According to Merline Egalite, co-founder of Morpho, fintech firms are expected to transition to decentralized finance (DeFi) lending within three years due to its permissionless nature. DeFi provides more accessible loans with lower fees than traditional lending services. The integration of DeFi is seen as a strategic move for fintechs in order to remain competitive, as it offers higher rates and the potential for better financial products. Morpho, the second-largest decentralized lending protocol, has over $5.5 billion in total value locked (TVL), significantly less than AAVE's $31 billion. The increasing recognition of DeFi's benefits, such as the absence of financial intermediaries, is also pushing more fintech firms to explore these options. As DeFi lending continues to grow, it has reached a new all-time high of $66.7 billion in total value locked, indicating a significant interest in decentralized solutions despite the setbacks experienced by centralized finance (CeFi) lenders in recent years.

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