Pyth Network (PYTH): A $50 billion institutional pivot
September 4, 2025
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This content was written as part of a commercial collaboration. Although the OAK Research team conducted a preliminary assessment of the project presented, we disclaim any liability for losses or damages resulting from decisions based on this article. Cryptocurrencies involve high risks, and this content is provided for informational purposes only and does not constitute investment advice.
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After becoming one of the most important decentralized oracles in the DeFi ecosystem, Pyth Network (PYTH) could be opening up to a new market: traditional finance. Let's explore the reasons behind this institutional pivot and the potential prospects for Pyth.
Conquering a $50 Billion Market
Since its launch in 2021, Pyth Network has established itself as a key player in decentralized finance. The protocol has built one of the largest oracle and financial data distribution infrastructures in the sector, powering hundreds of applications and securing over $8.3 billion on-chain.
This first phase of Pyth’s history validated the team’s initial thesis: the protocol’s infrastructure addresses a real need for on-chain finance and provides a reliable, secure alternative for distributing financial data.
However, since its inception, Pyth has faced the same challenge as all other decentralized oracles: the difficulty of generating stable revenues while relying on protocols native to an industry still under construction, and consequently, the limited value flowing back to the PYTH token. While Pyth stands to gain from a future where DeFi yields sustainable fee flows, the protocol is charting a broader course today.
Throughout this period, Pyth’s ambition has always been clear: “bring the price of everything, everywhere.” After conquering decentralized finance and bringing together hundreds of entities publishing their data directly to its network, Pyth Network is now entering the second phase of its vision: tackling traditional finance.
The goal is to leverage its infrastructure and network to deliver an institutional-grade product designed to serve traditional financial players. This new phase can also address the revenue challenge, strengthen the value of the PYTH token, and ensure the protocol’s long-term economic sustainability.
The financial data market is currently dominated by a handful of legacy players and represents more than $50 billion in annual enterprise spending. With a proposed strategic pivot by Douro Labs, Pyth is well-positioned to capture part of this value. We have decided to take a closer look at the information available to better understand where this pivot could have the greatest impact.
Background on Pyth
Launched in 2021, Pyth is an oracle protocol designed to provide reliable and secure financial data to decentralized applications. Unlike most traditional oracles, Pyth adopted a radically different model: collecting data directly from first-party providers.
These providers include exchanges, market makers, banks, and financial institutions who publish their data on Pythnet, an appchain used to aggregate and validate information before producing price feeds for applications. Today, Pyth counts 125 active “publishers” contributing to its network.
Pyth also integrates the Wormhole protocol to broadcast more than 2,100 price feeds to over 100 blockchains, with near-instant latency (400 milliseconds). Smart contracts leverage Hermes, a pull-based API that requests price updates only when needed, minimizing both costs and latency.
In just a few years, Pyth has achieved real success: more than 600 connected applications and protocols, 1,800 covered assets, with nearly 900 of which originate from traditional finance markets, and a cumulative secured volume exceeding $1.6 trillion. The protocol claims over 60% market share in the derivatives sector.
Beyond the numbers, Pyth’s initial thesis has been validated: there is a real need for an open, universal infrastructure for distributing financial data. With Pyth, data is no longer siloed by asset, market, region, or provider, but becomes universally accessible via a “price layer”, as it were. This first phase laid the groundwork for a new economic model for the market data industry.
→ For further reading, see our full presentation of Pyth Network (PYTH):
A Pivot Toward Traditional Finance
The problem with decentralized oracles
Oracles are today a fundamental building block of DeFi, yet they have always faced the same problem: the difficulty of generating stable revenues in the face of relatively limited market demand, despite their critical role.
With the emergence of new players, DeFi protocols found themselves with an increasingly wide range of options. Even though each oracle attempted to differentiate through additional services, the core use case remained the same: providing price feeds for decentralized protocols, particularly in lending markets and derivatives.
However, as DeFi grew, only a minority of protocols managed to generate sufficient revenue to ensure long-term sustainability. Most had to continue subsidizing their activities through their tokens, which also explains the limited revenues captured by oracles.
Attempts to increase fees only made the problem worse: as soon as an oracle raised its prices, protocols would immediately migrate to cheaper solutions. This created a true race to the bottom, where new entrants offered increasingly lower prices to attract projects, further weakening the economic model of oracles.
This vicious cycle, a kind of ouroboros combining price competition with structural revenue weakness, has long constrained the sector’s growth. But a new path is now emerging: with the gradual arrival of traditional finance on-chain, institutions are showing growing interest in accessing reliable, precise data directly at the source, something that first-party oracles or a price layer like Pyth are now able to provide.
Phase 2 of Pyth
From the approval of Bitcoin spot ETFs, to BTC recognition by major financial institutions, the rise of publicly listed crypto firms, the tokenization of financial assets on blockchain, the growth of stablecoins, and the growing number of DeFi-TradFi partnerships: the institutionalization of crypto markets is no longer in question.
Pyth’s second phase, as proposed in the newest roadmap statement contributed by Douro Labs, fits into this new trajectory. If the first stage proved the model’s viability in DeFi, the second now aims to target the institutional financial data market, estimated at more than $50 billion.
