According to foreign media reports, Ben Nadareski, co-founder and CEO of Solstice Labs, believes that the crypto market is undergoing a narrative shift. The two narratives that Bitcoin previously relied on—"store of value" and high-volatility speculation—are weakening, while the truly sustained expansion is occurring more in the less-discussed DeFi sector.
Bitcoin narrative loses appeal
In an interview with CoinDesk, Nadareski stated that Bitcoin is experiencing an "identity crisis." In his view, Bitcoin has not yet been as widely accepted as a stable store of value as gold, and it no longer possesses the inherent allure of high-risk speculation that it once did.
He believes that while mainstream attention remains focused on Bitcoin and a few core assets, some DeFi platforms are quietly expanding, and the industry's center of gravity is subtly shifting.
Security incidents erode institutional trust
The article points out that DeFi's growth is not stable, and persistent vulnerabilities and attacks remain the biggest obstacles. Nadareski attributes the problem partly to the development culture: many teams focus on rapidly releasing new code, neglecting the fact that the platform is essentially managing user funds.
He stated that DeFi developers cannot simply view themselves as technical personnel, as on-chain financial products carry both technical and financial risks. If platforms wish to attract larger amounts of funding, they need to design their systems to the standards of financial infrastructure, rather than simply aiming for "the code to be live."
Last month, Manuel Aráoz, co-founder and former CTO of OpenZeppelin, also stated that AI coding agents are exposing smart contracts to higher risks. Regarding security incidents, Drift Protocol and Kelp DAO suffered attacks from North Korean hackers in April of this year, resulting in a combined loss of nearly $600 million. Earlier, Bybit suffered an attack in February 2025 that cost approximately $1.46 billion, considered the largest hack in the history of the crypto industry.
He advocates for higher standards of transparency.
Nadareski believes that to repair this trust gap, DeFi platforms need to adopt risk control and transparency standards closer to those of traditional banks, including real-time proof of reserves and automated multi-signature time lock mechanisms, rather than continuing to rely on an unproven code layer.
In his view, the entry of traditional financial institutions into the on-chain market does not mean that native crypto teams will be squeezed out. A more likely scenario is that Wall Street will leverage faster digital infrastructure to handle back-office operations, while decentralized platforms will retain the ability for users to access the platform directly.
He believes that a more competitive platform in the future needs to meet two requirements: first, it needs to be able to accept funds and meet compliance requirements from large financial institutions; and second, it needs to maintain low fees and provide equal access to ordinary users.
- Solstice has locked over $500 million in total value since its launch.
- Funds came from more than 40 institutional investors.
- Disclosed partners include Galaxy Digital and Susquehanna.
Solstice discloses progress of cooperation
Nadareski also mentioned that Solstice has established a strategic partnership with the big data analytics platform ApexE3, which is supported by Consensys and Tensorix.
The article argues that if DeFi continues to be treated as a technological testing ground rather than financial infrastructure, its institutionalization process will remain limited. Nadareski's core judgment is that if on-chain finance wants to expand its user base, it must set higher standards than traditional finance in terms of transparency, trust, and the efficiency of fund utilization.
