Security Tokenization and Prediction Markets: 7 Major Crypto Boons to Watch in 2026

Original Title: 7 Crypto Lessons and Trends to know before 2026

Original Author: 0xJeff, AI Investor

Original Translation: Techflow Deep Tide

2025 was a year filled with unprecedented turmoil and change. We saw the rise of a U.S. president reportedly supportive of cryptocurrency and artificial intelligence. However, the market in 2025 did not witness the anticipated bull run; instead, it became a year of industry-wide "slaughter."

· Most altcoins experienced an 80%-99% crash in 2025

· Bitcoin's market dominance returned to 2019-2020 levels (over 60%), outperforming most currencies

· Ethereum's (ETH) trading price was similar to that of 2022

· The altcoin market was highly fragmented (with 40 to 50 million different coins available)

· Despite continuous positive news in the industry (such as a clearer regulatory framework, ETF approvals, corporate adoption of blockchain technology, institutional investment in BTC, ETH, and altcoins, etc.), the performance of the stock market in 2025 completely overshadowed the crypto market

Despite the pain and turmoil, 2025 was still seen by many as the industry's "year of maturity," but it also witnessed a large exodus of practitioners and investors.

So, for those who are still holding strong in the crypto space, here are the key things to know before the arrival of 2026:

Let's dive in ↓

Oracle Markets: Multi-Purpose Trading Tools

Oracle markets became one of the fastest-growing verticals in 2025 — with the nominal weekly trading volume reaching $3.8 billion for the first time, Polymarket, Kalshi, and Opinion emerging as dominant platforms in this space.

Despite the ongoing debate about whether "oracle markets are equivalent to gambling," the U.S. Commodity Futures Trading Commission (CFTC) views them as event contracts or binary options based on real-world outcomes. The CFTC's innovation-friendly stance, coupled with the increasing demand for betting/prediction in the market, drove rapid growth in oracle market trading volume in 2025.

From a trading tool perspective, the prediction market has shown great flexibility. It can be seen as a more user experience-optimized options tool (but still lacks in liquidity).

You can use leverage trading in any market, choose a "yes/no" directional bet, use it as a hedging tool (by holding spot positions elsewhere), or earn returns and potential airdrop rewards by executing a delta-neutral strategy (equally allocating "yes/no" stakes in the market).

Cash-Secured Put Options vs. Covered Call Options

These two option strategies are very suitable for investors who want to manage their investments in a more conservative way.

Instead of directly buying or quickly selling altcoins when the price drops, it is better to generate cash flow by selling call or put options. If the price reaches a certain target, you can choose to buy low or sell your altcoins; if the price does not reach the target, you will recoup your principal.

This strategy is one of the best ways to generate a high Annual Percentage Rate (APR) for your altcoin or stablecoin.

The only thing to note is that your principal will be locked up for a period of time (usually 3-5 weeks), but you will receive the option premium immediately upon selling the call or put option.

Narrative Fatigue + Equity vs. Token = Back to Basics

The speed of market narrative rotation has significantly accelerated, with hot topics that used to last for weeks or even months now lasting at most a few days.

The crypto community (CT) is shifting from chasing narratives to focusing on real fundamentals (such as user count, revenue, growth metrics). The market is more inclined to evaluate indicators of real business and clarify the value transfer relationship between the business and the token.

However, this year in the tug of war between equity and tokens, we have witnessed too many chaotic situations, especially in the mergers and acquisitions (M&A) space:

· Pumpfun acquired Padre (a trading tool) but left Padre's token holders completely in the dark. After the acquisition announcement, the PADRE token plummeted by 50%-80%, triggering a strong community backlash. To appease the Padre community, Pumpfun promised to airdrop PUMP tokens based on the PADRE holding value before the acquisition announcement.

· Circle acquired Axelar but similarly overlooked Axelar's token holders. Following the acquisition, the AXL token saw a significant decline. This is recent news, and what will happen next remains to be seen, but the community is already rightfully angry.

The debate between equity holders and token holders has escalated, leading us to a deeper question...

Market-Governed Organizations and Ownership Tokens

MetaDAO has introduced a fair, transparent, and uncensorable ICO launchpad characterized by high liquidity, a relatively low Fully Diluted Valuation (FDV) structure, and no venture capital (VC) or private sale allocations. Additionally, it has implemented mechanisms such as performance-based team unlocks and potential fund recovery features.

This structure gives token holders true ownership, control, and alignment of interests, effectively addressing issues such as exit scams, token dumps, insider dealing, and hostile takeovers.

Colosseum (an independent accelerator of the Solana ecosystem) recently introduced "STAMP" (Simple Token Agreement, Market Protection Mechanism), a novel investment contract designed to merge private sale venture funding with a public MetaDAO ICO, ensuring investor rights align with MetaDAO's on-chain governance.

The MetaDAO model has spawned a new category known as "Ownership Tokens," with projects launched through MetaDAO's ICO. Many projects that have launched show strong performance—for example, Umbra, Omnipair, and Avici saw significant market outperformance in 2025.

Through the MetaDAO model, the significance of token holders has been elevated, giving them true voice and actual ownership of the project. Project revenues and expenses are no longer directed to equity holders but directly benefit token holders.

The trend of Market-Governed Organizations and Ownership Tokens is likely to continue into 2026 and will intertwine with upcoming trends...

