ARK Invest pushes back against a16z’s view that “traditional finance will adopt blockchain rather than DeFi”: Institutions will increasingly rely on DeFi infrastructure going forward.

ARK Invest Research Director Lorenzo Valente published a paper refuting a16z crypto’s view that “traditional finance will adopt blockchain rather than DeFi”, arguing that institutions will increasingly rely on DeFi infrastructure in the future. Valente noted that public blockchains have outperformed private chain projects in real-world development, citing the growth of tokenized assets on open networks like Ethereum as evidence. He also argued that crypto-native firms such as Circle and Coinbase are better positioned than traditional financial institutions to build next-generation financial infrastructure. a16z crypto had previously stated that banks and asset management institutions would not directly adopt DeFi, but would instead opt for blockchain technologies that meet existing compliance, governance, and operational requirements—including features like tokenization and atomic settlement—while retaining permissioned systems and institutional control. Sentora co-founder Jesus Rodriguez also took issue with a16z’s stance, arguing that institutions could adopt DeFi’s underlying infrastructure and layer on compliance, custody, and other enterprise-level controls on top of it.