DeFi Innovations Take Center Stage at BTCON Seoul 2025: Transforming Yield Strategies and Institutional Onboarding

The spotlight was firmly fixed on sustainable yield generation strategies at BTCON Seoul 2025 during a session titled “Stablecoins, DeFi, and Next-Generation Asset Management Strategies for Yield.” Held on September 5 and hosted by blockchain-centric media platform Digital Asset, the event gathered influential voices from the decentralized finance (DeFi) ecosystem and venture capital sectors. Moderated by Miki Ma, Head of Investments at global venture capital powerhouse L2IV, the discussion featured Justin Kim, Head of Asia at Ava Labs, Alex Im, Korea Lead at LayerZero, and Jerry, Co-Founder of Yield Basis.

The session tackled pressing challenges in the DeFi market while proposing forward-looking solutions for achieving consistent and sustainable returns. Key themes included institutional engagement in DeFi, the tokenization of real-world assets (RWA), and overcoming technical and regulatory barriers, marking a pivotal discussion for the industry’s future.

Avalanche: Unlocking Institutional DeFi Adoption

Justin Kim of Ava Labs exemplified how blockchain technology is being adopted by traditional financial institutions to unlock new opportunities. He pointed to the tokenization of a $300 million hedge fund by SkyBridge Capital on the Avalanche blockchain as a watershed moment. “This achievement demonstrates the speed and trust that blockchain can offer,” Kim stated.

Kim elaborated on Ava Labs’ multi-year relationships with heavyweight institutions such as KKR and BlackRock. “These partnerships validate the security and efficiency of blockchain technology,” he remarked, predicting that the tokenization of RWAs will soon provide safer, more appealing investment avenues, even for retail investors relatively new to crypto.

He stressed that Avalanche is laying the groundwork for financial products to migrate on-chain, offering unprecedented transparency and accessibility to investors at all levels. With institutional DeFi adoption ramping up, Avalanche intends to be at the forefront of integrating global financial markets with blockchain innovation.

LayerZero: Interoperability and Regulatory Stability as Pillars of Growth

Alex Im of LayerZero offered a pragmatic outlook on achieving sustainable yields in DeFi. “High APYs exceeding 20% are unlikely to be maintainable in the long term,” Im cautioned, citing the Terra-Luna collapse as a stark lesson in unsustainable models. He emphasized the importance of prioritizing real use cases, validating economic models, and tempering speculative short-term gains with long-term stability.

Im also discussed the increasingly competitive stablecoin market. “Success no longer hinges solely on token issuance; it’s about distribution strategies and user retention,” he argued. Addressing interoperability, he remarked that technical strides are mitigating cross-chain communication challenges, but regulatory constraints remain a significant hurdle.

However, Im expressed optimism about recent shifts in U.S. cryptocurrency regulations. “These advancements in policy have the potential to streamline regulatory frameworks and accelerate the mainstream adoption of stablecoins and tokenized RWAs,” he asserted, underscoring that a clearer regulatory environment could catalyze widespread stablecoin adoption and sustained growth.

Yield Basis: Tackling Impermanent Loss in AMMs

Jerry, Co-Founder of Yield Basis, focused on a critical technical challenge for Decentralized Exchanges (DEXs): impermanent loss. Yield Basis is innovating a new protocol on Curve to address this issue, aligning the value of deposited assets with their underlying prices at a fixed 1:1 ratio. This groundbreaking mechanism aims to mitigate risk for liquidity providers and encourage a renewed wave of investment.

“Understanding the origins of DeFi yields is fundamental,” Jerry stressed. He warned against opaque revenue models that could indicate underlying structural weaknesses within protocols. Transparent and predictable income streams are essential to the long-term viability of the DeFi ecosystem.

According to Jerry, impermanent loss has been a key factor in the stagnation of DEX total value locked (TVL) since the peak of the DeFi summer boom. Yield Basis’ protocol harnesses leverage to stabilize asset values, even amid market turbulence, enabling liquidity providers to earn without the risk of asset devaluation. This innovation is scheduled to launch later this month, setting the stage for a potential shift in AMM dynamics.

DeFi’s Emerging Paradigm: Institutionalization and Sustainability

The panel collectively envisioned a transformative future for the DeFi ecosystem, emphasizing a paradigm shift away from unsustainable high-yield pursuits toward a more stable and institutionalized framework. The integration of RWAs, coupled with technological advancements in interoperability and solutions to impermanent loss, is driving the sector’s maturation.

As institutional finance takes greater interest in DeFi and emerging regulatory clarity fosters trust, the ecosystem is positioned to deliver more sophisticated products tailored to both retail and institutional investors. With ongoing innovation and collaboration, DeFi is poised for sustainable long-term growth, opening new doors for global financial integration and economic inclusivity.