a legitimate financial instrument, bringing new users to the chain.

-Marcin Kaźmierczak, COO, Redstone Oracles

Ask an expert

Question: Can banks keep crypto with SEC’s SAB 122?

ONE: SECS Personnel Accounting Bulletin 122 can encourage banks to integrate digital assets into the regulated financial system. By opening competition, banks can compete with centralized exchanges. Banks can offer services such as Bitcoin-supported lending, efforts and depotting services that treat digital assets more like traditional assets.

This is a positive step into a more flexible legislative approach and balancing of investor protection with the operational realities of financial institutions.

From institutional investments to mainstream recognition, this is another major shift in how the world looks and interacts with digital assets.

Question: What institutions (eg sovereign wealth funds, pensions, companies, etc.) buy Bitcoin?

ONE: The accumulation of sovereign wealth funds and pension funds is just getting started.

Mubadala Investment Company PJSC (Wealth Fund, owned by the Government in Abu Dhabi), owns $ 436 million in a Bitcoin ETF with the total assets under the management of $ 302 billion. Abu Dhabis Søvereign Wealth Fund (AIDA) administers a total of $ 1.7 trillion, indicating that their Bitcoin investment is a relatively small part of the overall portfolio.

In addition, Mubadala offered this last fall to acquire the Canadian capital management company CI Financial Corp. for $ 4.6 billion.

In the United States, the state of Wisconsin Investment Board’s latest report shows that its Bitcoin ETF holdings have more than doubled from the last quarter to over $ 321 million.

Question: Bank on Bitcoin – which Canadian bank does the charge?

ONE: The latest Q4 2024 SEC archives reveal that Canadian Schedule 1 banks, institutional money managers, pension funds and sovereign wealth funds have revealed significant bitcoin stocks (see diagrams).

In particular, the Bank of Montreal now tops Canadian banks with $ 139 million in Spot Bitcoin ETF investments. And BMOS Bitcoin Holdings went from zero to over $ 100 million in a single year.

Currently, in North America, there are approximately 1,623 large units holding over $ 25.8 billion in Bitcoin ETPs.

AndKevin Tam, Digital Active Research Specialist

Continue to read

• Citadel announced plans to offer crypto trade and liquidity.
• Are you curious about Bybit Hack? Stephen Sargeant created a LinkedIn post that summarized some of the recovery efforts that are underway with the support of the Crypto Community.
• Coinbase announced last week that SEC would drop its lawsuit against the exchange.