Welcome to DeFi Frontier, where I highlight the DeFi opportunities, protocols, and market themes worth paying attention to.

The goal is simple: find what’s interesting, understand the tradeoffs, and avoid blindly chasing the biggest APY on the screen.

Let’s get into it.

We’re fresh off a historic move for crypto assets so I felt the need to change up this week’s DeFi Frontier. While I don’t want to get ahead of myself, there’s a lot about this move to like and a lot that feels different, but more on that in a minute.

First off, if you’re sitting here reading this, give yourself a pat on the back. Not because you’re reading The Edge Newsletter, but because you’ve managed to pay attention to crypto during one of the most apathetic stretches I can remember.

The hardest thing for me personally, was staying long crypto through the generational AI boom. Of course anyone could partake in both asset classes, but for me personally I always kept a fairly high concentration long crypto so I didn’t have a lot of bullets to fire at the AI capex buildout trades. I also can get in a bit of a bubble with crypto and get tunnel vision and not see as much of what’s happening around me. I’ll touch more on this further on.

With that said, I keep coming back to this post by Paul the Co-Founder of Morpho. He nails something I’ve thought, but have never been able to articulate. I think this is a very important framing.

Tech moves fast, finance will always move slow:

This move we’ve witnessed doesn’t mean the bull is just going to come roaring back but like I said above there’s a lot to like.

It’s worth keeping in mind just how historic this move was though:

I agree with Will’s framing, “testosterone has returned”. BTC was hitting all time low levels of volatility and Bollinger bands were also in historically tight patterns. To see this type of upside move is huge. What it tells investors and maybe people on the sidelines is “BTC can still have massive moves”, which also signals to people “hey you can still make money holding BTC”.

I really liked Jamie Coutts framing as well:

Here are the most important passages from this post above from Jamie if you didn’t read the whole thing:

Lastly, I’m no macro expert and I do my best not to LARP as one. But it’s hard to spend nearly a decade in crypto without picking up some cursory understanding of macro and liquidity dynamics. They play such a pivotal role in how crypto assets perform.

With that said, it feels like we’re on the precipice of some monumental monetary policy moves. As I’m writing this, there are leaks all over the internet that Bessent is suggesting they will do anything and everything to back stop the bond market:

If you don’t follow, maybe this will make sense:

OK one more, some of these are too funny:

When you break all this down it sounds ridiculous. But that’s where we are now within our monetary Ponzi charade governments have been playing. It really does feel like we’re in the later stages of the fiat experiment.

None of this feels particularly good for society at large, but Bitcoin was always, at least in part, a bet against unbridled government spending. Say what you will about Bitcoiners, but they’ve been directionally right about a lot of things. The bill is coming due. We’ll see how much longer governments can kick the can down the road, or what new financial inventions emerge in the interim.

My bigger fear is what this means for people who don’t own hard or scarce assets. It seems likely to further accelerate the K-shaped economy and, with it, societal unrest.

OK, that’s enough doom and gloom. It’s been an amazing week for crypto, so if you keep reading, I’ll share what I’ve personally been holding and accumulating throughout the bear market.

I’m going to keep my reasoning for each of these holdings very short. They’re listed in order of portfolio allocation.

To be clear, I’m not saying all of these tokens are good buys at their current prices. They might be, but I have very good entries on some of them. I’m simply sharing what I currently hold and remain bullish on.

AWS of liquidity

The Settlement Layer for all of Finance

Take your pick:

Digital Gold

The Global Reserve Asset

The Hardest Money Ever Created

Best proxy for HYPE+

Digital Dollars for the Internet Economy

The Liquidity Layer of DeFi

The Crypto Neobank

The Asset Manager of the Future

I grouped these two together because, despite being completely different businesses, they sort of remind me of each other. Both teams seem top tier when it comes to execution and are using blockchain rails in a very interesting way:

And just as I was posting this DeFi Dad posted his holdings. We're unsurprisingly very similar:

I’ll start with what I got wrong at the end of the last bull market.

I was watching many of the classic Bitcoin indicators to help time the top. The problem was that, despite working well in previous cycles, virtually none of them fired this time around.

