DeFi tokens are leading the crypto charge as markets position for expected Federal Reserve rate cuts, while bitcoin and ether hold modest gains ahead of U.S. labor revisions. Investors hunting yield are sending money into decentralized finance protocols that offer returns on otherwise idle crypto — a dynamic that could reshape flows if interest-rate expectations firm up.
Why DeFi is attracting cash
Unlike bitcoin, which is prized for scarcity but doesn’t generate yield, DeFi platforms provide interest via lending, staking and structured products. That makes DeFi tokens a natural beneficiary if weakening jobs data increases expectations of Fed easing. The CoinDesk DeFi Select Index (DFX) rose about 3% in 24 hours, while TradingView’s DeFi dominance climbed to 3.49%, the highest since early February.
Notable movers include HYPE (up ~9% in 24 hours, 22% over seven days) and MYX Finance’s native token MYX, which posted an extraordinary ~260% one-day gain alongside surging perpetual volumes. DeFi projects offering visible yields — for example Ethena’s sUSDe with a roughly 7% quoted yield — are being singled out by traders as rate-cut plays.
Altcoin themes and flows
Worldcoin (WLD) also stood out: a reported private-placement-led treasury strategy helped fuel a surge, with WLD up more than 50% in 24 hours and daily volumes spiking to about $3.7 billion. At the same time, spot BTC ETFs continue to pull capital: daily net flows were positive (roughly $364M), while spot ETH ETFs showed small outflows.
What to watch next
Market attention shifts to the U.S. Bureau of Labor Statistics’ preliminary payroll revisions and then U.S. producer and consumer price reports. If data show a deteriorating jobs picture, rate-cut bets could accelerate DeFi inflows. But if weak data arrives with signs of broader economic stress, investors may favor ultra-liquid, low-risk money market holdings instead.
Risk note: Rapid token rallies can reverse quickly. Watch token unlock schedules (several projects have multi-million-dollar unlocks this month) and derivative positioning that signals hedging demand. Yields cited on DeFi products are subject to protocol risk and market conditions.
Source: CoinDesk. Read the original coverage for full details.