Group 1: Market Growth and Projections - Decentralised finance (DeFi) transaction volume is expected to exceed $3 trillion by next year, with total value locked across blockchain networks projected to reach $500 billion by 2026 [1][2] - Fundraising for DeFi-linked projects is anticipated to rise to $40 billion next year, doubling from approximately $20 billion in 2025, driven by capital injections from token sales and venture capital [2] Group 2: Hybrid Finance and Adoption - A hybrid finance model is expected to emerge, where traditional banks utilize DeFi smart contracts for settlement and yield, with the number of hybrid projects involving major banks projected to at least double by 2026 as regulatory clarity improves [3] - Real-world asset tokenisation is forecasted to grow from $1.1 trillion currently to $2 trillion next year, indicating a convergence of traditional markets with blockchain finance [4] Group 3: Leading Sectors and Market Structure - Key sectors leading the growth in tokenisation include tokenised funds, stocks, real estate, corporate debt, and money market funds, which will bridge traditional finance and DeFi, enhancing liquidity for both institutional and retail participants [5] - By mid-2026, DeFi wallets are expected to reach 12 million, although only 25-35% are projected to be unique active users, indicating a market stabilising in a more data-driven and utility-focused manner [6]

Core Insights - Decentralized finance (DeFi) protocols are increasing revenue distribution to token holders through buybacks, but this strategy may not be effective [1][4] - In July, the top 12 revenue-distributing protocols spent nearly $800 million on buybacks, marking a 400% increase since the beginning of 2024 [2] - Token buybacks aim to link token value to the success of DeFi protocols, with the expectation that higher profits will lead to increased buyback spending [3] Financial Analysis - The report from Keyrock indicates that many buyback programs overspend during high price periods and underspend during downturns, which can lead to inefficiencies [4] - A separate report from Messari supports the view that buybacks may not be a wise use of capital, as market performance is more influenced by growth metrics and narrative [5] Market Trends - Hyperliquid has successfully integrated buybacks into its strategy, with its HYPE token increasing by 500% since its launch in November 2024, prompting other protocols like Aave to consider similar programs [6] - Despite the initial surge in DeFi token values in 2021, many tokens have since underperformed as market excitement waned and valuations were questioned [7]