DeFi in 2025: What’s Real, What’s Noise, and What Comes Next

By Al Leong, Blockchain CMO, Board Advisor

DeFi has matured — and fragmented. From staking to restaking, LSTs to LRTs, MEV to RWAs, modular stacks, zkVMs, and now AI-integrated smart agents, we’re witnessing the most important technological shift since smart contracts were invented.

This article is for everyone in the room: CEOs looking for market edge, degens chasing alpha, investors needing signal, marketing pros trying to translate complexity, and even total beginners trying to understand why everyone keeps saying “modular is the future.”

Let’s break down what’s real, what’s just hype, and what matters going forward. We’ll start with a few explanations to help you decode the lingo.

Quick Primer: What Is DeFi?

DeFi, or Decentralized Finance, refers to financial applications built on blockchain networks that operate without banks or traditional institutions. These apps use smart contracts — pieces of code that run automatically on the blockchain — to let you lend, borrow, trade, or earn yield directly from your wallet, no middlemen required.

Instead of asking permission from a bank, you’re interacting with code that’s transparent and open to anyone. All you need is a crypto wallet and some internet.

Now, let’s look at the technologies reshaping DeFi.

1. EVM and Modularization: Still the Dominant Stack

📊 Importance: 10/10 | 🔒 Staying Power: 10/10

EVM (Ethereum Virtual Machine) is like the operating system for most DeFi apps. Developers use it to write and run smart contracts. It’s everywhere.

Modularization means breaking blockchain functionality into layers (execution, consensus, data availability) to make them more flexible and scalable. Think of it like separating your smartphone’s hardware, software, and cloud storage to upgrade each individually.

Why this matters: Most DeFi lives on EVM-compatible chains. Modularization makes DeFi faster, cheaper, and easier to upgrade.

2. Staking → Restaking → LRTs → Symbiotic Security

📊 Importance: 8.5/10 | 🔒 Staying Power: 7/10

Staking is locking up crypto to help secure a network (like Ethereum) and earn rewards.

Restaking takes this further — you’re reusing your staked tokens to support other networks or apps and earn even more.

LRTs (Liquid Restaking Tokens) are tradable versions of restaked assets that give you flexibility, like being able to sell or use them while they’re still earning rewards.

Why this matters: It’s a way to get multiple layers of yield — but more reward means more risk. Know what you’re holding.

3. MEV and Blockspace Markets

📊 Importance: 9/10 | 🔒 Staying Power: 9/10

MEV (Maximal Extractable Value) is when someone — like a validator — reorders transactions to profit (e.g. by front-running a big trade).

Blockspace markets are emerging systems that price and sell access to transaction slots, like ad space during the Super Bowl.

Why this matters: MEV is unavoidable in public blockchains. The goal is to manage it fairly, not eliminate it.

4. RWA Tokenization: Real World Meets On-Chain Yield

📊 Importance: 10/10 | 🔒 Staying Power: 10/10

RWAs (Real World Assets) are things like real estate, treasury bonds, or invoices, brought on-chain as tokens. These tokens can be traded, used as collateral, or staked for yield.

Why this matters: RWAs connect traditional finance to crypto. It’s the most credible path to mainstream adoption and real income.

5. Intent-Based UX & Wallet Abstraction

📊 Importance: 9.5/10 | 🔒 Staying Power: 10/10

Intent-based UX lets users say what they want (e.g., “swap $100 into stablecoins”) without knowing how it happens under the hood.

Wallet abstraction simplifies onboarding so you don’t need seed phrases or gas tokens. It makes crypto apps feel more like regular apps.

Why this matters: Noobs and normies need great UX to stick around. This is the bridge to the next 100M users.

6. Modular Appchains, L2s, L3s, and RaaS

📊 Importance: 8/10 | 🔒 Staying Power: 8/10

L2s (Layer 2s) and L3s are blockchain layers built on Ethereum to make it faster and cheaper.

Appchains are chains dedicated to a single app or ecosystem.

RaaS (Rollup-as-a-Service) platforms help projects spin up their own blockchains with minimal effort.

Why this matters: Anyone can now launch a high-performance chain tailored to their product. That means faster innovation — but also potential fragmentation.

7. AI x DeFi

📊 Importance: 7/10 | 🔒 Staying Power: 8/10

AI is entering DeFi through:

• Trading bots that learn and adapt
• Portfolio managers that rebalance funds based on market data
• Smart agents that automate liquidity movement and strategy execution

Why this matters: AI can automate and optimize complex tasks for users and protocols alike.

8. zkVMs, zkWASM, and ZK Compute

📊 Importance: 8/10 | 🔒 Staying Power: 7.5/10

Zero-knowledge (ZK) proofs let someone verify information is correct without revealing the info itself.

zkVMs and zkWASM make this possible for apps and developers at scale, allowing private, auditable smart contracts and computation.

Why this matters: ZK tech enables privacy, security, and compliance — essential for both users and regulators.

9. What’s Dying or Already Dead

📊 Importance: 3/10 | 🔒 Staying Power: 2/10

Things like algorithmic stablecoins (which collapse without real collateral), over-leveraged yield schemes, and token models with no utility have been largely abandoned. Exception: FRAX.

Why this matters: The market has matured. Speculative hype dies quicker now. Builders need to focus on real value.

10. Chain Abstraction & Aggregators

📊 Importance: 8.5/10 | 🔒 Staying Power: 9/10

Chain abstraction means users don’t have to know what blockchain they’re on. It just works.

Aggregators route intents, transactions, and liquidity across multiple chains and apps.

Why this matters: Simplifies DeFi dramatically. In the future, most users won’t even know (or care) which chain they’re using.

📉 Final Word

2020–2022 was speculation. 2023–2024 was infrastructure.
2025 is convergence.

DeFi is becoming the financial backend of the internet. Real-world yield meets smart automation. Wallets vanish into apps. Chains blur together. And the winners? They’ll be the ones who make it all feel effortless.

No more just building for whales. Now we build for everyone.

📊 Scorecard: What’s Likely to Last