AaveDAO Founder Kulechov: The Rise of RWA Will Lead DeFi in 2025, While Meme Coins Cool Down and Institutional Involvement Drives Capital Flow Back

03/10/202503/11/2025

Aave DAO founder Stani Kulechov stated during an interview on March 10 that DeFi began to gain momentum in 2020. However, as market attention shifted towards meme coins, NFTs, and other speculative assets, many people felt that DeFi was gradually becoming boring. In reality, DeFi continues to develop robustly.

Kulechov pointed out that Aave, as a leading player in DeFi lending, has a total locked value of up to $35 billion in 2024, occupying 45% of the DeFi lending market, with annual revenue surpassing $100 million. This demonstrates that while DeFi may not generate as much hype as meme coins, it has already become a genuine financial infrastructure capable of generating returns.

DeFi is Not Boring; Rather, It is Maturing

Kulechov believes that the perception of DeFi as “boring” stems from its reliability, stability, and practicality, in contrast to the past, which was marked by risks and high volatility. He stated, “I would prefer a boring system that operates steadily rather than a market full of excitement that is prone to collapse.”

Over the past few years, the crypto market has experienced significant events such as the FTX collapse, cross-chain bridge attacks, and smart contract vulnerabilities. In contrast, Aave and other mainstream DeFi protocols have remained unscathed, indicating that mature DeFi platforms are now capable of withstanding market volatility and risks.

Retail and Institutional Capital: The Main Users of DeFi

Kulechov mentioned that the current DeFi user base consists of two main groups:

General Users: Individuals using DeFi to earn yields, stake assets (ETH & BTC) to borrow, or engage in financial operations, such as using it as a down payment for a mortgage or purchasing a car.
Institutional Investors: Large institutions and asset management firms have also begun to focus on DeFi, such as tokenizing assets and leveraging the lending and yield opportunities provided by DeFi.

Kulechov pointed out that as financial institutions gradually adapt to decentralized finance, DeFi is expected to become an independent financial system that complements traditional finance rather than completely replacing the existing financial system.

RWA Will Be Key to DeFi in 2025

One of the main development directions for DeFi in 2025 is to bring real-world assets (RWA) onto the blockchain, including:

Treasury Bills: Many stablecoins have already taken the “tokenized” form of Treasury bills, and in the future, DeFi could further expand into a broader range of fixed-income assets.
Stocks and Private Equity: Many private companies find it difficult to access global investments, and tokenization can allow more people to participate in venture investments.
Real Estate and Commodities: Digitizing assets such as real estate and gold to enhance trading liquidity.

Kulechov revealed that Aave has already begun collaborating with institutions to provide lending services for these tokenized assets. In the future, DeFi might not just be a financial system for cryptocurrencies but could become one of the infrastructures of the global financial market.

DeFi Expected to Become a Global Financial Standard in the Next Decade

Kulechov predicts that within the next 30 to 40 years, the global financial system will gradually move onto the blockchain. However, this transition is not just a technological advancement; it also involves conflicts of interest among traditional financial institutions like banks, payment systems, and settlement agencies. These financial giants are unlikely to relinquish market dominance easily.

However, financial giants like BlackRock and JP Morgan have already begun testing DeFi technologies, indicating that traditional finance is no longer resistant to DeFi but is seeking integration with it. Kulechov believes that the core values of DeFi lie in transparency, auditability, and censorship resistance, and these characteristics will become the standards of future financial systems.

The Decline of the Meme Coin Frenzy and Institutional Entry: An Opportunity for Capital to Flow Back to DeFi

Recently, the market has been dominated by a frenzy of meme coins, from Donald Trump’s TRUMP coin to Argentine President Milei’s LIBRA and various altcoins, leading to a massive influx of capital into these highly speculative assets. However, Kulechov bluntly stated, “99% of people in the meme coin market are losing money, which will only lead to more users losing confidence in cryptocurrencies.”

In contrast, the yields offered by DeFi are more stable and the risks more controllable. As the meme coin frenzy wanes and institutional investors begin to enter the market, capital may gradually flow back to DeFi.

Risk Warning

Investing in cryptocurrencies involves a high degree of risk, as their prices can be highly volatile, and you may lose all your principal. Please assess the risks carefully.