Analysts: DeFi isn't dead, low yields are part of the market cycle

Despite claims that DeFi is dead, the current low yields are merely a feature of the market cycle, according to ivangbi, who works on DeFi at the Ethereum Foundation (EF). He posted on X that while DeFi is criticized for yields lower than traditional finance, this is expected in a bear market where funding rates and token incentives decrease. To solve this, he said, the ecosystem must increase on-chain revenue and infrastructure activity. He also warned that as more projects adopt real-world assets (RWA), investors may find on-chain versions to be inferior. Haseeb Qureshi, a partner at crypto investment fund Dragonfly Capital, agreed, stating that DeFi yields have always fluctuated with the Federal Funds Rate (FFR) and on-chain capital demand. He described the current on-chain yields as cyclical and normal.