Bitcoin (BTC) took the focus of the rest of the cryptography market in 2024, but the Trump administration is quickly changing the rules of the game and a rotation in other assets could end up happening, according to the Kaiko Research Cryptography data firm
In fact, the Decentralized Finance Sector (Defi) does not look so bad, wrote Kaiko Adam McCarthy and Desslava Aubert’s research analysts in a new report.
The company’s defi index (KSDEFI) has surpassed Ethher (ETH) since the beginning of the instrument in October 2023, with approximately 75% yield in that period of time. That is notable considering that most protocols included in the index are based on Ethereum.
“This higher performance can persist in the second half of 2025, since several assets within the index benefit from strong tail winds,” the report said. “This trend highlights the decreasing correlation between the Defi and ETH index over time, since the decentralized financial sector continues to expand beyond the Ethereum ecosystem.”
The index consists of 11 tokens defi, the heaviest is UNI, Aave and Oncdo. At least four of these tokens have powerful tail winds for the rest of the year, according to the report.
For example, regulatory developments in the USA can open possibilities for Uniswap decentralized exchange and the decentralized lender AAVE to implement fees switches for each of their respective tokens, which means that protocol rates can end up distributed to the holders of the UNI and AVE.
Ondo Finance tokenization protocol, meanwhile, will probably benefit from an acceleration of the tokenization tendency, since Wall Street continues to vain more deeply in cryptography, according to the report.
“Regulatory restrictions in key markets have been a significant obstacle [since 2020]But they are just part of the challenge. Defi has also faced structural problems, including the high friction of the user due to safety rates and concerns. However, with the decrease in regulatory scrutiny, the sector now has abundant growth opportunities, ”said the report.
