The Bidirectional Integration of the Encryption Field and TradFi

In recent years, the boundary between the cryptocurrency field and the TradFi market has become increasingly blurred. Traditional investors who once scoffed at Bitcoin are now quietly paying attention to encryption assets. This change is not coincidental, but rather a result of multiple driving forces.

The White House, Wall Street, and regulators are beginning to actively engage in the encryption field, while encryption companies are also proactively seeking compliance and cooperation. As Bitcoin reaches new highs, the gap between encryption and traditional markets is gradually dissolving, with increasing two-way interactions.

TradFi Powers Enter the Encryption Field

This year, we have witnessed unprecedented attention from TradFi, political, and regulatory forces on the encryption market. Capital is actively positioning itself, policies are gradually loosening, and voters' attitudes are shifting. These "outsiders" are no longer just observers but are ready to participate fully.

In the US stock market, cryptocurrency concept stocks are performing actively. Several companies involved in holding Bitcoin, Ethereum, or related blockchain businesses have seen their stock prices rise significantly, gradually becoming the focus of the market.

There has also been a notable shift in attitudes within the political sphere. Some politicians have publicly expressed support for the development of encryption currencies and have even taken a series of practical actions to promote the industry. Congress is also actively advancing multiple pieces of encryption legislation, including a regulatory framework for stablecoins and an overall regulatory framework for encryption assets, providing a clearer policy environment for the industry's development.

TradFi institutions are accelerating their layout in encryption business. Several well-known internet brokerages have begun to test the waters for encryption asset trading services. Some large banks have also launched digital asset platforms aimed at institutional clients, providing physical delivery services for Bitcoin and Ethereum. In addition, some banks are researching the launch of stablecoins for internal settlements and client transactions.

Public companies' enthusiasm for the allocation of encryption assets is also on the rise. Some companies have already invested large amounts of funds into Bitcoin or Ethereum, treating them as primary reserve assets. This trend is gradually expanding.

TradFi products also open the door for encryption assets. U.S. regulators have approved the first batch of Bitcoin and Ethereum spot ETFs, allowing traditional investors to participate in encryption asset trading through familiar securities accounts, significantly lowering the entry barrier.

The encryption industry actively breaks boundaries

At the same time, the encryption industry is also working hard to expand its influence, trying to reach out to a broader mainstream world. This is mainly reflected in two aspects: brand cross-border cooperation and global compliance layout.

Encryption companies are actively leveraging mainstream entertainment and sports events to enhance brand awareness. From F1 racing to the Premier League, from Hollywood movies to the NBA courts, the presence of encryption brands can be seen everywhere. These cross-industry marketing efforts aim to bring encryption brands out of niche circles and into the public eye.

Compliance is another important direction for the cryptocurrency industry to break through its boundaries. Major cryptocurrency exchanges are applying for compliance licenses in key global markets to establish a legal operating framework. Some companies have already successfully gone public and obtained important licenses in multiple countries and regions; meanwhile, some emerging exchanges are also starting to pay attention to compliance issues and are striving to address their shortcomings. This is not only for legal operation but also to gain the trust and recognition of mainstream society.

In addition to brand promotion and compliance layout, the encryption industry is also focusing on product innovation. Some cryptocurrency wallets are striving to create a more user-friendly Web3 entry point, allowing ordinary users to easily experience blockchain services. At the same time, an increasing number of encryption protocols are beginning to promote the tokenization of real-world assets (RWA), enabling users to trade traditional financial assets such as stocks and bonds on the blockchain, providing a new way for global users to participate in the TradFi market.

A New Phase of Bidirectional Integration

The encounter between the encryption industry and TradFi is giving rise to a new pattern of bidirectional integration. Encryption technology is reshaping financial infrastructure, while the intervention of traditional forces is profoundly changing the ecology of the encryption field.

The rise of decentralized finance (DeFi) challenges the traditional banking business model. The application of stablecoins in cross-border payments and trade settlements demonstrates the breakthrough of encryption technology in traditional financial infrastructure. These innovations are driving the transformation of the underlying architecture of the financial system.

At the same time, the intervention of traditional forces is changing the landscape of the encryption field. Regulatory agencies are formulating regulations for cryptocurrencies, incorporating them into the existing regulatory framework. The large-scale entry of traditional capital may alter the distribution of pricing power and discourse in the market. Although these changes deviate somewhat from the original decentralized ideals of the encryption world, they are an inevitable path for the industry towards mainstream acceptance.

In this integration process, innovation and compliance are two key concepts. Continuous technological and model innovation is the fundamental driving force behind industry development, while actively embracing compliance is a necessary condition for building trust and gaining widespread recognition. Only by making efforts in both areas can the encryption industry truly break boundaries and integrate into a broader financial ecosystem.

In the future, we may see more TradFi institutions offering encryption services, encryption exchanges obtaining banking licenses, traditional assets being issued and traded on the blockchain, and encryption assets becoming a part of mainstream investment portfolios. Users will be able to freely allocate between encryption assets and traditional assets, while technology will ensure that these transactions occur in a secure and transparent environment. Such scenarios are already beginning to emerge and are expected to become the norm in the future.