Overview of the report content

On September 24, 2026, Multicoin Capital published a research article on the evolution of market structure between RWA and DeFi 2.0. The article argues that as real-world assets such as stocks, bonds, commodities, and foreign exchange continue to be tokenized, the DeFi infrastructure built around crypto-native assets will further evolve to meet the distinct needs of RWAs in trading, financing, and risk management.

The article primarily covers the following dimensions:

The formation logic of DeFi 1.0: Analyze the relationship between early DeFi infrastructure and the characteristics of native crypto assets.
Asset changes brought by RWA: Analyze the differences in volatility, maturity, cash flows, collateral, and participant structure of real-world assets.
The Infrastructure Evolution of DeFi 2.0: Exploring how financial primitives such as trading, lending, derivatives, and risk management adapt to RWA.
Value expansion brought by RWA: Analyze the increase in financial activities after asset tokenization and the new demands that different on-chain infrastructures may accommodate.

Original link: https://multicoin.capital/2026/09/24/defi-2-0/

DeFi 1.0 is not obsolete; the underlying assets are simply changing.

Multicoin’s assessment of DeFi 1.0 is a crucial starting point for this article: AMMs with low capital efficiency, overcollateralized lending, and floating-rate markets, which appear inefficient today, do not indicate that early DeFi’s design direction was flawed—rather, these products were designed from the outset to serve a very specific class of assets.

Early on-chain assets were primarily Crypto Native Assets such as BTC, ETH, and SOL, followed by a large number of long-tail tokens. These assets typically exhibit high volatility, lack stable cash flows, have no defined maturity date, and are primarily held by anonymous or pseudonymous accounts. Correspondingly, the market structure of DeFi has gradually evolved into several typical product categories:

AMM: Long-tail tokens first need to address the question of whether there is a market; therefore, AMMs that can quickly establish liquidity without requiring professional market makers are better suited for early on-chain markets.
Over-collateralized lending: Since the protocol cannot access the balance sheet or credit history of anonymous wallets, it manages risk through higher collateralization ratios and automated liquidations.
Floating-rate lending: For traders leveraging volatile assets like SOL and ETH, a few percentage points in financing cost changes are negligible compared to the price fluctuations of the underlying assets.
Perpetual Contracts: Assets like BTC and ETH have no expiration date, and traders often require continuous price exposure; therefore, perpetual futures, which have no fixed term, are naturally suited to these assets.

Thus, DeFi 1.0 effectively established a financial infrastructure highly aligned with crypto-native assets. Problems emerged after the underlying assets began to change.

When government bonds, equities, corporate credit, commodities, and foreign exchange enter the chain, their volatility, cash flows, maturities, credit relationships, and trading participants differ significantly from native crypto assets. Multicoin summarizes this shift as five characteristics:

Lower volatility and narrower spreads, defined terms and predictable cash flows, higher-quality collateral and identifiable borrowers, larger institutional participants, and more diversified portfolios and risk exposures. This means that the challenges facing RWA on-chain are shifting from “how to tokenize assets” toward “how to build truly tailored trading, financing, and risk management systems around these assets.”

RWA is redefining on-chain trading and credit infrastructure

3.1 From AMM to CLOB and RFQ: Execution Quality Begins to Matter

For high-volatility assets like Meme coins, a few percentage points of slippage may quickly be offset by price movements. However, for low-volatility assets such as government bonds and foreign exchange, where profit margins are inherently smaller, a few basis points in execution difference can directly impact trade outcomes.

Therefore, Multicoin believes that as these assets come on-chain, CLOBs, RFQ, and professionally managed propAMMs will become increasingly important. Professional market makers can dynamically quote prices by incorporating external market prices, volatility, order flow, and their own inventory levels, rather than merely passively providing liquidity along an AMM curve.

Meanwhile, low-volatility assets may also expand the use cases for on-chain options. Strategies such as Covered Call, Collar, Downside Protection, Volatility Trading, and Structured Yield have more clearly defined applications on assets like stocks, indices, commodities, and foreign exchange. Multicoin therefore presents a notable insight: some early DeFi products were not fundamentally misguided, but rather applied to assets on-chain that were not yet suitable for these financial instruments.

3.2 From Floating Rates to Term Markets: On-Chain Markets Begin to Form the “Price of Time”

Another important difference between RWA and crypto assets lies in their maturity.

Corporate financing, bond investments, foreign exchange hedging, and commodity trading typically involve defined time horizons. For example, a company undertaking a three-year financing arrangement must determine its future financing costs in advance; bond investors, meanwhile, need to calculate the spread between asset yields and financing costs.

This is increasing the significance of fixed-rate, fixed-term lending.

Multicoin uses Morpho Midnight as an example, which establishes fixed-term markets through bids and offers at different maturities. If on-chain interest rates gradually form for terms such as 3 months, 6 months, 1 year, and even longer durations, a yield curve can be further established, serving as the pricing foundation for products like bonds, loans, forwards, and swaps.

