25th March 2026 > > DeFi & vaults.

tl;dr

The movement of TradFi on chain is unstoppable creating ever more opportunities.

Market Snap

Market Wrap

Trump’s increasingly mixed messages are making life difficult for all investors.

Curious Cryptos’ Commentary – Let’s talk vaults

Two of the most important changes that are already being adopted by TradFi are tokenisation of all assets, and the stablecoin revolution, which itself is probably better viewed as the tokenisation of fiat. For those who need reminding, fiat is the third person singular passive present subjunctive of fio, fieri, factus sum, the passive counterpart to facio, facere, feci, factum, and is most accurately translated as “Let it be made”. There is no better description of the lack of substance inherent in dirty fiat currencies than that simple yet devastating description.

Once the rules and regulations are all in place, with global standards set by both the US and the EU, the transfer of near 100% of all financial assets and transactions to being on chain will start in earnest, democratising access to the financial world and materially lowering industry’s cost of capital helping to mitigate the productivity destroying culture practised by all governments.

As the process of moving on chain ramps up, you will likely hear a lot more about the concept of vaults, so now is a good time to begin to understand them better.

…

Morpho is an on chain DeFi platform. Investors deposit assets into a vault which has pre-determined and transparent investment guidelines, policies, and procedures. All activity is on chain and therefore accurately and immutably recorded for investors to see. A world where there is no risk of another Bernie Madoff is a better world.

Perhaps an easier way to understand how vaults work is to compare them to ETFs. Indeed, Bitwise has dubbed vaults as “ETF 2.0” and that is an accurate description of their role in the burgeoning world of on chain finance.

On chain vaults have other advantages over TradFi products. The rules cannot be changed giving investors certainty over the fund’s future activities, whilst leverage in most instances will be zero or at worst very minimal. As the CCC is constantly reminding everyone, leverage can be a killer and often is particularly in the crypto world. I am sure we will see vaults designed to provide investors with leveraged returns (mostly in the form of losses) but at least the existence of this leverage will be made plain for all to see.

There is a very useful site to monitor the growth of the DeFi sector which is soon to see explosive gains in activity:

https://defillama.com/rwa

I would point out two key parts of the site. First up, the size of the top DeFi protocols:

A gentle reminder that the CCC does not provide investment advice, but perhaps I might be allowed to make a few comments on the leading platforms.

Lido, EigenCloud and Binance staked ETH provide staking and re-staking services mostly focussed on ETH with a long lead time to unstake. Regular readers already know that staking rewards are often mis-characterised as being akin to interest paid on a bank account. They are not. They are merely a way of keeping your stash growing at the inherent inflation rate and thus not providing any real return at all.

Sky – well this has at its heart an algorithmic stablecoin. It will one day crash and burn. As will Ethena.

So, out of the top seven, the platforms that are of most interest are Aave and Morpho. For disclosure purposes only, AAVE has long been a core holding of the CC Treasury, a holding positioned to take advantage of the movement of TradFi on chain. Morpho is currently under review by the investment committee but has been for some time.

The second is the growth of the tokenisation of RWA, soon to look like a hockey stick:

…

Lombard has announced a new initiative in partnership with Bitwise to provide a decentralised means of enabling institutions to earn yield on their BTC holdings without transferring those holdings, nor giving up ownership. Oh, the wonders of DeFi never cease to amaze. Jacob Phillips, CEO and co-founder of Lombard, explains:

“The breakthrough is Bitcoin Smart Accounts—connecting two previously isolated worlds: institutional custody and onchain finance.”

As BTC moves to being a productive asset on the balance sheet another growth vector for institutional adoption becomes apparent.