“A recent report finds crypto lenders overseeing nearly $60 billion in assets, driven by renewed interest in decentralized finance.”

DeFi Grows Up: From Speculation to Infrastructure as Institutions and Real-World Assets Enter the Scene

Decentralized finance (DeFi) is leaving its purely speculative past behind and evolving into critical financial infrastructure, according to a new report from blockchain analytics firm Artemis and on-chain yield aggregator Vaults.fyi.

While previous DeFi growth was fueled largely by high-yield promises and speculative fervor, the latest wave is characterized by institutional involvement and integration into everyday financial products, the report said.

DeFi Lending TVL Approaches $60 Billion

Lending platforms like Aave, Euler, Spark, and Morpho have collectively pushed DeFi’s total value locked (TVL) past $50 billion, with figures approaching $60 billion—a surge of 60% over the past year. The increase underscores the maturing ecosystem and the adoption of sophisticated risk management strategies.

“These protocols are transitioning from simple yield tools into modular networks that institutions can confidently build on,” the report stated.

The Rise of the “DeFi Mullet”

A notable trend highlighted in the report is the so-called “DeFi mullet.” In this model, consumer-facing apps offer smooth, familiar user experiences while leveraging DeFi infrastructure on the backend.

Coinbase, for example, allows users to borrow against their bitcoin holdings through DeFi protocol Morpho. As of this month, this has facilitated over $300 million in loans.

Bitget Wallet users can earn 5% yields on USDC and USDT thanks to an integration with Aave, without needing to navigate complex DeFi processes. Even traditional players like PayPal have entered the yield space, offering around 3.7% on its PYUSD stablecoin to users on PayPal and Venmo, though without direct DeFi integration.

The report suggests that fintech giants such as Robinhood and Revolut could soon integrate DeFi solutions to roll out features like stablecoin credit lines or asset-backed loans, unlocking new revenue channels.

Tokenized RWAs Enter DeFi Markets

DeFi protocols are increasingly exploring tokenized real-world assets (RWAs), such as tokenized U.S. Treasuries and private credit funds. These assets can act as collateral, provide yield opportunities, and serve as building blocks for advanced financial strategies.

Tokenizing investment strategies is also gaining steam. Pendle, a protocol enabling users to split the yield from the principal of their crypto assets, now boasts over $4 billion in TVL, much of it linked to tokenized stablecoin yields.

Emerging yield-bearing tokens like Ethena’s sUSDe are attracting attention with yields north of 8%, driven by strategies like cash-and-carry trades that shield users from operational complexities.

Crypto-Native Asset Managers Step In

Another significant shift is the rise of on-chain asset managers such as Gauntlet, Re7, and Steakhouse Financial. These firms allocate capital across the DeFi ecosystem using professional strategies reminiscent of traditional asset management while actively participating in protocol governance and risk optimization.

Since the start of the year, assets managed by crypto-native firms have grown fourfold, climbing from $1 billion to over $4 billion, the report said.

Altogether, the findings point to a DeFi sector that is becoming less about speculative trading and more about solidifying its place as a backbone for modern finance—with real-world assets, institutional players, and advanced on-chain products at its core.

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