TOKEN2049 Singapore made the shift obvious. Session names like "2026 is the Year that Fundamentals Outperformed" and "Why We Back Founders, Not Narratives" told you where this year’s event was leaning.
Across DeFi and institutional panels, speakers spent less time chasing the next hot story. More time on three older questions instead: where growth is really coming from, who is using these products and why, and whether these products can actually be built and operated in a compliant way.
Those questions aren’t new. DeFi was trying to answer them in the beginning, before one narrative cycle after another shoved them to the side. What stood out at the conference was the way people answered them now — and where narratives now rank in that pecking order.
Here, fundamentals meant real assets, real use cases, real revenue, and compliant execution. Not token price action.
Growth is coming from real assets, not a fresh narrative
Over the last year, on-chain growth has been driven more by traditional assets and actual demand than by new ideas. And the capital behind that growth looked steadier than it did in the previous cycle.
On the main stage, a16z’s Robbie Petersen said during the DeFi roundtable "DeFi's Institutional Breakthrough" that a meaningful portion of crypto’s growth over the past six to 12 months came from traditional assets moving on-chain. He pointed to Hyperliquid, where at one stage roughly half of trading was connected to RWA.
A separate Hyperliquid interview filled in the picture. Hart Lambur, co-founder of Risk Labs and moderator of that conversation, said Hyperliquid’s monthly trading volume had remained broadly flat even though crypto asset prices were clearly lower than a year earlier. The shift showed up in market structure: HIP-3 markets launched by third parties and tied mainly to real-world assets had climbed to 30% to 50% of volume, and briefly rose above half in July.
Ethena founder Guy Young offered a comparison from the funding side. During the 2022 to 2023 downturn, total stablecoin supply dropped by about 40%. In the most recent cycle, it was down only around 3% from the peak. In his words, this was the first time in a decade that capital had entered the system and stayed there.
His explanation was pretty direct. Institutional capital from outside the industry has started to see that this technology can improve cost structures or distribution efficiency. The best crypto businesses, he said, have figured out how to rely less on the cycle alone.
Institutions are asking what tokenized assets can do
The institutional question is no longer about blockchain’s upside in theory. It’s more practical now: what does the on-chain version actually add that doesn’t already exist? At the conference, the answers centered on utility, with lending showing up as the earliest use case.
At a roundtable featuring asset managers including Bitwise and Fidelity, one speaker put it bluntly: if I already have this exposure, where is the 10x benefit in holding the tokenized version? In that view, crypto exposure solves access, while tokenization solves utility. The same speaker said idle tokenized cash would next go looking for tokenized tools that can put it to work.
Pendle’s TN Lee made much the same argument from the protocol side. If tokenized assets just sit on-chain and go unused, the effect is limited. Lending comes first.
Adoption expectations were measured. Asked what share of clients might hold tokenized products in five years, Fidelity’s Cynthia Lo Bessette said 10%. Another panelist pointed to research putting the figure at about 10% by 2030. Bitwise CEO Hunter Horsley was the most upbeat, giving a range of 50% to 70%.
On 24/7 trading, the panel’s take was that people have overstated the value of trading more often and understated the value of always being available.
A sharper example came from the MEXC stage. The moderator raised a question the industry has been asking for years: if most institutional money is coming in through ETFs, what would need to happen for Wall Street to allocate directly into DeFi?
Cheryl Chan, director of strategic expansion at Kamino, said that question had it backwards. Wall Street is already entering, she said, but as borrowers, issuers, and managers. She pointed to activity on Kamino that includes institutions making home equity loans and auto loans borrowing on-chain, a listed company serving as a curator on Kamino, and a rising number of SEC-registered investment advisers entering the market.
That suggests a different kind of institutional participation. These firms are bringing their own balance sheets into DeFi. What matters to them is not ideology. It’s whether on-chain infrastructure can do a better job with borrowing, issuance, and asset management.
Execution and compliance are taking priority over vision
Builders on stage spent most of their time on execution. Simple as that. How do you turn ideas this industry has talked about for years into products people can use — and into formats institutions can actually adopt?
Hyperliquid co-founder Jeff Yan said it plainly: ideas are cheap, building is hard. Looking back over the past year, he said the most important development was that HIP-3 went from concept to reality. He also said Hyperliquid does not optimize for revenue, and that revenue is a byproduct of creating value for users.
Execution, more and more, means building on institutional terms. Hyperliquid has already launched a permissioned version of HIP-3 on testnet. Jeff Yan said permissioned markets can unlock a different category of demand without giving up the other features of on-chain finance, and that liquidity across the two market types can coexist.
Chan made the same case from the lending side. Institutions are not looking for permissionless pools, she said. They want permissioned structures, KYC, and legally enforceable bilateral arrangements. For Kamino, the focus is on lifting products to institutional standards and getting ready for compliance.
Infinex founder Kain Warwick described the shift even more bluntly. Early DeFi wanted to build a parallel financial system that was far more efficient. Now, he said, "After building it, we ended up using it to make the very system we originally wanted to replace more efficient."
That move — from trying to replace traditional finance to making it work better — is its own narrative shift. The long-term vision is still there. But attention has moved to whether products can actually be executed, and whether they can be executed within the rules institutions follow.
Narratives remain, but they are no longer the main thread
Narratives haven’t vanished. The main stage still had a memecoin roundtable, and speakers acknowledged that huge numbers of new tokens are still launching every day, spreading attention more thinly. AI agents appeared in multiple sessions, and some speakers used the main stage to introduce new networks.
The difference is that these topics no longer define the event’s central line. When institutions look at new concepts, the order now is framework first, scale later.
Cynthia Lo Bessette said the idea of bringing agents into fiduciary work at investment advisers and asset managers is being taken seriously. But the governance, operations, and risk-control frameworks are not built yet, and the topic is still in the research stage.
Back to what DeFi originally set out to do
Hart Lambur, who moderated the Hyperliquid interview, recalled that in 2018 the two things he wanted most from DeFi were open market access for everyone and a lower barrier to financial innovation. He said that vision brought many people into DeFi over the past decade, and that it is now being realized at scale.
In that sense, going back to fundamentals also means going back to what DeFi was trying to do in the first place.
The implications stretch beyond any single sector. In previous cycles, attention was scarce, and projects that captured it could dictate the agenda. The discussion at TOKEN2049 suggested that utility is scarcer now: assets that are actually being used as collateral, for borrowing, for trading, and for management, by both retail users and institutions with real balance sheets.
That kind of growth is slower. No way around it. It depends on things narratives can’t provide: legal structures, permissioned arrangements, and trust in regulated counterparties. But the article argues that this is also the kind of growth that held up during the last downturn.
Narratives will come back. They always do. What is changing is the measuring stick: where growth comes from, who is using the product and why, and whether it can be built within the rules. New ideas, new protocols, and new narratives will be judged against those questions.
This article was compiled from on-site discussions at TOKEN2049 Singapore. It does not represent the views of Kamino or any participating institution, and it is not investment advice.
