DeFi & NFT

Story: DeFi Protocols Need Real Financial Oversight to Win Institutional Money

By Sakamoto Nashi

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Why Institutional Investors Still Hold Back. Large investors — pension funds, asset managers, family offices — aren't allergic to risk.

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Bitcoin Holders and the Reinsurance Play. Separate from the governance question, there's a strategy getting attention for Bitcoin holders…

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The Harder Work of Changing How DeFi Operates. None of this is easy to implement. Transitioning a DeFi project toward genuine financial…

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Decentralized finance has a trust problem. Big investors want in — but they can't get comfortable with how loosely most DeFi projects run their books.

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The argument is pretty straightforward: DeFi developers need to stop acting purely like software engineers and start behaving more like financial managers.

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The proposed fix isn't complicated, at least in concept. DeFi projects should adopt financial management practices that mirror what traditional finance already does — rigorous…

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And there's an urgency here. The window for DeFi to define itself on its own terms, before regulators do it instead, probably isn't wide open forever.

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Separate from the governance question, there's a strategy getting attention for Bitcoin holders specifically: generating income through reinsurance.

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See also: MetaMask Integrates AI Agents in DeFi, Security Questions Persist

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The appeal is obvious. Bitcoin's price swings are brutal, and most holders either ride them out or panic-sell at exactly the wrong moment.

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It's basically bringing old-school risk management into a new-school asset class. That convergence is probably inevitable, but the pace of adoption is unclear.

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None of this is easy to implement. Transitioning a DeFi project toward genuine financial accountability means rethinking how it's structured from the ground up — governance…

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There's also a communication piece that the industry tends to underestimate. Even if a protocol genuinely improves its financial management practices, it won't attract larger…

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Read also: Morpho Raises $175 Million, Establishing Itself as a Major Player in French DeFi

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So the DeFi sector is basically being asked to grow up in two directions at once — internally, by building real accountability structures, and externally, by learning to talk to…

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