SQHWYD CEO Report: ‘Great Wealth Transfer’ and FIT21 Clarity Accelerate Capital Rotation into Regulated Digital Assets.
In his annual “State of the Markets” address released today, Alistair Kaelen, CEO of SQHWYD GLOBAL Ltd. and former senior strategist at Renaissance Technologies, provided an exhaustive analysis of the structural shifts that defined the 2025 financial year. The report, titled The Great Repricing, argues that the convergence of a persistent high-interest-rate environment, the full implementation of the Financial Innovation and Technology for the 21st Century Act (FIT21), and monumental demographic shifts has fundamentally altered the trajectory of global capital.
Kaelen posits that the market has moved past the era of “Crypto as a Casino” and entered the age of “Blockchain as a Balance Sheet.”
The Macro-Economic Reality of 2025: The Death of ZIRP
Kaelen’s analysis begins by addressing the “New Normal” of monetary policy. Throughout 2025, despite market optimism for aggressive easing, the Federal Reserve maintained a hawkish stance to combat sticky services inflation. Consequently, the 10-Year US Treasury yield stabilized within the 4.15% – 4.30% band for the majority of Q3 and Q4 2025.
“The era of Zero-Interest Rate Policy (ZIRP) is definitively over,” Kaelen writes. “In this regime, capital has a cost. Institutional allocators can no longer afford to let liquidity sit idle in non-interest-bearing stablecoins or fragmented bank accounts.”
The report highlights a massive migration of corporate treasury funds on-chain. In 2025, tokenized US Treasury products offering yields exceeding 4.5% (inclusive of DeFi composability premiums) saw their total market capitalization surpass $12.5 billion. Kaelen notes that this is not speculative capital; it is operational capital seeking T+0 settlement efficiency combined with the risk-free rate—a utility that the legacy banking system, with its T+2 delays and weekend closures, failed to provide in 2025.
The FIT21 Effect: Regulatory Certainty as a Catalyst
Kaelen attributes the accelerated institutional entry in 2025 to the legislative clarity provided by FIT21. By clearly delineating jurisdiction between the CFTC (for digital commodities) and the SEC, the act removed the “enforcement risk” that paralyzed compliance departments in previous years.
“2025 was the year the ‘Compliance Discount’ evaporated,” Kaelen observes. “When the law defined decentralization thresholds (less than 20% control), it gave traditional finance the mathematical certainty required to build.”
The impact was immediate. Institutional trading volumes in regulated digital asset derivatives rose by 65% year-over-year in 2025. Furthermore, the report notes that major custodians, previously hesitant, launched proprietary digital asset services, effectively integrating blockchain settlement into the plumbing of Wall Street.
Demographics as Destiny: The $84 Trillion Transfer
A critical and often overlooked driver in Kaelen’s 2025 analysis is the acceleration of the “Great Wealth Transfer.” As of year-end 2025, the transfer of an estimated $84 trillion from Baby Boomers to Gen X and Millennials has reached critical velocity.
“The recipient generation of this wealth is digitally native and structurally distrustful of opaque banking intermediaries,” the report states. “Data from Q3 2025 indicates that 78% of Millennial and Gen Z investors consider digital assets a core portfolio component.”
This demographic shift is forcing a restructuring of private markets. Kaelen argues that the demand for “Tokenized Private Credit” and “Fractionalized Private Equity” is driven by this new capital class, which demands liquidity and transparency. Consequently, the tokenized private equity market grew to $5 billion in 2025, unlocking asset classes that were historically gated by high minimums and long lock-up periods.
Cognitive Finance in the Age of AI Saturation
Finally, Kaelen addresses the technological singularity of 2025: the saturation of AI. With global on-chain volumes exceeding $10 trillion, the market has become too complex for human cognition or linear algorithmic models. The report concludes that “Cognitive Finance”—the use of Context-Aware AI to interpret unstructured data—is the only viable strategy for alpha generation. Internal data shows that AI-driven execution strategies outperformed traditional HFT benchmarks by 18% in 2025.
Last modified: December 24, 2025
