Bitwise CEO Hunter Horsley States DeFi Will Quietly Disappear by Year-End and Rebirth as 'Onchain Finance'
He pointed out that the traditional DeFi model faces multiple challenges such as liquidity fragmentation, competition from centralized platforms, and regulatory pressure, while onchain finance will integrate institutional-level compliance with onchain efficiency, achieving a transition from experimental protocols to mainstream financial infrastructure.
In terms of market mechanisms, funds are flowing from high-risk DeFi protocols to compliant onchain platforms, with institutions and traditional financial capital accelerating their entry. Beneficiaries include institutions like Bitwise that provide onchain products, while pure decentralized protocols and retail liquidity providers are under pressure.
Source: Public Information
ABAB AI Insight
Hunter Horsley, as CEO of Bitwise, has previously advocated for Bitcoin ETFs and institutional crypto adoption. This judgment continues his observation of DeFi's transition from the frenzy of 2020-2021 to maturity, having pointed out multiple times in reports the pressure that centralized exchanges and compliant platforms exert on traditional DeFi.
In terms of capital pathways, Bitwise mobilizes institutional client resources and product design capabilities to transform DeFi experience into onchain finance solutions, aiming to attract traditional financial capital by forming stable fee income and expanding asset management scale through compliant modular products.
Similar to the evolution of early crypto lending protocols to CeFi platforms, the current DeFi ecosystem is in a controlled phase of transitioning from high-risk experiments to institutional-level onchain finance, reshaping market narratives and capital allocation directions through voices of industry leaders like Horsley.
Essentially, this reflects capital concentration and regulatory changes: the rebirth of DeFi into onchain finance directly embodies the trend of compliance integration, accelerating the concentration of onchain capital from fragmented protocols to scaled platforms through institutional entry, reshaping the pricing power structure of crypto finance from decentralized wild growth to regulated mainstream infrastructure.
ABAB News · Law of Cognition
The more extreme decentralization becomes, the more inevitable the return of institutions.
When narratives die, new forms signify the rebirth of capital.
The higher the compliance efficiency, the more durable the leverage of onchain finance.