Blockchain technology is increasingly attracting capital through a self-reinforcing cycle, according to senior crypto investor Jonah Burian. The process begins with stablecoins being deployed on-chain, which developers then utilize to create use cases that absorb these funds. This cycle continues to draw more capital, embedding it in decentralized exchanges (DEXs), lending markets, and derivatives, creating a new financial economy that generates billions in revenue annually. In 2025, stablecoin issuers earned over $13 billion in float income, while DEXs and other platforms generated over $5 billion in protocol revenue. The supply of stablecoins has grown approximately 60-fold since 2020, reaching about $300 billion. This growth is now attracting institutional capital, with firms like BlackRock and Apollo launching on-chain funds. The on-chain tokenized real-world assets (RWA) market has expanded from $8 billion to $25 billion in less than two years, indicating a shift towards blockchain-based financial systems. The efficiency of stablecoins is highlighted by their turnover rate, which is significantly higher than traditional financial systems. For every $1 billion in stablecoins, approximately $122 billion in economic activity is generated annually. This efficiency is driving a large-scale migration of capital from traditional infrastructure to blockchain systems, with the potential to eventually bring all assets on-chain.
Blockchain's Siphon Effect Draws Capital On-Chain, Boosting Economic Activity
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