Will 2023 be the year of institutional DeFi adoption?

Despite a potential regulatory crackdown, 1inch Network’s Sergej Kunz believes institutions will start adopting DeFi on a large scale.

Welcome to Forkast Forecasts 2023. In this series, leaders, innovators and visionaries in blockchains share their industry predictions for the year ahead.

Sergej Kunz

Sergej Kunz is the cofounder of 1inch Network, a decentralized finance (DeFi) aggregator.

Previously, Kunz served as the chief executive officer of renewable fuels firm Bulktrade GmbH, and as a software engineer for Porsche.

Predictions for 2023

Institutional players will start adopting DeFi

“1inch’s technology is based on our open-source smart contracts and our architecture, which is an institutional product. We opened a company in Switzerland to get the right license and to offer the same efficient technology for institutional players. So banks can easily exchange cryptocurrencies by selling crypto without interacting with brokers or people in between. They just need to use an API or smart network directly, and I’m pretty sure they will.”

“JPMorgan already built a prototype based on Uniswap and Ethereum blockchain as a pilot project for exchanging fiat currencies between banks. It’s not very efficient. When I was speaking with JPMorgan the last time, I showed them our algorithm and they said ‘wow, this will change the world.’”

Regulators might crack down on DeFi

“Next year, the regulators will try to introduce a framework for DeFi. I hope not because it’s still early for them because they need to be educated first. We try to participate in different groups, and different countries as a kind of advisor, to advise and to explain how [DeFi] works. Real decentralized protocols actually don’t need any kind of traditional regulation.”

Users will flock to decentralized exchanges and protocols

“We benefit from what happened previously with FTX. More people are starting to use self-custody wallets, decentralized exchanges and aggregators. I personally use Uniswap for passive income… Why should I trust a person when I can just use a program which is solid and secure? So I see I see more people coming into the DeFi space and using aggregators.