The decentralized finance (DeFi) market is rapidly growing and is predicted to surpass traditional financial institutions in the near future, according to industry experts. Mike Belshe, CEO and co-founder of BitGo, expressed his belief that DeFi will replace institutions within the next three to four years. Belshe highlighted the potential of innovative use cases like automated market makers (AMMs), which have the ability to disrupt traditional market makers. AMMs eliminate the need for human brokers by plugging market maker research into smart contracts, allowing investors to review the code and regulators to monitor the deals. However, there are still challenges associated with AMMs, such as code bugs and security issues. Belshe emphasized the importance of addressing these concerns before DeFi can overtake traditional financial institutions. Currently, BitGo is focused on enabling DeFi for the developer community and is working on adding features around DeFi for smart contracts. Belshe also discussed the potential for crypto companies to eventually surpass traditional banks, stating that software is changing the financial services sector and larger companies need to adapt to avoid falling behind. He noted that smaller crypto companies are more agile and can iterate faster, which has been seen in the tech sector for decades. Furthermore, Belshe highlighted the interest of big tech companies like Google Cloud in DeFi, which puts traditional banks at a disadvantage. Shifting the conversation, Belshe expressed his passion for the approval of a spot-based Bitcoin exchange-traded fund (ETF) by the SEC. He believes that an approved ETF would provide a safer investing structure and allow individuals to access the asset class through regulated and monitored traditional firms, reducing the risk of insolvency and bad actors in the industry.
BitGo CEO Mike Belshe asserts that institutions will be entirely replaced by DeFi