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Decentralized finance (DeFi) may only be years away from mainstream adoption, according to Chainlink co-founder Sergey Nazarov. However, significant regulatory and institutional hurdles must still be cleared before it can achieve global scale.
“I think we’re about 30% of the way there,” Nazarov said during an interview with MN Capital founder Michael van de Poppe published to YouTube on Tuesday.
DeFi, which is peer-to-peer financial services built on blockchain networks, could reach 50% global adoption once clearer regulation and legislation can explain why it is reliable, according to Nazarov.
Other industry executives have shared a similar view. Curve Finance founder Michael Egorov said in February that the biggest hurdles to DeFi adoption come from regulatory and legal uncertainty, as well as the need to comply with Know Your Customer (KYC) and Anti-Money Laundering (AML) requirements.
He also pointed to issues around liquidity and transparency of transactions and technical security risks.
US government approving DeFi may start a domino effect
Nazarov said that clarity will start with the US and spread quickly. “A lot of governments follow what the US does because they want to be compatible with the US financial system,” he said.
Sergey Nazarov (left) spoke to Michael van de Poppe (right). Source: Michael van de Poppe
Meanwhile, Michael Selig, who serves as chief counsel for the crypto task force at the US Securities and Exchange Commission, recently said, “When we’re thinking about DeFi, it’s something of a buzzword,” and the focus should be more on onchain applications, the features of these applications and whether there is an intermediary involved.
Nazarov said DeFi global adoption will reach 70% when there is a clear and efficient pathway for institutional users to put their capital and clients’ money into DeFi.
He anticipated that full global adoption would only arrive once DeFi grows large enough that its capital base can be meaningfully compared to the funds allocated within traditional finance.
100% DeFi adoption in 2030, predicts Chainlink founder
“I think we’ll be at 100% when you have those kinds of pie charts to show the percentage of client money or institutional capital that is in a DeFi system versus a TradFi system,” he said.
“I think there are going to be charts like this in 2030,” he said, emphasizing that the charts will look similar to ones showing the percentage of the treasury market to stablecoins. While he said it still isn’t a huge percentage, it starts the momentum.
“As that percentage gets bigger, I think people then start saying, oh okay, wow, this percentage of all institutional capital is now in this blockchain-based form,” he said.
“Then you go from the early adopters to mainstream,” he added.
Related: UAE’s new financial law pulls DeFi and Web3 into regulatory scope
DeFi lending protocols have seen significant momentum recently, driven by growing institutional adoption of stablecoins and tokenized assets.
According to recent Binance Research, DeFi lending protocols have increased by more than 72% year-to-date, rising from $53 billion at the beginning of 2025 to over $127 billion in cumulative total value locked.
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