A new report by Vestun outlines the state of the market as of April 2025. Since our last report in October 2024, the market underwent a significant drawdown and valuations fell in the most hyped sectors. However, there is still development in the AI sector, RWA and robotics that is continuing to grow despite the price action of their tokens. We believe the market is maturing and whilst attention has yet to return to fundamental growing utility tokens, the opportunity is still there in some of them.
Key Highlights
- The market this quarter has been deeply impacted by TradFi and global macro, and has endured a drawdown across the board in majors and many altcoins headed to range lows or below.
- The AI Agent sector experienced significant volatility since our October 2024 report, with substantial drawdowns following the initial speculative frenzy, but developer activity remains robust in the DeFAI sector with potential for products that capture genuine use cases and revenue.
- The RWA (Real World Assets) sector continues to show steady growth in TVL and institutional adoption, despite the lack of a significant market rally.
- We are also bullish on the robotics space, and are exploring early opportunities within this sector that synergize well with blockchain.
- Liquidity fragmentation and capital flows toward base assets present both challenges and opportunities as the market matures toward more sustainable valuation models.
- Market dynamics reveal a challenging environment for utility tokens, with even revenue-generating protocols experiencing drawdowns, suggesting a fundamental reassessment of value accrual mechanisms is needed.
- We adapted well to rebalance our portfolios ahead of the curve, and were able to capitalize on the mania that was the AI Agent space for those few months. As the hype cycle has now been deflated, the sector will see significant changes where true PMF protocols will emerge.
- The RWA sector appears positioned for sustainable long-term growth, particularly as traditional financial institutions continue exploring blockchain technology for efficiency gains and cost reduction.
- One of the most concerning trends in the current market is the persistent downward pressure on utility tokens, even those with demonstrable revenue and value accrual mechanisms. Projects like BANANA GUN, AAVE, HYPERLIQUID, and Houdini Swap, despite generating significant revenue and implementing token value accrual, have experienced substantial drawdowns.
- In this environment, disciplined analysis of revenue, emissions, and value accrual mechanisms will be critical for identifying investments with sustainable appreciation potential. While speculative opportunities will continue to emerge, the path toward long-term value creation likely lies in protocols that effectively bridge the gap between on-chain activity and token holder returns.
About Vestun
Vestun is Authorized and Regulated in Switzerland as a financial intermediary and is a member or the industry organization for asset managers. Any opinions in the above are Vestun’s views only. None of the above is investment advice, a recommendation or an offer to sell or a solicitation of an offer to buy any securities. Such views are as of the date of such document only. Vestun is currently not open to new investors.
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