How to Bring Off-Chain Assets to DeFi

How to Bring Off-Chain Assets to DeFi


The recent GameStop short squeeze has brought decentralized finance (DeFi) into mainstream public consciousness. Well-known crypto influencers such as Caitlin Long have espoused decentralized exchanges as an alternative to traditional clearing and settlement infrastructure. Others, including me, have suggested that decentralized credit markets can reduce systemic risk by enhancing financial market transparency. 

Ajit Tripathi, a CoinDesk columnist, is the Head of Institutional Business at Aave. Previously, he served as a fintech partner at ConsenSys and was a co-founder of PwC’s U.K. Blockchain Practice.

In this article we examine some of the key considerations for transitioning from crypto-native decentralized markets to decentralized real-world asset markets at institutional scale.

Institutional interest in DeFi

In my experience, the level of institutional interest in DeFi is currently much stronger than commonly assumed. This is because of five main reasons:

First, unlike enterprise blockchain projects and proofs of concept, which in my opinion

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