What are the truly valuable crypto assets when the narrative bubble fades?

Written by: FinTax

1 Introduction

In scenarios such as cross-border payments, asset preservation, and capital flows, the applicability of different financial instruments and institutional arrangements becomes more apparent under high uncertainty environments. Compared to traditional settlement systems relying on centralized intermediaries, on-chain assets inherently possess features like cross-border transferability, self-custody, and limited dependence on a single institution. Therefore, in contexts such as sanctions, hyperinflation, or capital restrictions, they are more easily used for value transfer, risk buffering, and asset allocation.

For example, in Iran, under external extreme pressure, the Iranian rial’s USD exchange rate in the open market plummeted 30-fold. Under macro shocks, on-chain assets with cross-border transferability, self-custody, and resistance to single-point freezing quickly became channels for risk buffering and capital substitution for cross-border traders and local residents. Chainalysis research shows that by 2025, Iran’s crypto ecosystem reached approximately $7.78 billion, with on-chain activity highly correlated with major macro events. However, the cross-border flow of such assets also involves significant compliance risks. Their censorship-resistant features provide user autonomy but may also facilitate illegal fund flows. Balancing innovation and regulation remains a key challenge for global policymakers.

Short-term “channel value” amid macro fluctuations cannot conceal the deep value differentiation in the crypto market. The long-term blind expansion of token supply and the rapid demise of numerous projects form a stark contrast: CoinGecko Research data indicates that over 13.4 million crypto projects listed at some point have ultimately ceased trading and are considered failures. This large “death list” reveals that assets driven solely by issuance, fundraising, and narratives lack a sustainable consensus; market funds and liquidity will ultimately converge toward a few assets with sustainable value mechanisms.

Against this background, this paper focuses on the “value mechanism” as the core, first exploring which tokens can maintain sustainable value across cycles under economic policy uncertainty and cross-border economic activities; second, analyzing why global digital finance evolution inevitably involves a progression from governance of fundraising chaos, to market infrastructure governance, and then to classification rules and data reporting.

2 Theoretical Foundations

2.1 The Definition of Tokenization and Three Fundamental Proofs

The World Economic Forum (WEF) in its 2025 report defines “tokenization” as: the process of representing asset ownership in a transferable digital format using programmable ledgers. Unlike traditional financial systems relying on fragmented external messaging (such as SWIFT), tokenization theoretically constructs a shared record system (Shared System of Record), combined with smart contracts to enable unified records, flexible custody models, and on-chain governance.

The Bank for International Settlements (BIS), in its “Unified Ledger” blueprint, further states that tokenization integrates information transfer, reconciliation, and settlement into a seamless single operation. This architectural leap significantly reduces trust friction and compliance costs in cross-border commercial cooperation. Its theoretical framework is based on three proofs: first, Proof of Value—assets must have verifiable value backing, either through cash flows from the real economy or broad network consensus, ensuring they are not mere narrative bubbles; second, Proof of Ownership—ownership rights must be clear, directly assigned to legitimate holders, with cryptographic exclusivity on distributed ledgers, avoiding reliance on centralized intermediaries and reducing tail risks like freezing or misappropriation; third, Proof of Transaction—transactions must generate immutable, verifiable history and settlement evidence, enabling full traceability of cross-border capital flows for compliance audits and transparent regulation.

These three proofs form the logical starting point for reconstructing financial infrastructure via tokenization: Proof of Value establishes issuance basis, Proof of Ownership reconstructs property rights, and Proof of Transaction reshapes trust mechanisms in clearing and settlement.

2.2 Two Core Token Models: Native and Supported

Current tokenization models in value capture mechanisms mainly fall into two categories: Native Tokens and Backed Tokens. Their ability to traverse macro cycles varies significantly, rooted in their different value anchors.

Native tokens are assets issued directly on the chain, with embedded issuance, transfer, and ownership records. Examples include Ethereum’s native token ETH. These assets are typically not pegged to physical assets; their core functions are as settlement media within the network and as “security budgets” to maintain decentralized system operation. Specifically, native tokens incentivize network nodes via economic models (e.g., Proof of Stake) to maintain consensus, and serve as network fees (Gas Fees) for executing smart contracts and complex logic. Their sustainable value depends on whether the network can continuously reduce friction in real economic activities—value is derived from network utility and activity frequency. In short, the value anchor of native tokens is network utility.

