Fortunafi's State of the Industry 2Q2023 Report

A promising start to 2Q2023 struggled to hold after SEC enforcement actions led to market-wide derisking. However, a late 2Q rebound allowed market participants to turn optimistic while RWA & stablecoins secured another noteworthy quarter.

When it looked like the first half of 2023 would relieve some of the pain market participants felt in 2022, a lack of bullish catalysts, tempered volatility, thin trading volumes, and summer seasonality sent crypto plunging lower in late-2Q. The decline can largely be attributed to unprecedented enforcement actions from the SEC. While some market participants were hard-pressed to find that crypto is in the crosshairs of U.S. regulators, others had long been anticipating SEC Chairmen Gensler and others to take a stab at crypto, given recent commentary. But as the quarter approached its final innings, animal spirits were lifted on the back of Blackrock filing for a bitcoin ETF on June 15, 2023, which was followed by subsequent bitcoin ETF filing from Fidelity, WisdomTree, VanEck, ARK Invest, and Invesco.

But while post-bear market exhaustion, summer doldrums, and unfavorable regulatory actions still suppressed what many hoped would be a more explosive 2Q, Real World Assets (RWA) and stablecoins experienced a more favorable quarter. More specifically, a broader rise in RWA total value locked (TVL), a surge in demand for tokenized securities, the launch of several highly anticipated RWA-based protocols, and head-turning actions from MakerDAO, also known as “the Central Bank of DeFi,” caught the sector by storm. Meanwhile, in the world of stablecoins, a rotation out of USDC and BUSD and into USDT wasn’t enough to offset redemptions, resulting in the stablecoin market slipping to levels last seen in Oct. 2021. Despite the decline in market cap, the number of stablecoin holders rose to a new all-time high, and several market players rolled out new product offerings that seek to capture a share of the market.

When all was said and done, 2Q2023 was a mixed bag for crypto but a quarter of promise for RWA and stablecoins. The events that unfolded, coupled with the trends that have surfaced and persisted over the past year or so, have us convinced that, amongst all else, regulatory clarity will only further fuel the adoption and success of DeFi. Not only that, but after 2Q2023, we believe that the industry can expect to see further interest in RWA via governments and institutions, the crypto industry to punch back at regulators, and tokenized securities to further accelerate the adoption of RWA following an unprecedented pace of interest rate hikes from the Federal Reserve.

After reading this report, you can expect to understand better where industry sentiment lies, what were the most notable developments that took place in 2Q2023 for the RWA and stablecoin sectors, what to expect in the quarters ahead, and what Fortunafi has been up to, and where we’re headed next.

Want To Read The Full Report?

Every quarter, we break down what happened in RWA and stablecoins so you can stay informed and educated. Not only that, but we also provide a detailed outlook of what to expect in light of ongoing market developments.

Topics Covered:

• Crypto, RWA, & DeFi Sentiment

• The Rise of Tokenized Securities

• How MakerDAO Shook Up DeFi & RWA

• How U.S. Regulation Is Fueling Offshore & Decentralized Stablecoin Adoption

• Curve Finance’s crvUSD Stablecoin Release

• The Fight Between The SEC & Crypto

• Further Interest in RWA to Come From Governments & Institutions

 
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Disclaimer: The information contained herein is general information, intended for educational purposes only, and is not intended to constitute legal, tax, accounting, or investment advice. Information, opinions, and views are solely of Fortunafi, and none of the information contained should be used as the basis for any investment decisions. To ensure suitability, contact a licensed investment professional when making any investment decisions and do your own research.