Yield trading represented by Pendle, Exponent, and Boros may also gain a larger asset base. Previously, on-chain tradable yields primarily came from staking, lending rates, perp funding, and protocol points; with RWA being tokenized, real-world financial cash flows such as treasury rates, credit spreads, dividends, and floating-rate loans can now enter this system.

Therefore, the change brought by RWA is not just about adding new tokens, but potentially making maturity, interest rates, and cash flows themselves tradable financial elements on-chain.

After institutional funds enter, the on-chain market requires a new risk management system.

When trade sizes expand from tens of thousands of dollars in crypto trading to institutional trades of tens or even hundreds of millions of dollars in stocks or bonds, fully disclosed trading intentions can incur additional costs. As a result, traditional financial markets have developed mechanisms such as block trading, RFQs, hidden orders, crossing networks, and dark pools.

Multicoin noted that DeFi has begun to see similar efforts: Renegade uses MPC and ZKPs for private order matching with on-chain settlement; Silhouette is building a Dark Pool on Hyperliquid; and Zama is attempting to provide privacy infrastructure for on-chain applications through FHE. It is important to distinguish here between “hiding settlement” and “hiding trade intent”—institutions do not necessarily require trade outcomes to be permanently hidden, but typically need to avoid exposing positions prematurely during execution.

On the other hand, when stocks, government bonds, commodities, forex, and Crypto are all integrated into a single on-chain portfolio, the isolated margin model of traditional DeFi reveals inefficiencies in capital utilization.

For example, treasury positions may hedge risk against interest rate futures, and stocks may offset risk against options. If the system can calculate risk at the entire portfolio level, it can reduce the need for duplicate collateral. Multicoin therefore believes that the value of Portfolio Margin and DeFi-native Prime Brokerage will further increase as RWA grows. Project 0 has already begun exploring a unified margin and credit system across multiple DeFi venues on Solana.

This means that DeFi's account system may further evolve from a “one protocol, one pool” model toward a unified balance sheet that spans assets and markets.

The growth of RWA comes not just from asset size, but from the financial activity surrounding each dollar of assets.

When discussing the RWA market opportunity in the past, the focus was typically on the fact that the total size of traditional financial assets—such as global equities, bonds, and commodities—far exceeds that of crypto, meaning even a small portion tokenized could significantly expand the scale of on-chain assets.

Multicoin further notes that the incremental value of RWA to DeFi has a second layer: the financial infrastructure required around traditional assets is inherently more complex than that of most crypto assets.

A meme token may primarily require spot, perpetual, and lending; but a government bond can be traded, financed via repo, used as collateral, included in fixed-income portfolios, and hedged with futures and rate derivatives; a stock can further enable securities lending, options, forwards, covered calls, portfolio margin, and index products.

Therefore, if RWA continues to enter the blockchain, its potential value could spread across multiple layers:

L1/L2 → Core financial primitives such as trading and lending → Prime Brokerage and aggregation layer → Applications and order flow

The underlying blockchain handles increased volumes of quotes, trades, settlements, and collateral movement; trading, lending, interest rate, and options protocols generate revenue from financial activities; aggregation and Prime Brokerage manage cross-market capital allocation and risk management; applications that ultimately control user relationships determine trade routing, collateral allocation, and order flow.

This also explains Multicoin’s definition of “DeFi 2.0”: many of these infrastructure components are not new—they’ve all been attempted in DeFi before, including Order Books, RFQ, Options, Structured Products, Fixed-term Lending, Yield Stripping, Rate Derivatives, Dark Pools, and Portfolio Margin. What has truly changed is that the assets matching these financial primitives are now coming on-chain.

Summary: RWA is transitioning from "asset tokenization" to "asset usability."

Multicoin provides a clear overview of the RWA phase shift: the first stage primarily addresses how assets are tokenized and brought onto the blockchain, while the next stage focuses on how these assets are genuinely utilized once on-chain.

From this perspective, the impact of RWA on DeFi may go beyond simply adding new asset classes such as government bonds, stocks, or commodities; more importantly, it brings traditional financial elements—maturity, cash flows, credit, institutional trading, and portfolio risk—on-chain. While AMMs, perpetuals, and over-collateralized lending built around highly volatile crypto assets will continue to exist, infrastructure such as CLOBs, RFQs, term lending, interest rate derivatives, options, dark pools, portfolio margin, and prime brokerage may gain even greater importance around RWA.

What makes this report noteworthy is that it advances the discussion on RWA from “what assets to issue” to “what is needed after assets are tokenized.” While tokenization addresses the entry point for traditional assets onto the blockchain, activities such as trading, financing, yield management, risk hedging, and portfolio management determine whether these assets can sustain ongoing on-chain financial activity. Consequently, the next phase of competition in RWA may gradually shift from the number of assets issued to the ability to build a comprehensive financial infrastructure around them.