The Weekly - 22nd April 2025
APR 22, 2025
Resilience
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Summary
In this edition, we cover:
The ‘Sell America’ trend
Divergence between crypto and risk assets
Stablecoin growth records and implications for DeFi
Resilience
Despite the quietness on the crypto western front, we're seeing significant underlying dynamics at play.
Global investors are increasingly frustrated and de-risking from US opportunities, whether risk assets of safe havens.
Trump’s recent comments on replacing Fed Chair, Powell, has fuelled further concerns. NASDAQ declined 5% from last Monday.
Trump and Fed Chair Jerome Powell have been unable to see eye to eye on economic policy more recently.
The key point? We are witnessing a structural shift in the economic dominance of the US.
“The geopolitical power structure is being reorganized under our eyes,” Jens Weidmann, the chairman of Commerzbank AG said this week.
With continued economic threats and policy volatility, the dollar and Treasury bonds, traditional havens at times of stress, all look much less appealing.
Crypto Is The Bright Spot
Meanwhile, crypto is showing resilience. In fact, it’s showing strength during these times.
Crypto is positively diverging to equities like tech stocks directionally while outperforming them on a relative basis.
Crypto markets are up +4% over the past week, while NDX was down -5%. A delta of 9%.
While early signs, such deltas in previous cycles are often rare with gold and crypto often sniffing out currency debasement before others. This time is no different.
Crypto is global, and while clearly influenced by US involvement, its market is benefiting from a de-emphasis of US dominance (e.g. through a weaker dollar).
As we wrote a mere few weeks ago, crypto sentiment was at record lows, diverging from a number of core market fundamentals like lending and derivatives.
“When time comes to buy you won’t want to” - Walter Deemer
Stablecoins and DeFi
Another form of divergence now emerging is DeFi and stablecoin - the latter which stands at an ATH of $240b.
DeFi TVL/Stablecoin MCAP ratio is also approaching cycle lows. It seems that DeFi has yet to ‘catch up’ to stablecoin trend where we can reasonably expect the sector to grow meaningfully.
As we highlighted earlier this month, stablecoins are critical parts for DeFi applications to function and can enhance lending activity, DEX efficiency, and stability for yield opportunities.
Higher stable supply will flood over to DeFi opportunities whether expressed via payments, collateral, or yield.
And eventually, these will get priced within DeFi valuations which we’re likely seeing early signs of.
Did Someone Say Solana?
And in terms of ecosystems, Solana has been seeing the highest rate of stablecoin growth in 2025 so far.
Solana has 2x its market share to 5.5%.
And with investor interest slowing picking up in the crypto sphere, Solana continues to see relative strength vs. Ethereum regarding decentralised exchange volume.
Solana’s high throughput, latency improvements, and reliably low cost fee markets have cemented it as a resilient home for investor speculation.
Updates on Re7 Lab Vaults
The Euler vaults curated by Re7 on Avalanche are gaining serious momentum, currently at $127m TVL. Top performing vaults include:USDC - 9.02% supply APYAUSD - 8.94% supply APYsavUSD - 12.94% supply APYUSDC and AUSD vaults accept the following assets as collateral: WAVAX, sAVAX, ggAVAX, WETH.e, BTC.b, SolvBTC.BBN, savUSD etc
We also launched Euler vaults on BNB chain, already at $3m+ TVL. Top supply vaults include YUSD, USDT and lisUSD.What’s up for grabs? 20,000 $rEUL rewards; Incentives from Lista DAO; Points from Aegis
mRe7YIELD is now live as collateral on Euler! you can use USDT, USDC or DAI to mint mRe7YIELD, earn delta-neutral yield and borrow USDC against your position.Use as collateral on EulerExplore mRe7YIELD on Midas
Make sure to join Re7 Labs Alpha Telegram channel for more DeFi vault announcements this week!
Disclaimers
The content is for informational purposes. None of the content is meant to be investment advice. Use your own discretion and independent decision regarding investments. The opinions expressed in all Re7 public research articles are the independent opinions of the authors at the time of publication and not the opinions of the affiliates of Re7.
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