Supported tokens are also issued and circulated on-chain but are strictly pegged to off-chain assets. Their primary purpose is to bring real-world financial yields onto the chain. In today’s uncertain macro environment, supported tokens demonstrate strong practical value—for example, tokenizing high-liquidity assets like U.S. Treasuries provides 24/7, divisible global liquidity and offers a risk-free yield benchmark outside volatile crypto markets. For enterprises with international operations, this enables efficient liquidity management, hedging against local currency depreciation, and reducing cross-border friction. The value anchor of supported tokens is the value of the underlying off-chain assets.

The fundamental difference is that native tokens derive their value from network endogenous factors, with sustainability depending on the ecosystem’s ability to create cost reductions and efficiency gains; supported tokens derive value from the mapped off-chain assets, with sustainability depending on the credit quality and repayment capacity of the pegged assets.

3 Economic Analysis of Sustainable Token Value

After multiple bull and bear cycles, the crypto market is experiencing a deep return to fundamental value. CoinGecko data shows that over 13.4 million projects driven solely by issuance, fundraising, and narratives have ultimately ceased trading. This “death list” reveals a basic rule: speculative assets lacking underlying assets and real use cases cannot sustain market consensus during macro liquidity downturns.

From an institutional economics perspective, for a token to have cyclically sustainable value and withstand macro shocks, it must substantially reduce friction costs in real economic operations and establish a solid rights structure. This sustainable value can be analyzed along three dimensions.

3.1 Macro Hedging

Enterprises engaged in international expansion and cross-border trade rely heavily on stable, low-friction cross-border payment networks. However, traditional correspondent banking, with its lengthy clearing chains and complex compliance nodes, creates significant institutional friction. As of Q1 2025, the World Bank reports that the average global remittance cost remains high at 6.49%, with explicit fees via traditional banks averaging 12-13%. Cross-border remittance costs vary across regions (see Table 1). Moreover, macroeconomic instability causes some regions’ remittance costs to rise. The BIS’s “Agorá Project” highlights that current cross-border payment systems face challenges, but tokenization can integrate information transfer, reconciliation, and settlement into a seamless operation.

Data source: RemitBee

When macroeconomic policy uncertainty spikes—such as extreme capital controls, sanctions, or disconnection from SWIFT during crises—traditional cross-border capital flows face high implicit and explicit costs, and the risk of funds being frozen at any time. In such cases, the value of tokens first manifests as their capacity to serve as independent, censorship-resistant macro hedging channels.

Chainalysis’s global macro data confirms this: in regions under extreme stress from inflation or geopolitical conflicts, retail and corporate users tend to convert large funds into supported stablecoins like USDT or USDC to maintain supply chain operations and hedge rapid local currency depreciation. These on-chain assets issued on programmable ledgers, with self-custody mechanisms, give control back to end-users and cut reliance on centralized financial intermediaries. For cross-border entities, such a globally liquid on-chain value network becomes a buffer against macro tail risks.

3.2 Anchoring Real Yields

The demise of countless “air coins” proves that purely community sentiment-driven and Ponzi-like token economies cannot last. WEF emphasizes that sustainable tokens must embed clear “Embedded Rights”—immutable code-level rights granting holders legitimate economic and governance entitlements.

Market funds are visibly migrating toward assets with “real yields.” WEF reports that in 2024, the total transfer volume of supported tokens like stablecoins reached $27.6 trillion, surpassing Visa and Mastercard transaction volumes combined, with stablecoin market cap steadily rising since 2020 (see Figure 1). From a macro capital efficiency perspective, there is about $230 trillion in potential collateral pools globally, but due to inefficiencies and time delays in traditional finance, only about $25 trillion of securities are actively used as collateral.

Tokenizing high-quality liquid assets (HQLA), such as U.S. Treasuries, not only enables 24/7, divisible global transfer but also directly introduces risk-free yields from the real economy onto the chain. This valuation anchor detaches from pure crypto speculation, aligning supported tokens’ value logic with classical financial valuation models, providing new liquidity tools for corporate treasury management. Market data supports this: during macro volatility, the circulation and trading of compliant stablecoins increase significantly, reflecting market demand for “verifiable value anchors.” IMF’s 2025 research indicates that tokenizing central bank reserves is key to maintaining the core settlement function of central bank money in the digital asset ecosystem, essentially migrating existing reserve systems into technological infrastructure rather than creating new liabilities.

