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Traditional finance giants are making unprecedented moves into blockchain infrastructure, with BlackRock’s entry into decentralized finance and the UK government’s selection of HSBC for its digital bond program signaling a fundamental shift in institutional crypto adoption. These developments, combined with new AI-powered wallet infrastructure and expanded lending platforms, suggest 2026 could be the year institutional DeFi goes mainstream.
BlackRock’s Historic DeFi Entry
BlackRock has taken its first formal step into decentralized finance by bringing its $2.18 billion USD Institutional Digital Liquidity Fund (BUIDL) to Uniswap. The tokenized Treasury fund, currently the world’s largest tokenized money market fund, will be available for institutional investors to trade on the decentralized exchange through a partnership with tokenization firm Securitize.
As part of the arrangement, BlackRock is also purchasing an undisclosed amount of Uniswap’s native governance token UNI. The trading will initially be restricted to qualified institutional investors and market makers before potentially expanding to a broader audience. This marks a significant milestone for DeFi institutional adoption, allowing institutions to trade real-world tokenized assets with self-custody capabilities for the first time.
BUIDL operates across multiple blockchains including Ethereum, Solana, BNB Chain, Aptos, and Avalanche, and reached a key milestone in December by surpassing $100 million in cumulative distributions from its Treasury holdings.
UK Government Pioneers Digital Bond Infrastructure
The United Kingdom has selected HSBC Orion for its Digital Gilt Instrument (DIGIT) pilot program, marking another major institutional blockchain adoption. The Treasury chose HSBC’s tokenization platform to conduct a pilot issuance of digital government bonds, aiming to improve efficiency, reduce costs, and enhance security through distributed ledger technology.
HSBC Orion has already facilitated at least $3.5 billion in native digital bond issuances globally since its 2023 launch, including the European Investment Bank’s first digital sterling bond and a $1.3 billion multi-currency bond issued by the Hong Kong government. The DIGIT program will operate within the Digital Securities Sandbox independently of the UK’s main debt management program, while supporting secondary market development and greater accessibility through on-chain settlement.
Institutional Lending Platforms Expand
Spark has launched two new institutional products targeting the growing demand for on-chain stablecoin lending. Spark Prime offers margin-type lending and off-exchange settlement, while Spark Institutional Lending connects Spark’s governed markets with qualified custodians like Anchorage Digital, allowing clients to maintain collateral within regulated custody.
With $5.24 billion in total value locked, Spark has already committed around $150 million in institutional lending, with capacity to scale to billions in coming months according to Phoenix Labs CEO Sam MacPherson. The platform supplied over 80% of USDC liquidity for Coinbase’s Bitcoin-backed lending market on Morpho, helping drive approximately $500 million in lending growth during the first three months.
AI Agents Get Crypto Wallets
Coinbase has released “Agentic Wallets,” specialized wallet infrastructure designed for AI agents to autonomously manage funds and execute blockchain transactions. Built on the Base layer-2 network, these wallets enable AI agents to hold, send, trade tokens, and earn yields without human intervention, while incorporating security features like per-session spending limits and smart contract restrictions.
Lightning Labs simultaneously released tools allowing AI agents to transact on Bitcoin’s Lightning Network using the L402 protocol, suggesting a broader trend toward autonomous AI financial activity.
Market Outlook
Despite these institutional advances, DeFi’s total value locked has declined to $95 billion from a peak of $171 billion in October 2025, representing a 45% contraction over five months. However, the convergence of traditional finance infrastructure with blockchain technology, AI agent capabilities, and expanded institutional lending suggests the foundation is being laid for significant growth once market conditions improve.
Ripple has also strengthened its institutional infrastructure through partnerships with Securosys and Figment, expanding enterprise custody and staking capabilities across major proof-of-stake networks including Ethereum and Solana.
