Aave Labs founder Stani Kulechov stated that cryptocurrencies have the opportunity to attract traditional financial participants who have turned to non-traditional financial technologies after being let down by banks.
"Due to poor banking experiences, we are seeing a significant amount of financial business shift towards fintech, and fintech applications have been able to capture a large market share," Kulechov said while speaking at EthCC 2025.
He added that Aave Labs, which developed the decentralized lending and liquidity platform Aave protocol, along with other decentralized finance projects, has been "exploring how to truly bring all this utility into a more decentralized medium."
"Over 60% of the population has some form of digital wallet. While not on-chain, they have some digital means to interact with specific transactions," Kulechov said.
"Currently, there has been a massive adoption of digital finance, and the continuation is how to bring this large-scale application on-chain."
Kulechov stated that the tokenization of real-world assets presents a "trillion-dollar opportunity" for the cryptocurrency industry to engage with traditional finance.
"There are real estate, government bonds, stocks, corporate bonds, and a range of other asset classes that can be processed more efficiently in a transparent ledger and a more programmable environment," he added.
Kulechov said that if the cryptocurrency industry "can bring all these traditional assets on-chain," it can create a more efficient environment for these assets and can "go beyond building," creating "assets that cannot exist due to these inefficiencies."
"DeFi is the only technology that can do this in a borderless manner," he added.
However, Kulechov acknowledged that decentralized finance "is not really known to the public," and many protocols, including Aave, are "still far behind" in terms of user numbers compared to some fintech applications.
He said DeFi needs to present a "clear value proposition" and must address "real problems with good solutions" to have a chance at mass adoption, adding:
"If we want to compete with traditional finance, if we want to change the world, we need to do things 10 times better."
"Your product needs to be 10 times better," he said.
"When we introduce traditional assets and traditional value chains, we must provide something better. There needs to be a better value proposition: simplicity and accessibility," he added.
Some fintech companies have begun using blockchain technology, including BlackRock, which launched an Ethereum-based tokenized money market fund in March 2024, with a total value growing to over $2.8 billion.
The company also applied in April to create a blockchain-based share class for its government bond trust fund, which will use blockchain to record share ownership.
Asset management firm Libre Capital announced in April that it would tokenize $500 million of Telegram debt, aimed at qualified investors, which can be used as collateral for on-chain lending.
Related: JPMorgan gives Circle a "reduce" rating, with a target price of $80 by the end of 2026.
Original article: “Aave Labs Founder: Traditional Finance May Turn to On-Chain Due to ‘Poor Banking Experience’”
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