Repricing the Global Order: Macro Dislocation Meets Crypto Adoption Acceleration

10 min readApr 28, 2025

MV Capital | April 2025

I. Global Macro: From Policy Shock to Opportunity

Tariffs and the New Trade Regime

2025 has ushered in one of the most significant macroeconomic realignments in over a decade. The reintroduction of protectionist policies by the United States — notably the average 22.8% tariff rate implemented under the new administration — has jolted global markets into volatility. These tariffs mark the highest levels since the Smoot-Hawley era, prompting swift retaliation from key trading partners like China and the EU.

Chart 1: A Century of Tariffs: U.S. Import Rates from 1909 to 2025. Source: https://x.com/biancoresearch/status/1911891923725619651/photo/1

The consequences are already playing out in real time:

Over $10 trillion in global equity value has been wiped out since the tariffs were announced. The S&P 500 experienced a historic 10%+ correction in just two trading sessions, one of the steepest drops on record.
The USD/JPY has broken down below critical technical support at 141, forming a long-term rounded top — historically a leading indicator of global capital flight and rising demand for real assets like gold and Bitcoin.
The U.S. Dollar Index is having its worst month since 2009, while 10-year Treasury yields have surged. The U.S. bond market is behaving more like an emerging market — with volatility and risk premiums rising — which may force the Fed to delay rate cuts, or even consider hiking, unless tariff-driven shocks are reversed or mitigated.

Chart 2: Macro Pressures: USD Falls, 10Y Yield Rises. Source: https://x.com/bbx_official/status/1914526096478871668

Liquidity Rebuilds Beneath the Surface

While headlines have focused on risk, the quiet resurgence of liquidity offers a contrasting signal. Net Federal Reserve liquidity — a function of the TGA, Fed RRP balances, and reserve injections — has increased by over $240 billion since January 2025, driven by:

QT tapering (from $25B/month to $5B/month)
Declines in the Treasury General Account (TGA), injecting funds into bank reserves
Low net Treasury issuance, further enhancing liquidity conditions.

Simultaneously, China’s credit impulse is turning, and global M2 growth is recovering from multi-year lows. Together, these dynamics suggest that risk assets — particularly those sensitive to liquidity conditions like crypto — may be on the cusp of a revaluation.

The Global Economy Index (GEI), a composite of trade-weighted FX, copper/gold, China 10Y yields, and crude oil, is now emerging from a cycle trough. Historically, GEI inflections lead price recoveries in Bitcoin and equities by 3–6 months.

Chart 3: Global Economy Index vs. Bitcoin and S&P 500. Source: https://x.com/TomasOnMarkets/status/1912520160662999367/photo/3

“We’re not witnessing a temporary dislocation, but a structural recalibration — reshaping global trade, monetary policy, and capital flows. Liquidity is quietly returning, led by China, Japan, and Europe, with U.S. balance sheet expansion likely to follow as debt refinancing accelerates. As capital begins to align with structural demand, market repricing can be swift. In this cycle, we see rotation into commodities and crypto as a key — and potentially primary — source of alpha.” Ivan Ripamonti

II. Crypto Market Outlook: From Narrative to Fundamentals

Bitcoin: Macro Hedge, Institutional Mainstay, and Network of Record

As the macro regime shifts, Bitcoin evolves from a speculative asset to a sovereign-grade macro hedge. It has decisively outperformed the S&P 500 and Nasdaq YTD, and now trades at all-time highs relative to the Magnificent 7 tech equities. This is not merely a technical rally — it’s underpinned by strong fundamentals:

Institutional BTC holdings have surged to 688,000 BTC, with new corporate entrants joining every quarter. In Q1 2025 alone, 12 new publicly listed companies added Bitcoin to their corporate treasuries — a record quarterly expansion. Among them, GameStop’s entry stood out not just for its size but for its strategic shift: the company restructured part of its balance sheet into Bitcoin as a hedge against dollar volatility and to align with its evolving digital-first strategy.
On-chain metrics (SOPR, exchange outflows, LTH supply) all signal long-term accumulation.
April seasonality has historically been one of Bitcoin’s strongest trends, with April producing an average return of +34.4% since launch, making it one of the best-performing months in BTC’s price history.

Chart 4: Bitcoin Seasonality: Average Monthly Performance. Source: Glassnode.

Volatility has fallen to all-time lows, as shown in ARK’s 2025 research, bringing Bitcoin’s risk profile closer to that of traditional assets such as gold and equities. While Bitcoin remains volatile compared to bonds and real estate, its Sharpe and Sortino ratios surpass all major asset classes.