Figure 1: Total Market Cap of Stablecoins (2020-2025)

Data source: CoinLedger

3.3 Reducing Friction and Costs

In micro-level corporate operations and financial settlement cycles, the core value of sustainable tokens lies in reconstructing contract execution efficiency. Traditional capital markets involve time-consuming processes like dividend payments, stock splits, and voting, often leading to information asymmetry and reconciliation errors due to unstructured data.

Smart contracts’ programmability offers a new paradigm: immutable code prevents unilateral rule changes, and standardized operations reshape business trust. Corporate actions such as KYC/AML compliance, complex asset servicing, and automated profit distribution can be encoded as executable programs. Furthermore, smart contracts enable “Atomic Settlement” (DVP—Delivery Versus Payment), fundamentally eliminating reconciliation friction and counterparty risk in cross-border cooperation.

Thus, native tokens establish their sustainable value as “system security budgets” and network fuel (Gas Fees) for maintaining efficient, secure decentralized ledgers. This value logic is validated by market data: on Ethereum and similar chains, network activity and native token consumption are highly correlated, and ecosystem prosperity directly translates into value capture. As long as the underlying blockchain can continue to deliver real reductions in costs and efficiency for cross-border payments, supply chain finance, and settlement systems, the value cycle of native tokens can sustain a self-reinforcing flywheel.

4 Governance of Market Chaos and Infrastructure Building

If the underlying programmable mechanism of tokens determines their intrinsic value across cycles, then the evolving regulatory framework defines their boundaries and compliance costs within the modern macroeconomic system. PwC’s annual regulatory report notes that regulation is no longer merely constraining but actively reshaping markets, enabling responsible expansion of digital assets. Globally, crypto asset regulation has evolved through clear stages: from “governance of fundraising chaos,” to “market infrastructure governance,” and then to “classification rules and data reporting.” The core driver is that as market scale and asset complexity grow, the contagion pathways of financial risk shift from isolated crypto ecosystems to traditional cross-border capital flows and macro financial stability.

4.1 Evolution of Regulatory Pathways Over Time

From the perspective of cross-border capital flow lifecycle, regulatory evolution is a reactive and proactive response to emerging risks at different stages, which can be divided into three phases:

4.1.1 First Stage: Governance of Fundraising Chaos

In early development, the market was flooded with narrative-driven projects. Due to vague asset definitions and lack of real economic cash flows, financial risks mainly manifested as regulatory arbitrage, illegal fundraising, and investor rights violations. Many projects failed shortly after trading began. In response, regulators focused on cutting off unregulated exchanges between fiat and unbacked tokens to prevent illegal capital outflows and systemic disruptions. This phase is characterized by “containment regulation”—aimed at preventing risk spillover.

4.1.2 Second Stage: Market Infrastructure Governance

As the ecosystem matured, centralized exchanges (CEXs) and custodians grew rapidly, creating concentration risks. These institutions often lacked proper regulation, with issues like fund commingling and poor internal controls. During macro shocks or liquidity crunches, these nodes risk triggering bank-run-like events, with strong procyclical effects. Regulatory focus shifted to strengthening infrastructure resilience—mandating asset segregation (bankruptcy remoteness) and third-party custody to prevent systemic risk transmission from failures. This stage is marked by “systematic regulation”—importing traditional financial infrastructure standards into crypto.

4.1.3 Third Stage: Classification Rules and Data Reporting

When blockchain technology is integrated into mainstream finance to reduce cross-border friction, regulation enters complex territory. Authorities recognize that a one-size-fits-all approach is inadequate. Regulations like the EU’s Markets in Crypto-Assets (MiCA) and Liechtenstein’s Token and Trusted Technology Service Providers Act (TVTG) classify tokens as “Containers of Rights,” applying tailored regulation based on their economic features. Simultaneously, regulators accelerate digital and API-based data reporting, enabling real-time, comprehensive on-chain and cross-border monitoring. This phase is characterized by “embedded regulation”—integrating compliance into the technical layer.

