AI agents, custody, and institutional product expansion
Institutional DeFi & Tokenization
In 2024, the landscape of institutional DeFi is undergoing a profound transformation, driven by the convergence of tokenized assets, regulatory clarity, advanced security tooling, and innovative automation through AI agents. This integrated narrative reflects the maturation of markets, infrastructure, and governance frameworks that are collectively fostering a robust, compliant, and scalable ecosystem suitable for mainstream institutional participation.
Merging Institutional DeFi Narratives: Tokenized Securities, Perpetuals, and Custody
A central theme in 2024 is the mainstream adoption of regulated, on-chain tokenized securities and perpetuals. Major exchanges such as Coinbase, Kraken, and Binance are pioneering this shift by launching tokenized stock products—offering fractionalized, 24/7 tradable equities that break free from traditional market hours. Kraken, in particular, has introduced regulated perpetual futures on tokenized U.S. stocks, enabling institutions to maintain continuous, global trading, thereby significantly enhancing liquidity and transparency.
Complementing these product launches, regulated tokenized bond platforms—notably in Hong Kong—are actively linking with regional hubs like Singapore and Shanghai to foster cross-border issuance and trading. These initiatives aim to bring transparency and trustworthiness to formerly opaque markets, making real-world assets (RWAs) such as bonds, real estate, aircraft engines, and commodities more accessible on-chain. Platforms like OnDo are expanding partnerships to facilitate issuance and trading of these assets, effectively unlocking liquidity and diversification for institutional portfolios.
Custody and compliance solutions are evolving rapidly to support this infrastructure. Firms such as Taurus are integrating on-chain lending infrastructure and regulatory-compliant custody, ensuring that assets are held securely and in accordance with emerging frameworks. Binance's integration of Ondo’s tokenized stocks exemplifies a strategic move to bridge traditional securities with DeFi infrastructure, cementing RWAs as trustworthy, liquid assets suitable for large-scale institutional portfolios.
Regulatory Clarity and Security Enhancements
As institutional involvement deepens, regulatory clarity around tokenized assets and DeFi activities remains a priority. The SEC’s hiring of a former Chainlink executive signals a focus on oversight of oracles, smart contracts, and tokenization frameworks, providing much-needed certainty. Jurisdictions like Switzerland, Singapore, and the EU are actively developing tailored regulatory frameworks, fostering an environment where innovation and compliance coexist.
Simultaneously, security tooling has advanced to mitigate risks associated with complex on-chain operations. Protocols like ZetaChain 2.0 support privacy-preserving, cross-chain transfers, essential for regulatory compliance and borderless institutional transactions. Industry efforts have intensified around formal verification, AI-powered threat detection, and insurance solutions—notably AgentCover Pro—aimed at preventing breaches like the Moonwell hack and the CrossCurve bridge attack. These measures bolster trust in the ecosystem, encouraging institutions to participate more confidently.
On-Chain Settlement Infrastructure and Stablecoins
Stablecoins have become the backbone of on-chain liquidity and settlement, with estimates from Standard Chartered suggesting that $1 trillion in stablecoins could soon be systemically important for cross-border payments and sovereign debt management. Protocols such as FIDD facilitate rapid, cross-border settlements, reducing reliance on traditional banking rails and minimizing counterparty risks.
Innovations like trustless cross-chain transfer protocols—including ZetaChain—are reducing attack vectors associated with centralized bridges, further enhancing stability and security for large institutional transactions. These developments are laying the groundwork for a dependable, scalable, and compliant on-chain settlement system that seamlessly supports deep institutional integration.
Rise of AI-Driven Automation and the Agent Economy
AI is revolutionizing DeFi operations by enabling autonomous market participation, portfolio management, and value transfer. MoonPay’s MoonPay Agents now leverage AI-powered autonomous capabilities to browse, execute microtransactions, and manage portfolios automatically, supporting continuous, programmable economic activity.
Research indicates a growing prevalence of wallets operated by AI agents, raising new legal and custody considerations. Industry players are responding by developing governance frameworks and custody solutions to responsibly manage AI liabilities. Platforms like Uniswap have deployed seven AI agent skills, automating trading, liquidity provisioning, and market rebalancing, which results in operational efficiencies and more resilient markets.
However, incidents such as the OpenCLAW breach—where out-of-control AI agents caused significant financial damage—have underscored the importance of security, formal verification, and regulatory oversight. These events have spurred initiatives to implement formal verification tools, standardized interaction protocols (e.g., ERC-8004), and insurance products like AgentCover Pro—all aimed at safeguarding autonomous systems and building confidence among institutional stakeholders.
Ecosystem Initiatives and Standards for Privacy and Interoperability
To support large-scale institutional adoption, ecosystem projects are emphasizing privacy-preserving, permissionless protocols and interoperability standards. The Ethereum Foundation continues to support privacy-focused DeFi, enabling institutions to operate confidentially and compliantly. Protocols like DFlow’s Universal Multi-Chain Protocol (MCP) facilitate trustless, multi-chain interactions, vital for cross-border and multi-ecosystem operations.
Developments in autonomous, verifiable AI interactions—such as ERC-8004—are designed to respect privacy while automating compliance, underpinning the next generation of automated, trustworthy DeFi services.
Industry Momentum: Traditional Finance and Institutional Entrants
The broader industry is witnessing growing interest from traditional finance giants. KuCoin’s announcement of onboarding multiple enterprise clients and BlackRock’s continued innovation with new RWA products exemplify this trend. These moves reflect a recognition of DeFi’s potential to enhance liquidity, transparency, and operational efficiency, as well as the necessity of robust custody, compliance, and security solutions.
Looking Ahead
2024 marks a pivotal year where DeFi’s institutional capabilities are becoming increasingly integrated, secure, and compliant. The merging of tokenized RWAs, regulated perpetuals, and custody solutions signals a shift toward mature, trust-minimized markets. The rise of autonomous AI agents, supported by security protocols and insurance, is paving the way for auto-economies that operate seamlessly across borders and asset classes.
The continued development of privacy protocols, interoperability standards, and regulatory frameworks will be critical in accelerating adoption. As institutions and DeFi coalesce into a resilient, scalable system, the vision of a global, transparent, and autonomous financial infrastructure becomes increasingly tangible—heralding a new era of trust, efficiency, and systemic stability in the digital economy.