Chart 5:ARK Invest — Big Ideas 2025: Bitcoin. Source: https://x.com/Cointelegraph/status/1912242277767958911/photo/1

This trend is bolstered by political tailwinds in the U.S. Recent executive orders have:

Established the foundation to create a Bitcoin strategic reserve and a digital asset stockpile
Authorized Bitcoin custody at banks
Promoted dollar-backed stablecoins
Explicitly banned central bank digital currencies (CBDCs)

Together, these policy actions are legitimizing Bitcoin not only as a digital asset but also as a digital sovereign reserve. Bitcoin is now competing with gold, bonds, and fiat reserves in institutional portfolios.

DeFi and Stablecoin Infrastructure: Usage Over Hype

While speculative asset flows have moderated, real infrastructure usage across DeFi and stablecoins continues to strengthen meaningfully. The recent data highlights a notable transformation:

DEX Volumes Sustain High Growth
After peaking earlier this year, decentralized exchange (DEX) volumes have normalized but remain robust — still up significantly year-over-year. This reflects sustained user engagement beyond speculative spikes. The market has shifted from “hype trades” to organic adoption fueled by genuine liquidity needs across chains.
Stablecoins Expand Despite Volatility
The stablecoin market cap now exceeds $215 billion, with consistent positive net inflows even amid market fluctuations. This signals stablecoins’ growing role as transactional and liquidity instruments rather than mere trading vehicles. Their resilience, especially during periods of stress, underpins a foundational layer for DeFi and real-world asset (RWA) integration.
DeFi Lending Remains Solid
DeFi lending total value locked (TVL) peaked above $55 billion and, after a partial retracement, has stabilized near $40 billion. Leading protocols like AAVE maintain dominant market share (~44% of the top 10 lending platforms), emphasizing the network effects and user stickiness in mature DeFi applications. Innovations like isolated pools and new collateral types continue to enhance capital efficiency.

Chart 6: Stablecoin Supply Growth (2019–2025) [Blue: USDC/USDT, Green: DAI, Yellow: BUSD, Light Blue: UST]. Source:https://archimed.substack.com/p/the-insider-143?r=2qggg2&utm_campaign=post&utm_medium=web&triedRedirect=true

The Shift: From Hype to Infrastructure

The evolution of DeFi and stablecoin ecosystems reflects a deeper investment thesis:

Capital Efficiency and Real Yield
Platforms are increasingly focused on generating sustainable, risk-adjusted returns rather than relying on inflated token incentives. Yield strategies are now anchored in real usage — such as borrowing demand, trading fees, and RWA cashflows — building a more defensible and attractive value proposition.
Composability Across Chains
Cross-chain infrastructure has matured significantly, allowing users and developers to compose complex financial products seamlessly across ecosystems. Liquidity and functionality are no longer siloed to single chains, driving broader adoption and deeper capital markets.
Interoperability With Traditional Finance (Especially RWAs)
DeFi is increasingly interoperating with traditional finance, particularly through tokenized RWAs like Treasury bills, real estate, and credit products. This expansion moves DeFi beyond speculative trading toward offering access to institutional-grade yield, credit, and payment solutions to a much broader audience.

Protocols generating real revenue (DEXs, perps, yield aggregators) have collectively produced over $7.7B since Jan 2024. This is not speculative — it is structural usage growth.

Chart 7. Fundamentals Over Fluctuations: $7.7B Crypto Revenue Led by Core Sectors. Source: https://archimed.substack.com/p/the-insider-143?r=2qggg2&utm_campaign=post&utm_medium=web&triedRedirect=true

III. Portfolio Construction: Where We’re Investing in 2025

Across our private market and liquid investments, our capital deployment focuses on asymmetric exposure with real cashflow potential. We are currently concentrating on four core verticals:

1. High-Performance Execution Environments: Solana & Sui

Solana processed over 75% of all blockchain transactions in Q1 2025, driven by its fast, low-cost architecture and optimized validator throughput.
Firedancer, the new validator client from Jump Crypto now in testnet, is expected to deliver >1M TPS — significantly enhancing Solana’s scalability and resilience.
While SIMD-0228 didn’t reach quorum, ongoing fee market upgrades (e.g., Jito MEV tips) are already reducing latency and aligning economic incentives across the validator set.
Solana powers real-world applications across payments (USDC), DePIN (Helium), gaming, and tokenized AI services — positioning it as a foundational execution layer.
Sui processed $38.3B in DEX volume and generated $10.4M in protocol revenue in Q1 2025, far surpassing peers like Aptos ($1.7M).
With localized fee markets and programmable transaction blocks, Sui enables flexible, cost-efficient infrastructure for gaming, AI, and high-frequency DeFi use cases.
Both chains are evolving into performance-first environments for real economic activity at institutional scale.

