Wintermute: 2026 The seven key areas we will focus on investing in

Wintermute

Compiled by: Ken, Chaincatcher

For decades, the internet has enabled information to flow freely across borders, platforms, and systems. However, the transfer of value has lagged behind. Money, assets, and financial protocols still circulate through fragmented infrastructure built on outdated rails, national borders, and intermediaries, all of which seek rent at every stage.

This gap is narrowing at an unprecedented pace. It creates opportunities for companies that can directly replace traditional clearing, settlement, and custody functions. Infrastructure that allows value to flow as freely as information is no longer just theoretical; it is being built, deployed, and adopted at scale.

For years, the crypto space has primarily existed on-chain, disconnected from the real economy. That is changing. Cryptography is becoming the settlement and clearing layer that the internet economy has long desired—a 24/7, transparent, permissionless system.

The following themes represent our predictions for the development of digital assets by 2026, and the directions that Wintermute Ventures is actively supporting among founders.

Everything Can Be Traded

Through new financial primitives like prediction markets, tokenization, and derivatives, more and more assets and real-world outcomes are becoming tradable. This shift provides liquidity layers for historically illiquid sectors.

Tokenization and synthetic assets bring liquidity to known assets. Prediction markets go further, pricing previously unpriceable things and transforming raw information into tradable tools.

Prediction markets will continue to expand as consumer products and new financial instruments, supporting hedging, outcome-based trading, and expressing views on granular events. They are also beginning to replace parts of traditional financial infrastructure.

Insurance is a compelling example: outcome-based markets can offer cheaper, more flexible hedging by directly pricing specific risks rather than bundling them into broad products. Users won’t need to buy hurricane insurance covering entire regions; instead, they can hedge against specific wind speeds at specific locations and times. Over longer periods, through smart agent workflows, these tailored risks can be curated and bundled to meet individual needs.

As prediction market infrastructure scales, entirely new data product categories will emerge around topics that have never been priced before. We expect markets specifically designed for trading and quantifying perceptions, sentiment, and collective opinions on objective indicators. These emerging markets are a natural extension of decentralized finance, unlocking new ways to price and exchange information itself. When everything can be traded, infrastructure that provides liquidity, price discovery, and settlement becomes critical.

This structural shift will concentrate value at the infrastructure layer, directly reshaping capital allocation. We are actively supporting the development of core markets and settlement infrastructure, data layers for verification and proof, and new data products emerging to support previously untradeable outcomes. We are also focused on novel abstract models that make these markets programmable and composable, enabling integration into real-world workflows and replacing parts of traditional finance and insurance infrastructure.

Stablecoins as Trust Layers, Banks Handling Transitional Settlements

Digital assets lack the robust facilities—like settlement banks and clearinghouses—that serve as the lubricants of traditional finance. While stablecoins have achieved open access and programmable value, fragmentation caused by the absence of settlement infrastructure limits their application.

As stablecoin issuers adopt different collateral models across ecosystems, the need for an interoperable layer capable of reliably combining these assets is growing. To scale this system, the crypto industry needs infrastructure that can perform cross-stablecoin and cross-chain netting, exchange, and settlement without adding extra credit risk, liquidity risk, or operational overhead.

The missing abstraction is an asset-liability-based interoperability layer that transfers exchange and credit risk to stablecoin issuers, rather than forcing end users to manage FX, routing, or counterparty exposure during cross-stablecoin trades. We see this as an on-chain “agent bank” business capable of instant settlement and accessible to application builders. We expect more companies to position themselves as coordinators between issuers and applications.

Markets Will Favor Sustainable, Persistent Revenue Over Temporary Incentives

Token-driven growth without sustainable business models is losing its effectiveness. Companies relying on subsidies to users or liquidity providers, while operating fragile revenue structures, will find it increasingly difficult to compete.

Valuations will more closely anchor to sustainable earnings and forward-looking forecasts, aligning with cash flow-based frameworks. Short-term, volatile monthly fees are no longer reliable measures of enterprise value, as profit quality and incentive alignment become central. Without a dependable value capture path, demand after the speculative phase will diminish.

