Bitwise Says DeFi Tokens Held Up Better Than Bitcoin as Market Repricing Gains Traction

Bitwise said decentralized finance tokens have recently shown unusual resilience relative to Bitcoin, a sign the market may be quietly repricing the sector.

Cointelegraph reported on July 10 that Bitwise, in a report released the same day, said its DeFi index fell 4% in June, while Bitcoin dropped about 22%.

DeFi tokens typically move far more sharply than Bitcoin, making their relative resilience this time unusual and largely overlooked by the market, Bitwise wrote. The firm added that the ecosystem is stabilizing as traditional institutions begin using DeFi protocols in practice. It also said tokenomics are improving and the gap between real usage and token valuations is narrowing.

Bitwise cited Aave as an example. The report said institutions are participating in protocols such as Morpho and Jupiter, and that Aave alone generated about $900 million in revenue over the past year.

Bitwise's DeFi index is weighted by market capitalization, with 61% of the portfolio currently concentrated in Hyperliquid's HYPE token. HYPE has gained more than 160% this year. The index's other holdings, including Uniswap, Ondo and Aave, are all down by double digits year to date.

Total value locked across DeFi has fallen about 40% this year. Crypto data platform CryptoRank said DeFi TVL declined from about $115 billion in January to about $70 billion at the end of June. The main driver was a broad market correction following Bitcoin's peak above $126,000.

Bitwise identified stablecoin legislation and a broader crypto market structure bill as the next major variables for the market. It said the GENIUS Act, a US stablecoin law enacted last year, is due to take effect in January 2027 and could trigger a wave of stablecoin project announcements from large companies. On the CLARITY Act, a crypto market structure bill now under review in the Senate, Bitwise said passage would signal the bottom of the current bear market. Failure to pass the bill would likely increase short-term volatility, though uncertainty would ease as the industry continues to grow under crypto-friendly leadership at the SEC and CFTC.