What's next for DeFi in 2026?
We've revealed the trends we'll be focusing on next year.
Last year, DL News attempted to predict three major DeFi trends for 2025.
We predict that traditional finance will enter DeFi at an unprecedented pace, more protocols will launch their own blockchains, and fintech companies will incorporate DeFi into their products on a large scale.
As it turns out, our judgment was quite accurate.
In 2025, we will see banks issuing stablecoins, asset management firms allocating billions of dollars to DeFi lending protocols, and Wall Street firms flocking to the tokenized asset space.
In January, Coinbase kicked off a wave of fintech consolidation with its Morpho-based Bitcoin lending service. In June, trading giant Robinhood began using Arbitrum to offer tokenized stock trading services to its European users.
Just two weeks ago, Revolut, a new bank with $75 billion in assets, integrated Uniswap, the largest decentralized exchange, for fiat currency deposits, exchanges, and cryptocurrency purchases.
As for customized blockchains, it's no longer just DeFi protocols launching them. Fintech companies have also joined the competition, with Stripe's upcoming Tempo blockchain being the most notable example.
These trends are likely not over yet, and will only grow further in the coming year.
But as 2025 draws to a close, we will attempt to predict three other trends that will shake up DeFi in 2026.
Unified stablecoin layer
If there's one trend that will define DeFi in 2025, it's stablecoins.
The circulation of dollar-pegged tokens has surged to over $300 billion, with everyone from family office managers to U.S. Treasury Secretary Scott Bessant making grand predictions about its exponential growth.
However, despite its tremendous success, stablecoins still face a major obstacle to continued adoption: liquidity fragmentation.
The largest stablecoins are scattered across numerous different trading venues, blockchains, and exchanges. This fragmentation makes it more difficult for traders to efficiently execute large orders, resulting in higher transaction costs, greater price volatility, and lower market efficiency.
We predict that in 2026, stablecoin issuers will make significant progress in addressing this issue by building and promoting the adoption of a unified liquidity layer.
Many stablecoin issuers have already begun to take action.
Circle has launched its Cross-Chain Transfer Protocol, which allows developers to transfer USDC between different blockchains through native burn and minting mechanisms.
Similarly, Tether, the largest stablecoin issuer, has launched USDT0, a full-chain stablecoin that operates as a single asset across multiple blockchains.
If these companies succeed, Jascha Samadi, co-founder of crypto venture capital firm Greenfield Capital, told DL News: “Stablecoin transfers and conversions will become more capital-efficient, cheaper, and more predictable.”
DEX and CEX are in direct competition.
There has long been a trade-off in using decentralized exchanges (DEXs). While permissionless, DEXs sacrifice liquidity and price competitiveness compared to centralized exchanges.
In 2025, this changed. Improved user experience, intent-based trading, and the dark pool AMM model on Solana enabled some DEXs to become as competitive as, or even better than, centralized exchanges.
At the same time, traders are becoming increasingly weary of the failures of centralized exchanges.
In May, Coinbase disclosed that cybercriminals bribed and recruited a group of unscrupulous customer service personnel overseas to steal customer data for social engineering attacks.
Subsequently, in October, Binance apologized for its system unfairly liquidating users' trades during a period of high volatility and refunded $283 million to users.
More commonly, people complain about centralized exchanges having technical glitches, restricting accounts without prior notice, and having difficulty obtaining customer support.
Over the past year, the proportion of crypto trading conducted through DEXs has grown rapidly. According to an analysis by CoinGecko using data from DefiLlama, as of November, DEX trading volume accounted for more than 21% of all crypto trading, a record high.
We predict this trend will continue. It may be too early for DEXs to surpass centralized exchanges in absolute trading volume next year, but by the end of 2026, they could account for 50% of all crypto trading.
Privacy drives adoption
This year, privacy has rapidly become one of the most important topics in DeFi.
Zcash, a privacy-focused blockchain, outperformed other assets in the market with an astonishing 860% increase in the last three months of this year. Its ZEC token hit $711 in November, the highest price since 2016, before falling back to $395.
In other news, the Ethereum Foundation announced it will expand its efforts to embed privacy into the $284 billion blockchain.
Advocates argue that cryptographic privacy is crucial for protecting the personal safety of technology users. Just as people don't want their traditional bank statements to be made public, users generally don't want their entire financial life exposed on the blockchain.
For institutions tentatively venturing into DeFi, the lack of built-in privacy presents a dilemma. According to representatives from Canton Network, a blockchain designed for institutional finance, they face the choice between using blockchain while risking exposure to pricing, strategies, or sensitive investment positions, or continuing with slower, less efficient traditional systems.
Canton is not the only one to have put forward this view.
In a previous interview with DL News, Alan Scott, co-founder and contributor to the Railgun privacy protocol, stated that privacy-compatible security features, such as private multi-signature wallets, are a necessary prerequisite for many institutions looking to go blockchain.
Our ultimate prediction is that in 2026, the adoption of privacy-oriented protocols and blockchains will continue to grow, with more blockchains—such as Ethereum—launching their own privacy infrastructures, and these developments will drive a new wave of institutional adoption.
