A crypto protocol that helps investors earn interest is paving the way for mainstream institutions to enter the world of decentralized finance (DeFi).
In a joint announcement, Aave (AAVE) says it’s partnering with blockchain security outfit Fireblocks to launch the world’s first permissioned DeFi platform.
The new Aave Arc liquidity pool will utilize the firm’s whitelisting framework to comply with anti-money laundering (AML) regulations and screen applicants via Know Your Customer (KYC) verification.
The press release says that regulatory-compliant DeFi could bring trillions of dollars worth of traditional investment capital into the cryptocurrency space.
“While approximately $255.9 billion is currently locked in DeFi, the market has largely remained untapped by institutions due to a lack of support for enterprise-grade risk management and KYC/AML requirements.