Math Made Simple: Why Capital Is Moving from 4.3% US Treasuries to DeFi’s 22% Stablecoin Yields

Key Points

1. Over $35 trillion in U.S. fixed-income assets may rotate due to expected Fed rate cuts, with money market funds currently yielding 4.2%-4.4%.

2. Stablecoin DeFi lending offers significantly higher yields (12%-22%) compared to traditional fixed-income assets, attracting investor capital.

3. Ethereum, Solana, and Sui are emerging as key networks for stablecoin issuance and DeFi activity post-GENIUS Act.

4. U.S. Treasury securities, with yields of 3.93% (3-year) and 4.50% (10-year), are losing appeal as DeFi provides more lucrative alternatives.

5. The capital rotation trend highlights a growing preference for digital dollar alternatives like USDC and USDT in DeFi lending pools.