Consequently, companies issuing tokens early on will reduce their issuance. Many will default to “equity-first” structures, primarily using blockchain as backend infrastructure, which remains largely invisible to users and investors. Even when tokens are issued, the trend will favor issuance after product-market fit is confirmed—once revenue, unit economics, distribution channels, and stakeholder incentives are aligned.

We see this as a healthy, necessary evolution that benefits the entire ecosystem. Founders can focus on building sustainable businesses rather than prematurely prioritizing token incentives and demand. Investors can evaluate companies using familiar financial frameworks. Users will access products designed for long-term value.

DeFi Will Merge with Fintech

The future of finance isn’t DeFi versus traditional finance—it’s their integration. A dual-track architecture allows fintech applications to route transactions dynamically based on cost, speed, and yield considerations. Breakthrough consumer applications will resemble traditional fintech products, with underlying layers like wallets, bridges, and blockchains fully abstracted. Capital efficiency, yields, settlement speed, and transparent execution will define the next generation of financial products.

As user experience merges with fintech, the underlying infrastructure continues to expand rapidly. Tokenization and highly composable financial primitives drive this growth, enabling deeper liquidity and more complex financial products.

Distribution capability will become more important than interface ownership. Successful teams will build “backend-first” infrastructure that integrates with existing platforms and channels, rather than competing as standalone apps. Personalization, automation, and increasingly advanced AI will improve pricing, routing, and yield behind the scenes. Users won’t consciously choose DeFi; they will choose better, more user-friendly products.

Privacy Becomes a Fundamental Requirement

Privacy is increasingly becoming a baseline for institutional adoption, shifting from a regulatory burden to a regulatory driver. Techniques like zero-knowledge proofs and multiparty computation enable selective disclosure, allowing participants to prove compliance without revealing raw data.

In practice, this means banks can assess creditworthiness without accessing transaction records, employers can verify employment without revealing salaries, and financial institutions can demonstrate reserves without disclosing holdings. The real-world extension of this vision is that companies no longer need to store vast amounts of data, freeing them from costly, cumbersome data privacy regulations. Technologies like private shared state, zero-knowledge transmission protocols, and multiparty computation unlock new on-chain structured finance activities—such as undercollateralized lending, layered financing, and novel on-chain risk products—that were previously impossible.

Regulation Shifts from Compliance Barrier to Distribution Advantage

Regulatory clarity has transitioned from an adversarial obstacle to a standardized distribution channel. While the early permissionless nature of DeFi remains a key driver of innovation, frameworks like the US Gensler Act, the European Markets in Crypto-Assets Regulation (MiCA), and Hong Kong’s stablecoin regime are providing greater clarity for traditional institutions. By 2026, the focus will no longer be on whether institutions can use blockchain but on how they leverage these guidelines to replace traditional infrastructure with high-speed on-chain channels.

These standards will foster more compliant on-chain products, regulated onboarding and offboarding pathways, and institutional-grade infrastructure—without forcing complete centralization—thus increasing institutional participation.

Regions that combine clear rules with rapid approval processes will attract more capital, talent, and experimentation, accelerating the normalization of on-chain value distribution in native cryptocurrencies and hybrid financial products. Conversely, slow-moving regulatory regimes will fall behind.

The Internet Economy Is Built on Cryptography

The maturation of infrastructure is the overarching theme of this transformation. Cryptography is becoming the settlement and clearing layer of the internet economy, enabling value to flow as freely as information. Protocols, primitives, and applications being built today are unlocking new forms of real-world economic activity and expanding possibilities online.

At Wintermute Ventures, we support founders building this infrastructure. We seek teams with deep technical expertise and strong product thinking. We look for those capable of delivering solutions users truly want. We favor teams that operate within regulatory frameworks while advancing core principles of decentralization. We support those capable of creating long-lasting business models with meaningful impact.

2026 will mark a turning point. For users, crypto infrastructure will increasingly operate behind the scenes, underpinning the global financial system. The best infrastructure is the one that quietly empowers people without seeking attention.