Is TradFi an opportunity for crypto users? How does it differ from ETFs and RWA?

Traditional Finance (TradFi) can gain popularity in the crypto market, indicating that the profit opportunities in Web3 and the crypto market are truly limited.

December 2025, according to the crypto market cycle, this December should be a celebration of a massive bull market, and many seasoned crypto enthusiasts are dreaming that this bull run will achieve financial freedom.

However, the reality is: altcoins are trapped, MEME tokens have gone to zero, and contracts are liquidated💔

Watching traditional financial markets hit new highs in precious metals like gold and silver, and the US stock market steadily rising, crypto users and investors are not only feeling nostalgic but also realizing that trading cryptocurrencies might not be as profitable as trading gold.

TradFi means Traditional Finance, related to precious metals, crude oil, and stock markets. But the term TradFi is likely an original new term in the crypto industry, similar to DeFi and GameFi, with the main difference being that TradFi is centralized, not decentralized.

The purpose of TradFi, like ETFs and RWA, is to promote the integration of Web3 crypto markets with traditional finance. ETFs are more inclined to channel traditional funds into the crypto market, while TradFi and RWA are more about providing crypto users with additional options when there are no profit opportunities in the crypto market.

Core comparison table of TradFi, ETF, and RWA

In simple terms:

TradFi: Crypto trading platforms offer users a diversified investment approach.

ETF: Traditional financial institutions provide a way for traditional users to trade cryptocurrencies.

RWA: Platforms supporting on-chain trading offer users a way to participate in traditional assets trading.

The common point is that platforms or financial institutions launching related sectors can attract more funds and trading fees.

For ordinary crypto investors, does TradFi offer any profit opportunities?

TradFi is not a new concept; unlike DeFi in 2020 or GameFi in 2021, which could bring rapid wealth, TradFi’s investment targets—such as crude oil, gold, stocks—are traditional investment methods that rarely experience rapid surges or crashes unless a black swan event occurs.

However, TradFi is indeed an important step in the development of the crypto industry. For crypto investors, it provides more investment options and more convenient ways to invest. When there are no better profit opportunities in the crypto market, crypto users can also embrace TradFi to participate in other asset investments, such as using USDT or USDC to buy gold as a hedge during geopolitical crises or extreme policies.