Many people may feel discouraged and wary about entering the Decentralized Finance (DeFi) space, as this hub is home to many hacks. Experts within crypto are optimistic that DeFi can be adopted more widely in the future.
Web3 executives share their views on DeFi adoption, from educating institutional investors to eliminating user-experience barriers for retail investors.
Anton Bukov (co-founder of 1inch Network) stated to Cointelegraph that recent events regarding centralised finance (CeFi), have highlighted the importance and value of DeFi. The executive believes it’s just “a matter of time” before the financial system switches to Web3 solutions. In terms of institutional DeFi adoption, Bukov noted that it’s essential to have a deep understanding. Bukov explained that:
“The key to DeFi adoption among institutional investors is a deep understanding of transparency benefits, trustless approach and self-custodian technologies.”
DeFi projects also received security advice from the executive. Bukov stated that security audits are essential. “My advice to any DeFi project is simple – don’t be lazy to do several security audits before releasing any update, this will save you a ton of nerves and highly likely – users’ funds,” he said.
Primex Finance’s co-founder, Dmitry Tolok, commented on the topic. Tolok believes that DeFi adoption may be accelerated if there are more insurance protocols. He explained:
“More insurance protocols are also needed to mitigate concerns related to potential hacks. The growth of such protocols would lead to the organic development and growth of DeFi.”
Cointelegraph was also informed by Tolok that investors will be more confident in a mature market that has more protections against vulnerabilities.
Related: Taproot was a year ago. Now, the Bitcoin community is working to unlock its DeFi potential
Alvin Kan, executive of BNB Chain, spoke out about the importance education to increase DeFi adoption. Kan stated to Cointelegraph that users need more education. Kan explained that:
“Given the permissionless and digital nature of DeFi, risks will always be present, and users need to understand how to do their own due diligence to minimize the risk they’re taking on.”
Jay Sullivan, founder of XSwap Protocol also echoed this sentiment. Sullivan also agrees that education is crucial for maintaining the safety of the space. Sullivan highlighted the importance of “teaching investors how to keep their funds safe.” Apart from storage, the executive believes that it’s also important to teach investors “what to look for” when looking to invest.
In addition to education, the executive highlighted how regulation will be a factor in wider DeFi adoption. “With the collapse of several centralized exchanges this year, investors have seen the importance of DeFi. However, for institutional investors to enter, we need to see the industry evolve,” he added.
Zachary Vann from World Mobile, an executive, stressed the importance of improving user experience. Vann said that DeFi navigation can be difficult and overwhelming for newbies. “Once the user experience is improved and the barrier to entry reduced it should help exponentially the amount of retail coming into DeFi,” he said.