2. DeFi Lending & DEXes: Foundations of Onchain Finance

Lending protocols remain the most stable revenue drivers in DeFi, outperforming other verticals in both TVL retention and fee consistency.
Aave maintains a 44% share of the top 10 lending TVL, scaling across chains while optimizing risk and onboarding institutional capital.
Protocols like Euler, Morpho, and Kamino are gaining momentum via modular lending designs, smart routing, and collateral efficiency.
DEXes like Raydium continue to play a critical liquidity role, posting $508B in volume in January 2025 alone, led by deep pools and strong aggregator support.
Raydium has reestablished itself as Solana’s core DEX infrastructure, capturing spillover from memecoin volume and onboarding new perps and yield products.
Lending remains our highest-conviction vertical in DeFi due to its predictable revenues, scalable architecture, and growing links to RWAs (e.g., Clearpool, Centrifuge).

Chart 8: RWA Market Map. Source: Proprietary MV Global RWA Report

3. AI-Native Agents Transforming DeFi

AI agents and oracle networks are becoming core infrastructure in DeFi, not just supporting tools.
These agents automate strategy execution, risk management, rebalancing, and data-driven optimization.
Capital efficiency is improving through AI-led execution layers, especially in lending, trading, and liquidity provisioning.
Protocols such as Bittensor and TAO subnets are exploring the development of AI-native DeFi ecosystems.
The result is an emergent “middleware” across Web3 that enables DeFi to operate more like high-frequency, adaptive financial systems.
AI adoption is accelerating as on-chain agents begin to outperform manual strategies in volatile macro environments.

4. Bitcoin DeFi: Unlocking Native Yield at Scale

Bitcoin-native smart contract ecosystems (e.g. Runes, BRC-20 2.0, sBTC) are activating a large pool of previously idle capital.
Over 80 Bitcoin L2s are currently active, with Core, Babylon, BOB, and Bitlayer leading by TVL and developer traction.
These L2s enable DeFi primitives like lending, staking, and bridging on Bitcoin, previously only available in the Ethereum ecosystem.
Bitcoin is transitioning from a passive store of value to an active yield-bearing layer in the broader crypto economy.
This shift aligns with institutional demand for hard-money assets offering programmable utility and yield.

Chart 9: Bitcoin L2 Ecosystem TVL. Source: https://x.com/BitcoinEcoTK/status/1910301295719907827/photo/1

“This is where compute, capital, and cryptographic trust converge — and where we expect the next wave of outsized returns to stem from application-layer projects delivering real-world utility, grounded in strong fundamentals, rather than speculative narratives.” — Johannes Fuchs

IV. Final View: The Window Is Open

We’re at the beginning of a capital rotation — moving beyond the memecoin euphoria of late 2024 toward real, application-layer innovation in DeFi, AI, and the Bitcoin ecosystem. This marks a shift toward more mature investor expectations and signals a more disciplined, fundamentals-driven capital cycle.

Simultaneously, regulatory clarity in the U.S. — from ETF approvals to banking custody — is solidifying Bitcoin’s position as a global sovereign-grade asset and programmable store of value.

“Capital is no longer chasing headlines — it’s reallocating in anticipation of a new global financial order. As we enter a major rotation across asset classes, Bitcoin and crypto are poised to attract significant flows and assume their role as structural components in modern, regulated portfolios.” Lee Pickavance

For allocators and partners evaluating this next phase, we believe this is a rare moment: where macro dislocation meets crypto utility, and where positioning today can define performance for years to come.

📩 Contact us at invest@mvglobal.io to learn how MV Capital is deploying capital through this regime shift via our VC Fund I, VC Fund II and our liquid hedge fund, the MV Global Opportunity Fund. We’re happy to share our investment frameworks and long-term conviction across this next macro cycle.

About MV Global

Established in 2019, MV Global has emerged as a force in the Web3 landscape focused on early-stage investments and venture building. Our mission is clear: to partner with mavericks, visionaries, and free thinkers to leverage blockchain-enabled technologies to build for the future.

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