The Rise of Security Tokenization

On-chain liquidity constraints have shifted market participants' focus towards fundamentals, revenue, buybacks, and other real-world value. Simultaneously, businesses are embracing stablecoins, more institutions are entering the crypto space, and recently, security tokenization has become simpler and more viable than ever, especially for regulated entities.

On December 11, 2025, the field of security tokenization witnessed a significant regulatory breakthrough. The U.S. Securities and Exchange Commission (SEC) issued a "No-Action Letter," clearly stating that it would not take enforcement action against DTC, a subsidiary of DTCC (Depository Trust & Clearing Corporation), for its pilot security tokenization program. The pilot includes tokenization of Russell 1000 Index constituents, U.S. Treasury bonds, and major ETFs.

This mechanism, during the pilot phase (starting in the second half of 2026 for a period of three years), achieves compliant centralized tokenization operations through DTC, guiding activities to regulated infrastructure rather than fully decentralized alternative solutions.

This means that starting from 2026, we will see more security tokenization projects, indicating an increased demand for tokenized stocks, accelerating the convergence between Traditional Finance (TradFi) and Decentralized Finance (DeFi).

Consumer-Grade Crypto Products and Perpetual Contracts Become Crypto Core

In 2025, consumer-grade crypto products and perpetual contracts (Perps) became the core hotspots of the crypto industry:

· Pumpfun peaked in 2024-2025

· Virtuals adopted a similar pattern but integrated a brand-new AI smart agent narrative

· Zora also made similar attempts in the content token field and gained Jesse's support

· Collectibles, Fantasy Football, and prediction markets gained huge popularity in 2025

These are all consumer-oriented products that allow crypto natives to experience fun and also attract non-crypto users (such as participants in prediction markets) to earn rewards while having fun.

Crypto itself is like a game, and trading is entertainment. Therefore, consumer-grade products that are innovative and effectively combine the two aspects often stand out.

Perpetual contracts (Perps) also have a similar appeal because they allow users to make precise bets on asset price movements.

If you look at key metrics for prediction markets and perpetual contracts, you'll find that they both hit all-time highs in 2025. This data seems to "scream" that the Product-Market Fit (PMF) in the crypto space has emerged: the weekly nominal trading volume of prediction markets reached $3.8 billion, while the weekly trading volume of perpetual contracts soared to $340 billion (monthly trading volume of $1.3 trillion, hitting a historical high).

This is why people are so eager to participate in platforms such as Hyperliquid, Lighter, Aster, Polymarket, and Opinion. The massive trading volume, high demand, and substantial capital flow directly translate into higher valuations and more airdrop rewards.

Consumer-grade encryption products are also full of potential, but in 2025, we have not yet seen truly sustainable consumer-grade encryption products. Sportsdotfun (SDF) showed promising early growth and is currently undergoing community funding on Legion and Kraken. Although the future of this field remains uncertain, the current outlook is exciting.

From this, we can learn that if you want to find your edge in this market, either invest in platforms (such as prediction markets, perpetual contracts, consumer-grade encryption products), or actively engage in these categories:

· Learn how to trade perpetual contracts

· Make predictions in prediction markets

· Use consumer-grade encryption products

Through these practices, you can better understand the market and find your competitive edge. Otherwise...

You could become a "Storyteller"

That's right, now The Wall Street Journal, Silicon Valley, and various tech professionals are all starting to embrace the role of "Storyteller." Many startups have opened up positions for "Storytellers."

In the crypto field, this has long been a common phenomenon. We have "Yappers," Key Opinion Leaders (KOLs), and storytellers who have been discussing projects and helping build the crypto community for years (even before Kaito introduced the "Yapper" concept).

But now, it seems that the whole world is realizing the importance of having the right narrative and delivering the brand, product, and positioning in the right way.

However, the role of a Storyteller goes far beyond being a "Yapper." Currently in the crypto field, many "Yappers" simply copy and paste content to "boost their presence," rather than trying to truly learn and understand what they are discussing.

This provides an opportunity for those who truly understand the industry, have expertise, or are curious learners to stand out—whether in the crypto community (CT) or in a broader field.

Those skilled in storytelling can expand their brand influence and ultimately have the right to choose freedom: they can choose to develop independently or be "acqui-hired" by startups and projects that align with their brand.

In 2025, we have already seen successful cases of this dynamic. For example, Kalshi recruited prominent figures from the crypto community, and some crypto projects have successfully shaped their brand image and attracted more users through close partnerships and ambassador programs (such as sharing badges).

If you are good at telling stories, then this is the stage for you in this era!

Core Summary

The crypto market in 2024-2025 is like playing the "Monopoly" game;

while 2026 will be more like the stage for corporations, startups, and suited financial professionals—less of the "Monopoly" game style, fewer easy money-making opportunities, and less reliance on the narrative of simply relying on "digital growth."

The future will focus more on fundamentals, alignment of interests, value accumulation, and compound leverage. If you cannot cultivate a real competitive advantage, even if you are an OG (veteran player), you may ultimately end up as someone else's "bag holder."

Your competitive advantage can be any of the following:

· Having a clear mind, not being misled by delusions;

· Good at telling a good story;

· Building high-quality products that people truly need;

· Insight into trends;

· Rational trading, not influenced by emotions.

Stick with it, find your strengths, and you will be rewarded.

Thank you very much for reading! If you want to know my thoughts on certain projects and a more straightforward take, you can check out my column, The After Hour, on Substack.

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