Internet capital markets (ICM), where creators launch tokens backed by attention, not assets, is crypto’s newest trend. So how does ICM compare to it’s more established cousin, decentralized finance? This internet capital markets vs. DeFi guide pits the two sectors against one another. Here are the key differences and similarities to know in 2025.
KEY TAKEAWAYS
➤ Internet capital markets tokenize internet-native ideas like memes, apps, and narratives — turning attention into tradeable assets.
➤ DeFi builds financial infrastructure, enabling decentralized borrowing, lending, staking, and swaps with protocol-driven value.
➤ ICM, DeFi, and Regulated DeFi form three distinct models on-chain, each with different users, risks, and long-term potential.
Internet capital markets vs DeFi: Key differences
ICM and DeFi both live on-chain, but that’s where the similarities end. ICM enables anyone to mint and trade internet-native ideas. Meanwhile, DeFi builds decentralized financial systems. ICM is driven by narrative; DeFi by protocol logic. Here are the aspects across which they really differ:
| Aspect | Internet capital markets (ICM) | DeFi (Decentralized finance) |
| What’s being tokenized | Internet-native ideas (memes, apps, social projects) | Financial infrastructure (staking, lending, governance rights) |
| Token creation process | No-code, instant launches via social media tools (e.g., Believe, Pump.fun) | Smart contracts, protocol deployments, dev-heavy setups |
| Access & onboarding | No KYC, instant buy-in via bonding curves or links | Wallet-based access, but increasingly geo-gated and KYC-tied |
| Price discovery mechanics | Bonding curves drive up-only pricing until interest fades | AMM-based pools with slippage and active price discovery |
| Utility vs. narrative | Driven by social momentum, memes, hype | Anchored in protocol utility, economic rights, governance |
| Risk profile & behavior | High volatility, short-lived cycles, minimal liquidity post-peak | More stable, with slower decay and longer project timelines |
| Regulatory exposure | Largely unregulated, facing growing scrutiny (e.g., Pump.fun blocking UK/India) | Facing global pressure, but increasingly aligned via DAOs, wrappers, or KYC |
| Community vs governance | Community-led movements, social polling, no formal governance | On-chain governance via DAOs, token voting, treasury control |
| Liquidity design | Bonding curves without pooled liquidity; hard exits | Liquidity pools via AMMs enable structured entry |
Here’s a closer look at each differentiator.
What’s being tokenized?
ICM turns internet-native ideas: apps, memes, and social movements, into tokens. It’s less about building a protocol and more about capturing cultural energy. Projects like VINE (reviving the old video app) or DUPE (a search engine for lookalike products) are examples of attention-led tokens created on platforms like Believe.
Did you know? VINE is an ICM token launched around the nostalgia of the original Vine app, aiming to rebuild a short-form video platform. DUPE, on the other hand, helps users find cheaper alternatives to popular products; its token captures value from usage hype, not actual product sales.
DeFi, on the other hand, tokenizes actual financial infrastructure. Tokens represent lending rights, staking access, or governance power. Think AAVE, UNI, or LDO: each tied to protocol-level utility.
Launch mechanics
ICM tokens launch fast. On platforms like Believe, a single tweet can trigger a token drop; no smart contract audits, governance votes, or devs are needed. The platform handles the bonding curve, tokenomics, and even DEX listing thresholds. It’s launch-as-you-post, built for speed over structure.
Fact check: Ben Pasternak founded Believe, which lets users tokenize any idea just by tweeting. It uses dynamic fees, auto-graduation to DEXs, and a $100K market cap unlock. It’s what powers tokens like VINE, DUPE, and JELLYJELLY and is often compared to Pump.fun, though with more creator-first mechanics baked in.
DeFi, by contrast, is on the opposite end of the spectrum. Whitepapers, governance discussions, audits, and the development of layered incentive designs often precede launches. While ICM bets on momentum, DeFi is still mostly engineered around caution (at least in comparison)!
Target user
ICM is built for internet natives: meme lords, community builders, solo creators, and even parody accounts. It’s less about financial literacy and more about social capital. If you can drive attention, you can launch a token. No need to be a dev, investor, or protocol governor. That’s why platforms like Believe are dominated by Gen Z creators and Twitter-first projects.
Here’s what you didn’t know: The majority of top-performing ICM tokens in Q2 2025 came from accounts with under 10K followers. The common thread? Viral tweets; not VC backing or whitepaper depth. ICM flips the web3 power pyramid: creators launch tokens first, then figure out utility later.
DeFi, on the other hand, still speaks to power users: people who stake, farm, vote, and LP. The entry point is usually a DApp, not a tweet. Users should know how to navigate contracts, evaluate risks, and understand APYs, not just trends.
Liquidity structure
ICM liquidity is thin, fast, and reactive. Most tokens launch with micro-caps under $1K and rely on bonding curves to bootstrap liquidity. Platforms like Pump.fun or Believe auto-seed pools, but if hype dies, so does depth. There’s rarely slippage protection or market-making; everything is frictionless until it isn’t.
