According to CoinDesk, DeFi builders must fundamentally shift their approach to win over institutional investors. Ben Nadareski, co-founder and CEO of Solstice, argues that the industry needs to move beyond thinking of themselves as software teams handling money to becoming financial asset managers who write code. The current approach of anonymous teams controlling multi-signature wallets is viewed by risk committees as an operational risk they cannot price effectively.
As reported by CoinDesk, institutions are seeking accountability that goes beyond code quality. Risk committees assess people and processes, not just software, and want to know who signed off on decisions, who can move funds, and what happens during critical incidents like 3am compromises. The current DeFi model of anonymous teams controlling protocols through multisig wallets is viewed as a liability rather than an innovation by institutional investors.
According to the analysis, practical accountability measures include real-time verifiable reserves and controls preventing single individuals from moving significant amounts of money. These standards align with institutional practices and represent the bare minimum for serious financial stewardship. The approach allows DeFi to maintain its openness, composability, and permissionless rails while addressing institutional concerns about accountability.
As reported by CoinDesk, the institutional audience has already arrived and is managing real money on DeFi rails. The platforms that win in the coming years will need to include Galaxy and Susquehanna alongside individual users in Lagos, with both having the same access and protections. The industry faces a choice between building accountable systems themselves or waiting for regulatory intervention to force changes.
