The Expansion of On-Chain Finance: The Era of Integration between Traditional Capital and DeFi

In the process of transitioning from frenzy to rationality in the cryptocurrency market, and from conceptual speculation to value accumulation, the blockchain ecosystem is quietly undergoing a qualitative change. Over the past few years, DeFi (Decentralized Finance) has reshaped the rules of traditional finance with permissionless financial protocols, allowing capital to flow freely across the globe. Meanwhile, the exploration of RWA (Real World Assets) on the blockchain is attempting to bridge the gap between the traditional financial system and the blockchain world, mapping trillions of dollars of real assets onto the chain and further releasing financial efficiency.

In this transformation, the flow of capital often hints at future trends. Recently, the frequent investments by WLFI, a company under former U.S. President Donald Trump's family, in the blockchain space have become a focal point in the market. Particularly, the continued investment in the SEI network not only reflects WLFI's long-term optimism towards the DeFi and RWA sectors but also indicates that traditional capital is accelerating its penetration into the on-chain world, injecting new narratives and confidence into the cryptocurrency market.

Trump's Family Bet: The Resonance of Capital, Technology, and "Political Premium"

According to on-chain data, WLFI has made several significant purchases on the SEI network, with a total investment exceeding $225,000 in SEI tokens in just the past two months. Notably, WLFI is not merely a financial investor; the political influence of the Trump family behind it gives these actions a deeper significance in the market.

In the crypto world, capital inflows often represent a bet on future expectations. When such inflows come from capital closely related to U.S. politics, they are more easily interpreted as a form of "political endorsement." The Trump family's favor towards SEI not only adds capital strength to SEI but also implicitly attaches a "political premium," attracting more attention from traditional investors.

However, WLFI's entry is not a blind pursuit of profit but a strategic choice based on SEI's technological advantages and ecological potential in the DeFi and RWA fields. SEI is becoming a hotbed of "new infrastructure" in the DeFi and RWA sectors due to its high throughput, low costs, and financial-grade infrastructure.

Technical Field: High Throughput + Low Cost, The Ideal Soil for DeFi and RWA

In the process of on-chainization of DeFi and RWA, the performance and cost of public chains are crucial. SEI's core advantage lies in its efficient and low-cost trading environment, making it an ideal platform for financial-grade applications:

5 Gigas per second throughput: SEI can process thousands of transactions per second, far exceeding Ethereum and most public chains. This high performance gives it a significant advantage in high-frequency trading and liquidity protocols, especially suitable for high-frequency clearing scenarios in DeFi.

Native trading matching engine: SEI's built-in on-chain trading matching mechanism optimizes order execution efficiency, significantly reduces slippage, and enhances capital utilization. This technological advantage makes it more competitive in on-chain order book DEX and RWA asset settlement.

Extremely low transaction costs: SEI's gas fees are far lower than Ethereum's, allowing DeFi and RWA projects to operate at a lower cost, attracting a large number of developers and institutions to settle in.

These series of technical features not only make SEI stand out in the DeFi sector but also provide a solid foundation for the on-chain mapping and circulation of RWA assets.

DeFi Explosion: Focus on Ecological Data

SEI's DeFi ecosystem is experiencing explosive growth. According to the Q4 data report released by Messari, SEI's on-chain trading volume reached approximately $1 billion in Q4 2024, with 65% coming from DeFi protocols. The TVL (Total Value Locked) increased by 3830.9% year-on-year, reaching $250 million. This indicates that even in a market environment with price fluctuations, real capital inflows on SEI are still significantly rising.

In terms of specific protocol performance, the DeFi activity in the SEI ecosystem continues to rise:
DragonSwap: As the flagship DEX of the SEI ecosystem, its daily trading volume grew by 815.9% in Q4, surpassing $10.1 million, with market activity continuously climbing.
Yei Finance: SEI's native lending protocol, which accounted for 88.7% of SEI's DeFi Active Addresses (DAA) in Q4, with a TVL exceeding 21 million SEI, becoming one of the largest DeFi platforms on the SEI chain.
Pit Finance: As a yield aggregator, its TVL reached $12.3 million at the end of Q4, demonstrating strong capital attraction.

It is worth noting that although SEI's token price fell by 14.4% in Q4, the TVL measured in SEI increased by 17.1%, indicating that more capital is continuously flowing into the SEI on-chain DeFi ecosystem. This positive cycle of capital and applications not only strengthens the financial foundation of the SEI ecosystem but also holds the potential to further support the value recovery of SEI tokens.

RWA Financialization: Bridging On-Chain and Off-Chain Assets

Beyond DeFi, SEI is accelerating the on-chain layout of RWA assets, building a connector between the real world and on-chain finance. In SEI's RWA ecosystem, several projects are exploring application scenarios for on-chain financial assets:
Elixir: Introduced fastUSD into the SEI ecosystem, providing on-chain stablecoin settlement services for RWA assets, enhancing the stability and reliability of on-chain financial transactions.
Filament Finance: Through on-chain liquidity protocols, it provides more efficient trading and clearing capabilities for RWA assets, accelerating the mapping and circulation of traditional financial assets onto the chain.

At the same time, mainstream trading platforms are also increasing their investments in the SEI RWA sector. The $1.5M SEI DeFi Season event initiated by Binance Wallet has attracted significant attention from many TradFi (traditional finance) institutions. This indicates that SEI's layout in the RWA field is gradually gaining favor from traditional capital.

Future Outlook: The Potential of On-Chain Financial Infrastructure

With the parallel explosion of DeFi and RWA, SEI is gradually establishing its position as an on-chain financial infrastructure, leveraging its strong technical foundation and ecological growth. In the future, with the launch of the Giga upgrade, SEI's trading throughput will increase by 50 times, further enhancing its competitiveness in financial-grade applications.

WLFI's continued bet on SEI not only recognizes its technological potential but may also signal a deep integration of on-chain finance and traditional capital on the SEI network. As the mapping of RWA assets onto the chain accelerates, SEI is expected to become a core bridge between traditional finance and the DeFi world, playing an increasingly important role in the global financial landscape.