4.2 Differentiated Regulation Based on Token Value Types

Regulators adopt tailored compliance requirements and policies for tokens with different value anchors.

Native tokens are primarily regulated to enhance network resilience and anti-money laundering (AML) penetration. Non-anonymous crypto assets, with their potential AML advantages, tend to have higher market caps than anonymous counterparts. Native tokens, with on-chain issuance and settlement, feature decentralization and pseudonymity, which can be exploited for regulatory evasion. FATF’s updated guidelines emphasize AML transparency for Virtual Asset Service Providers (VASPs). For native tokens and their service providers, regulation relies heavily on on-chain analytics and enforcement of the FATF Travel Rule, requiring the recording of bilateral identity information—achieved through service providers without compromising decentralization.

Supported tokens are regulated based on their linkage to off-chain assets, focusing on audit and liquidity management. Their value depends on the integrity of the off-chain collateral. Risks include potential de-pegging due to mismatched timing or reserve value. U.S. regulators, such as the SEC and OCC, have proposed rules requiring stablecoin issuers to hold 100% reserves of high-quality liquid assets (HQLA), undergo regular independent audits, and maintain over-collateralization. These standards bring traditional financial asset audit rigor into the blockchain, providing credit backing for on-chain value.

4.3 “Code as Regulation”

For high-frequency, complex cross-border transactions, traditional post-facto enforcement faces high costs and delays. To balance capital efficiency and financial security, regulators are actively promoting “regulatory rule coding”—embedding compliance into smart contracts.

Protocols like ERC-3643 (T-REX) enable compliance rules—such as KYC/AML, sanctions screening, and jurisdictional transfer limits—to be hardcoded into tokens. If a transaction violates pre-set whitelist conditions or triggers sanctions blacklists, it is automatically blocked at the protocol level. This transformation of legal logic into immutable code infrastructure significantly reduces compliance costs and provides a robust foundation for legitimate cross-border capital flows during macro shocks. It marks a fundamental shift from “post-event accountability” to “pre-embedded compliance.” The DFCRC estimates that with clear regulation, tokenized finance could generate hundreds of billions of AUD in economic benefits for Australia, highlighting the importance of regulatory infrastructure development.

5 Summary and Outlook

Tokenization technology is driving a fundamental reconstruction of the global financial infrastructure, with macro geopolitical conflicts and persistent economic policy uncertainties serving as stress tests for this emerging value carrier. During periods of volatility, speculative narratives and unanchored assets are gradually stripped away, with market liquidity and attention converging toward tokens backed by real value.

This research indicates that truly cyclically resilient, sustainable tokens typically possess several key features: first, they provide real yield anchors by bringing off-chain credit into on-chain assets; second, they substantially reduce cross-border contract execution costs through programmability, reshaping business trust; third, they serve as decentralized network security budgets, with value sedimented in ecosystem activity and efficiency gains. These tokens are not detached speculative symbols but embedded in real economic activities, capable of supporting specific functions, revenue streams, or rights arrangements.

Currently, global regulation has shifted from passive containment to proactive, embedded rule-building. Through classification and code-based compliance, high-quality digital assets are being prudently integrated into mainstream settlement systems.

In face of this irreversible trend, the following recommendations are proposed:

For enterprises: view on-chain assets as infrastructure tools to enhance global capital turnover efficiency. In cross-border settlement, prioritize compliant stablecoins to hedge currency risks and reduce institutional friction; distinguish sharply between highly volatile native tokens and strictly regulated supported tokens, adopting differentiated management strategies.

For issuers and financial institutions: abandon the outdated “issuance-as-fundraising” paradigm. Focus on “embedded rights”—defining asset attributes clearly and immutably in smart contracts, adopting compliant token standards like ERC-3643, and providing transparent, auditable proof of value and real reserves.

For policymakers: adopt a technology-neutral, cautious approach, promoting “compliance-as-code” regulatory innovation. Under the premise of preventing AML and systemic risks, foster multilateral consensus-based unified ledgers, integrating national credit with programmable technology to build next-generation financial infrastructure suitable for the digital economy.