I put too much faith in those indicators. As a result, I didn’t take nearly as much profit as I should have. Some of the ones I was watching most closely were the MVRV Z-Score, Pi Cycle Top and The Everything Indicator.

The bigger lesson for me is that indicators built around previous Bitcoin cycles can create a false sense of confidence, especially as the structure of the market changes.

What I did manage to do was continue adding to my long-term crypto holdings throughout the bear market. But that came with a pretty significant opportunity cost.

As I mentioned in the opening, I essentially missed the entire AI stock run. I was so focused on staying locked in during the crypto bear market that I didn’t have the bandwidth to participate in what turned into a generational run for AI.

But you can’t play every game.

DeFi Dad and I have been talking about this lately. In investing, you’re always going to feel like you’re missing something. You can’t be in every asset class and every winning trade. Your attention is limited and so is your capital. Unless you’re Stanley Druckenmiller, which I am very much not.

The byproduct of missing the AI cycle and staying locked in on crypto is that I now feel pretty well positioned for what appears to be ahead of us. While others may have been caught offside by this latest move, I’m fairly happy with my current holdings.

One other experience I’ll share is just how difficult crypto venture investing has been for the 2021 vintage.

I’ve had the opportunity to see this firsthand, both working at a fund from 2021 to 2024 and investing as an angel through 2026. Five years is enough time to see something close to a full investment lifecycle (at least for crypto), from the initial investment to token launch and, in many cases, full vesting.

What I’ll say is that it has been difficult to even beat Bitcoin. The power law dynamics are very real. Most investments trend toward zero, while the entire portfolio ends up anchored by two or three major winners. I’ve been fortunate to back some incredible teams, but it has still been much harder than I anticipated.

Part of me is happy Cobie “democratized” access to early-stage venture through Echo. To the uninitiated, access to private crypto deals probably looked like some sort of money printer. Maybe it was for some of the earliest vintages, especially when low-float, high-FDV launches were in full swing, but that game is largely over. And thankfully so. It was never going to be healthy or long lasting.

I bring all of this up because I’m glad I started dialing back my angel checks in 2025. Both DeFi Dad and I became much more selective, which also allowed me to be more deliberate about some of the liquid opportunities that were emerging.

I can’t pinpoint the exact moment, but at some point it became clear that many liquid tokens offered a much better setup than venture. You had price discovery, liquidity and, in some cases, valuations that were more attractive than what we were seeing in private rounds.

HYPE is a good example. Despite receiving the airdrop, I continued adding to my long-term position at $12 and again at $28. In hindsight, I’m very happy I put that capital into HYPE rather than making more illiquid venture bets.

One final thing I got wrong was failing to lock in some long-dated calls a few weeks ago. I kept pushing it off because I genuinely thought we could see one more price shock before the larger inflection point. I thought I had a bit more time.

So I missed the best pricing on ETHA calls for example. But honestly, that’s probably fine. Missing the perfect entry doesn’t mean I should chase it now, and I’m not sure I need even more leveraged exposure to crypto anyway.

7 day benchmark stablecoin rates from Portals: 3.25%:

Here’s the top yielding stablecoin vaults (real yields) for the past 30 days:

Checking in on Stablewatch to see the 7-day TVL changes.

This week the top movers were: Inverse (sDOLA) +40.1%, OpenTrade (XDFIS) +31.2%, Yuzu (yzPP) +14.7%:

7 day benchmark ETH staking rates from Portals: 2.29%

Here’s the top yielding ETH vaults (real yields) for the past 30 days:

Here’s a snapshot of the front page of looping this week from yieldz.io (30d APY):

Taking a look at the front page of Stablecoin yields and RWA yields this week on Pendle:

Stablecoins

RWA

Thanks for reading!

DISCLAIMER: Nothing written in The Edge Newsletter or said on The Edge Podcast is a recommendation to buy or sell tokens or securities. This content is for educational and entertainment purposes only. Nothing shared here is financial advice. Any views expressed in our content are solely the opinion of that writer, host, or guest. Always do your own research. DeFi Dad, Nomatic, and guests may have positions in the assets or other matters discussed in this content.