Chainlink Cofounder Says Crypto Cycles Prove Institutional Maturity and RWA Momentum

• Chainlink’s Sergey Nazarov says this cycle lacks system-wide failures seen in the prior cycle, pointing to stronger risk controls and resilience.
• He says RWA issuance and onchain perps keep growing even when crypto prices fall, citing commodities activity like tokenized silver.

Chainlink cofounder Sergey Nazarov says that crypto market cycles are showing signs of improving institutional resilience and accelerating real-world asset (RWA) activity onchain. In a post on X, Nazarov wrote that downturns could act as stress tests for market structure, and he pointed to the absence of large, system-wide risk management failures during the current cycle compared with prior periods marked by major institutional collapses.

Nazarov attributed the steadier outcome to better risk controls across crypto markets, even during periods of sharp price drawdowns and tighter liquidity. There have been some notable downturns for some companies and individuals; Cardano founder Charles Hoskinson revealed his net worth fell by more than $3 billion during the recent market downturn. 

The Chainlink cofounder said that if industry infrastructure continues to function through volatile conditions, it supports the case for broader participation from both retail and institutional capital, because operational continuity matters during stress.

He also said RWA migration to blockchains is continuing even when major crypto assets fluctuate, framing tokenized assets and related onchain activity as a separate adoption track. Nazarov pointed to the ongoing growth in RWA issuance and said onchain perpetual markets tied to traditional commodities can remain active when access to permissioned venues becomes more difficult for some participants. 

At the height of last year’s bull market, the Chainlink cofounder, as we reported, projected that DeFi adoption could rise to 70% by 2030.

RWA Tokenization and On-Chain Infrastructure Gain Momentum

In the same thread, Nazarov described three adoption forces he expects to shape the next stage of the market. These are onchain perps linked to RWAs, increased institutional usage driven by utility, and rising demand for infrastructure that connects RWAs to blockchains. He tied that infrastructure demand to the need for reliable market data, collateral management, and workflows that combine onchain and offchain systems.

Nazarov said data is required for many RWA use cases, including market pricing for onchain derivatives, proof-of-reserves frameworks, and fund valuation inputs used by tokenized products. He also said connectivity between chains and traditional back-office systems supports liquidity movement, while interoperability tools can connect onchain activity to existing accounting and risk systems.

He further pointed to orchestration as a requirement for coordinating transactions across multiple networks and offchain services, and he referenced the Chainlink Runtime Environment as a platform intended to support those workflows, including privacy-focused components still under development. 

Nazarov added that if RWA activity continues expanding, onchain RWAs could eventually exceed cryptocurrencies in total onchain value, while crypto assets may still benefit from higher onchain capital levels.

The comments drew agreement from some industry figures, with Bitwise CEO Hunter Horsley replying on X: “Amen to this, well said.”