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DeFi Was Designed to Supplant TradFi—Not Rely on It
Decentralized finance (DeFi) emerged with an ambitious promise: to overhaul conventional finance and provide equitable access to capital for all, particularly those without banking services. Years later, that commitment is still mostly unmet.
The current DeFi ecosystem remains significantly reliant on conventional financial systems. Stablecoins, essential to DeFi, are supported by bank deposits and government securities. Regulated institutions manage fiat on-ramps. Pricing information is sourced from centralized exchanges. Access to DeFi applications is still dependent on app stores, web browsers, and cloud services managed by major corporations. In truth, DeFi didn’t supplant TradFi—it encased it.
This reliance poses a significant obstacle for unbanked groups. The issue isn't a shortage of DeFi offerings. It's the absence of fundamental financial infrastructure. DeFi relies on stable internet, legal identification, secure custody, and access to banking services—factors that many individuals globally lack.
Consequently, DeFi has primarily favored traders, funds, and institutions that are already part of the financial system. Wealth, not need, drives adoption. Speedy finance hasn't necessarily turned into equitable finance.
For DeFi to genuinely transform the world, it should prioritize the development of new financial infrastructures—payment systems, identity verification, custody solutions, and credit frameworks that operate independently of banks—rather than concentrating on eye-catching products. Until that time, DeFi continues to be inventive, yet not fully developed.