DeFis Path to Mass Adoption Goes Through Fintech Firms, Centralized Exchanges, Morpho Labs Chief Says [Video]

The path to mass adoption of decentralized finance (DeFi) passes through fintech firms and centralized exchanges, which together form a disruptive force with more incentive to switch to the new infrastructure than traditional finance (TradFi) incumbents, according to Paul Frambot, CEO of DeFi lending firm Morpho Labs.

Just as the auto industry, for example, has distribution and manufacturing sectors, so does finance. Financial technology companies – fintechs – such as Revolut and Robinhood (HOOD) provide the distribution frameworks for the digitization of financial services. But they still rely on TradFi as the manufacturer, Frambot said.

That will change, he said, and points to several pieces of evidence for his thesis that DeFi will scale through a combination of centralized crypto exchanges and fintech firms.

For instance, many fintechs and exchanges have noted the success U.S.-listed crypto exchange Coinbase (COIN) has had so far with Base, its layer-2 blockchain, and decided to build or partner with layer 2s …