For the unversed, bonding curves are automated formulas that adjust token price based on how many tokens are bought or sold. The more buyers, the higher the price; so early entries are rewarded, but exits get expensive if demand falls.
Note: On Believe, a token needs ~$100K market cap before hitting a DEX. Until then, it’s stuck in curve mode with little real liquidity.
DeFi takes a more deliberate route. Liquidity is often provided through AMMs like Uniswap or Curve which have deeper pools, incentivized farming, and active LP management. Protocols like Balancer even let DAOs customize pool weights. In DeFi, liquidity is a strategic resource, not a viral moment.
Fact check: While ICM pools can dry up in hours, DeFi protocols like Aave and Compound often maintain TVL in the billions. But DeFi’s deep liquidity comes at the cost of complexity; providing it often requires capital, knowledge, and smart contract risk tolerance.
Utility vs narrative
In ICM, narrative is everything. Tokens don’t need a working product, team roadmap, or even a clear use case. The pitch is the meme. If the idea catches on — like reviving Vine or launching a parody search engine: it can move volume. Utility may follow, but it’s rarely the launch driver.
DeFi still plays the long game. Tokens like AAVE or CRV earn fees, give governance rights, and gate features. Projects often build for months or years before launching a token. Utility isn’t an afterthought; it’s the point.
Some ICM tokens eventually spin into utility layers post-hype. DUPE, for example, is experimenting with search-to-earn mechanics, while JELLYJELLY teased features like clip sharing for token holders. But adoption often trails the meme, not the other way around.
Risk profile & market behavior
ICM tokens are volatile by design. Prices swing wildly, often within minutes of launch. Since most tokens debut with near-zero liquidity and no investor safeguards, even a single tweet can spark a 10x or a full rug. It’s not uncommon for holders to lose 80% in a day if momentum fades.
DeFi tokens aren’t exactly safe either, but they operate in more structured ecosystems. Price action is shaped by fundamentals like TVL, protocol revenue, and governance activity. When tokens drop, it’s usually tied to protocol changes, not meme fatigue.
Did you know? ICM tokens like LAUNCHCOIN or DUPE have seen 50%+ intraday swings during their first week of trading. Meanwhile, mature DeFi assets like UNI or LDO typically see less than 10% daily volatility, unless triggered by major news or exploits.
Regulatory exposure
ICM lives on the edge of regulation; sometimes literally. Platforms like Pump.fun let anyone spin up a token in seconds, no KYC, no disclosures. That freedom has consequences. In early 2025, Pump.fun blocked UK users after pressure from regulators. India followed. Lawsuits kicked in soon after, with one around “PNUT” hitting $140M before crashing.
DeFi isn’t lawless, just layered. Projects like Uniswap and Curve have started using geo-blocks or tweaking frontends to stay compliant. Some are even flirting with KYC wrappers and offshore foundations to keep things above board.
A 2025 audit found that over 98% of tokens launched on Pump.fun were either scams or abandoned within days. Only 97K out of 7 million had more than $1K in liquidity. That’s not just risky — it’s a regulatory red flag.
Here is a revolutionary inclusion that could change things for ICM over time:
Community vs. governance
With ICM, most tokens don’t have voting rights or formal treasuries. Communities form overnight, driven by social energy, not governance docs. DeFi leans slightly more formal. Projects like AAVE or Lido rely on on-chain votes, DAO proposals, and treasury allocations. Governance isn’t always efficient; but it exists, and it shapes everything from fees to partnerships.
While ICM projects don’t use DAOs, some mimic their influence. The DUPE team occasionally polls the community for feature input, purely social, no tokens required. It’s governance without the gavel.
Where does regulated DeFi fit in?
While DeFi evolved from a permissionless ethos, a new class of regulated DeFi protocols is now finding a middle ground — on-chain, but compliant. These protocols maintain smart contract-based operations while integrating KYC, whitelists, and reporting standards to meet legal expectations.
This is relevant because Internet Capital Markets (ICM) deliberately reject this layer. ICM platforms like Believe don’t screen users, verify identities, or report financials. That’s the whole point; they’re about speed and creative freedom.
But as DeFi experiments with compliant bridges, ICM has thus far opted out entirely, reinforcing its positioning as a space where capital forms fast, but often fades faster.
Did you know? Platforms like Aave Arc and Maple Finance introduced gated access and regulated pools to attract institutional capital. No such mechanisms exist in ICM or even many DeFi protocols; for now, it’s creator-first and trustless, not investor-protected.
Where the internet collides with finance
Internet Capital Markets aren’t replacing DeFi. DeFi builds programmable money, while ICM builds tradeable narratives. But there’s a catch: ICM moves fast, breaks things, and, so far, lacks depth. DeFi, while slower, offers structure and sustainability. And now, with Regulated DeFi emerging as the third model, we’re seeing the on-chain stack evolve to meet creators, investors, and institutions where they are. While not all on-chain assets are built alike, they’re all now part of the same internet-native capital game.
Frequently asked questions
Is Internet Capital Markets the same as meme coin trading?
Can institutional investors participate in ICM?
Are there bridges between ICM and DeFi?
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