This proposed pivot is not a coincidence. It builds on Pyth’s recent innovations. Over the past weeks, Pyth has expanded its coverage by listing price feeds for major U.S. ETFs, the UK’s top 100 public companies, the Hang Seng Index of leading Chinese and Hong Kong equities, and U.S. government economic data.
The Problem with the Financial Data Market
This pivot reflects a deeper structural issue: the current infrastructure of financial data is fundamentally flawed. Today, market data is acquired by intermediaries like Bloomberg or Refinitiv from trading platforms, before being resold to institutions that rely on it for their operations.
This model creates fragmentation, with data siloed across sources (by region, asset class, or market type). Intermediaries do not resolve this lack of coherence; instead, they patch fragments together into bundled services, reselling them at costs that reach billions of dollars each year.
Over the past three years, the price of accessing market data in traditional finance has increased by 50%.
Most importantly, the trading firms and entities that generate this primary data (even before it reaches exchanges, which in turn sell it to intermediaries) capture none of the revenue created downstream.
Pyth’s Solution
The Pyth contributors propose to address precisely this inefficiency, by building on the infrastructure created in Pyth’s first phase: a network where data is collected at the source, published in real time by institutions, aggregated and mutualized, and then distributed across more than a hundred blockchains.
With this foundation, Pyth can now deliver an institutional product combining:
- Data quality, directly from primary providers.
- Execution speed, with millisecond-level updates designed for high-frequency trading.
- Accessibility, through infrastructure far less costly than current solutions.
The proposed vision is to offer subscription-based access, enabling financial institutions to integrate these data feeds into their existing workflows: risk models, settlement systems, compliance tools, display terminals, or historical research databases.
To maximize adoption, for example, payments could be in dollars, stablecoins, or PYTH tokens. Value captured from subscriptions would be directed to the DAO, which would collectively decide on its redistribution: Pyth DAO governance discussions have included topics such as PYTH buybacks, revenue-sharing with contributors, staking incentives, and more.
With this proposed pivot, Pyth is no longer just an oracle for DeFi, but is positioning itself as a market infrastructure player targeting a $50 billion market still dominated by legacy incumbents.
Addressing the Structural Inefficiencies of the Oracle Market?
Beyond the fundamental reasons behind Pyth Network’s pivot, it is worth revisiting another motivation mentioned earlier in this analysis: the issue of revenue generation by oracles and their ability to reflect that value in the market valuation of their tokens.
Currently, there is only one oracle token in the top 100 cryptocurrencies: LINK, the native token of the Chainlink network. Pyth Network’s PYTH is the second highest-ranked oracle token, sitting at position 128 at the time of writing. The rest of the oracle tokens are ranked far lower, outside of the top 400.
In other words, while they provide an essential service to the crypto market, oracle tokens are not perceived as attractive investments by traders.
The core problem is that decentralized finance protocols do not provide a stable and reliable source of revenue. However, as the crypto market becomes increasingly institutionalized, new actors have a critical need for trustworthy data – both from TradFi into DeFi and, conversely, from on-chain environments back into traditional finance.
It therefore seems natural for Pyth to turn to this new market to secure long-term sustainability. This proposed pivot could allow the protocol to generate additional revenues, which would then be redirected to the Pyth DAO. The DAO would in turn be incentivized to allocate these new resources toward improving the token’s valuation, making it more attractive for investors.
Over the past few months, we have observed that protocols able to redistribute part of their revenues toward their tokens (for instance, Hyperliquid with its HYPE buyback program) have seen significantly greater success than their peers. This trend has also pushed other projects to consider adopting similar mechanisms.
The fact that Pyth was selected as one of the two oracles responsible for publishing U.S. government data on-chain is also a strong symbol of recognition, which could facilitate adoption by institutional players seeking reliable and easily accessible data for their own services.
Ultimately, it will be particularly important to follow the decisions made by the Pyth DAO regarding the allocation and use of these new revenue streams. All related discussions can be followed on the governance forum.
Pyth’s Outlook for 2026
Through this proposed institutional pivot, the Pyth contributors envision Pyth Network to become a significant provider of financial market data in a world where traditional finance increasingly embraces blockchain.
The goal is to expand Pyth’s coverage dramatically, adding hundreds of new price feeds per month to exceed 3,000 by the end of 2025, more than 10,000 by 2026, and over 50,000 by 2027. This expansion will span centralized and decentralized exchanges, OTC markets, and both permissioned and permissionless DeFi environments.
Each new feed would attract additional institutions and developers, mechanically increasing subscriptions and DAO revenues. These revenues would then reinforce a virtuous cycle: they finance data quality improvements, strengthen incentives for publishers and stakers, and consolidate PYTH’s token value.
In today’s ecosystem, where a token’s attractiveness is directly tied to a project’s performance and its ability to generate revenue, ensuring the protocol’s economic sustainability has become essential. With this proposed pivot, Pyth can position its token as an asset capable of capturing part of the value its protocol creates.
