Bitcoin News Today: DeFi Embraces Institutional Investors Amid $24 Billion RWA Surge

DeFi is at a crossroads, facing both opportunity and scrutiny as institutional investors — often referred to as “suitcoiners” — increasingly enter the space. Kevin Rusher, founder of RAAC, argues that rather than fearing these newcomers, DeFi should embrace their role in stabilizing and legitimizing the industry. The original ethos of cryptocurrency — built on decentralization and distrust of traditional finance — still holds, but the landscape has evolved significantly over the past 15 years. Today, major asset managers and institutions have a stake in crypto, and BlackRock, for instance, holds the second-largest Bitcoin (BTC) position after Satoshi Nakamoto [1].

Despite this growing institutional interest, trust in crypto remains low. Recent data indicates that 38% of non-crypto holders refuse to invest due to volatility and inaccessibility. In the U.S., crypto adoption has dipped to 28%, down from 33% in 2022, following the collapse of Terra, which erased $60 billion in market value overnight. As a result, 63% of Americans do not trust current crypto investment products [1].

DeFi, in particular, struggles with a lack of trust. The sector is often perceived as a high-risk, speculative environment due to memecoin scams, unstable hype cycles, and frequent hacks. However, institutional involvement is beginning to bring structure and liquidity. A key area of growth is tokenized real-world assets (RWAs), which have surged past $24 billion in market capitalization, up from $11.5 billion in June 2024. Private credit leads the RWA market with a 58% share, followed by tokenized U.S. Treasurys at 34% [1].

This growth is not driven by hype or influencer culture but by the appeal of DeFi’s open infrastructure and liquidity. Institutional investors are using DeFi to access new financial tools, embedding yield into fintech apps, exchanges, and wallets. Protocols like Morpho, Spark, and Aave are making DeFi more accessible and user-friendly. In June 2025 alone, collateralized lending platforms surpassed $50 billion in total value locked (TVL) [1].

Coinbase’s credit business is another example of how DeFi is being integrated into traditional financial systems. The platform has issued over $300 million in BTC-backed loans, often without users realizing blockchain’s involvement. These developments highlight DeFi’s potential to serve as a backend for institutional finance while maintaining its core values [1].

DeFi is now meeting the compliance and performance standards that institutions require. With clearer regulatory frameworks and evolving policy, the sector can build a bridge between traditional finance and decentralized systems. However, Rusher cautions that if institutions adopt blockchain through centralized and permissioned systems, it would merely replicate traditional finance under a new name. The key is to ensure that DeFi remains decentralized while being open to collaboration and growth [1].

By embracing institutional involvement, DeFi can move toward a more stable and sustainable future. This does not mean abandoning its principles but rather adapting to new realities while staying true to its origins. If welcoming suitcoiners means building a resilient financial system that avoids the pitfalls of speculative cycles, then the shift is well worth the effort [1].

Source: [1] DeFi shouldn’t fear ‘suitcoiners’ (https://cointelegraph.com/news/defi-shouldn-t-fear-suitcoiners?utm_source=rss_feed&utm_medium=rss&utm_campaign=rss_partner_inbound)