BWR 2025 Theses

Multi-Product DeFi Beats Single-Product DeFi [Ryan]

Select DeFi apps will greatly expand their product offerings, resulting in a handful of DeFi super apps that take meaningful market share from single-product DeFi. We think there are two economic forces that dictate this: the benefits of increasing walletshare and capital efficiency. Coupled with a favorable regulatory environment in the US, we think these forces come to a head in 2025. 

First, DeFi protocols and DeFi users naturally benefit from increasing walletshare. DeFi protocols should expand walletshare naturally as financial products are highly complimentary. If you’re looking to swap, you probably want to borrow. If you risk manage perps, you’re probably looking to generate yield in money markets. Multi-product DeFi benefits the end user by decreasing the friction associated with managing risk and using financial products across multiple UIs, and benefits the protocol team by enabling cross selling opportunities and enabling customer lock-in, something that has been historically absent in DeFi, despite the fact that liquidity begets liquidity.

Next, multi-product DeFi enables capital efficiency. Historically, DeFi protocols like perps DEXs do not net position risk across distinct DeFi protocols, and cross margin is sorely lacking in both CeFi and DeFi. By allowing users to pool collateral across multiple products while netting offsetting positions, multi-product DeFi platforms can significantly reduce the total capital required to maintain equivalent positions, leading to more efficient use of capital across trading and lending.

Multi-product DeFi has a structural advantage for both retail and institutional end markets. On the institutional side, we think this product experience will be required by institutional capital that has been green lit to take crypto risk in 2025, as capital efficiency is table stakes. On the retail side, we think multi-product DeFi protocols are best positioned to capture walletshare, as this model is backward compatible with established retail consumer behavioral norms, and does not suffer from high cost-per-click, like much of DeFi today. 

AI Agent Creators Capture Mainstream Attention [Ryan]

The defining trend in media in the internet age has been the rise of creator and user generated content. Applications like Instagram, TikTok, and Youtube have taken mind and timeshare in media markets, largely driven by creators. Mega cap tech understands this, as evidenced by their multi-billion dollar creator funds aimed at ensuring creator loyalty. We think AI Agent creators with crypto tokens take a slice out of this market and capture mainstream attention in 2025.