Crypto Yield Crisis: 90% of Digital Assets Sitting Idle - The Untapped Opportunity

The yield gap in cryptocurrency markets has reached staggering proportions - only 10% of digital assets are currently generating returns while the vast majority remain dormant.

The Passive Asset Epidemic

Nine out of every ten crypto holdings are sitting idle in wallets and exchanges, missing out on the burgeoning DeFi yield ecosystem. Staking, lending, and liquidity provision opportunities continue expanding, yet adoption remains surprisingly low among mainstream holders.

Traditional finance would never tolerate such inefficiency - but then again, traditional finance still thinks blockchain is just for buying coffee with Bitcoin.

The 10% that are working represent the vanguard of crypto's financial revolution, proving that digital assets can generate real yield without intermediaries. The remaining 90%? They're leaving billions in potential returns on the table while waiting for the next bull run to bail them out.

Yield-Generation in the Cryptocurrency Market Remains Consolidated

The development highlights that yield-generation in the cryptocurrency market is heavily consolidated. This is in sharp contrast with traditional finance, where 55% to 65% of the assets are yield-bearing instruments. The stock market also compounds faster, while the majority of cryptocurrencies barely deliver anything.

However, the Redstone report argues that the underdeveloped yield-generation in the cryptocurrency market is more of an opportunity than a bane.the report states.

Another negative of the cryptocurrency market is its sharp and extreme volatility. It can swing up dramatically within days, and also cut the gains in an hour. Not everyone can stomach high volatility, as it tests the nerves of investors. However, the entry of institutional funds in the digital assets sector has brought in a fresh sense of enthusiasm.

Moreover, institutional funds are only behind the assets that generate a 10% yield in the cryptocurrency market. That includes Bitcoin, Ethereum, and XRP, among others. They are also staying away from the rest of the market, which covers a major 90% of the sector.