Traditional Finance versus Decentralized Finance

The growing interaction between traditional finance and decentralized finance is one of the most important shifts we are seeing as global finance evolves.

In the latest installment of Decrypting Crypto, Visiting Fellow Yaya J. Fanusie and Research Assistant Rohan Mistry explain that although these systems have developed in separate ecosystems, increased private sector interest in financial innovation and rising regulatory scrutiny of DeFi are driving efforts to bring decentralized finance under a broader regulatory umbrella.

Fanusie and Mistry examine:

• How TradFi institutions like banks, stock exchanges, and central banks operate,
• How DeFi platforms like Aave, Uniswap, and MakerDAO offer a radically different model powered by blockchain,
• The core tensions between centralized control and decentralized access,
• Risks and vulnerabilities in DeFi,
• Why some TradFi giants are leaning into DeFi-inspired tech,
• And where global regulators are focusing their attention to shape the future of finance.