The Roundtable: When Will DeFi Take Over?

Decentralized finance has a bright future, but how long will mainstream adoption and integration take?

With the war in Ukraine, the fallout from the pandemic and record levels of inflation, the U.S. economy has taken a blow in 2022. But it's not clear what, exactly, is causing the ongoing downturn. A group of finance experts joined Roundtable to discuss inflation, markets, policy and their continued prognosis for the economy. In this segment, the panel discusses the timeline for a future in which TradFi and DeFi comprise a  single, unified system. 

Marc Lopresti, managing director at Moneta Advisory Partners, says that full integration may take more than a generation. 

"Not in the near future, and maybe not even in our lifetimes," he says. "And I'll give you a reason: market penetration and relative scale. The crypto market Bitcoin and all the others combined came back over a trillion recently with the recent recovery that is still a pimple on the butt of the larger [TradFi] world. So, until we get scale, which is gonna take additional institutional adoption [and] regulatory confidence, regulatory certainty."

He continues, "Once we start to get to scale and crypto assets representing a significant component of the overall financial system, that's when you might start seeing [full integration]. But I don't see that in the next three, five, or even 10 years. I think that's way out."

David Zell Founder, Bitcoin Policy Institute, says integration will begin with the establishment of basic standards and common protocols. 

"On the payment rail layer, I expect a convergence on a single protocol for value transmission, the same way we saw a convergence on a single protocol for communications transmission," he says. "When you have that, you get network effects that become exponential. Historically that's unlocked a ton of entrepreneurship, when new business models have driven down consumer costs and made life better for people."

He continues, "I'm not saying I am one-hundred percent sure that that Bitcoin is going to be that sort of shelling point for people, corporations, and governments that are seeking a neutral reserve asset, but I strongly suspect it will be the case. We're trending toward an open monetary network in which corporations like Visa and MasterCard will compete with corporations like Square to offer a better consumer experience on those networks."

Watch the full discussion below:

Roundtable Guests:

Jon Najarian, Co-Host, CNBC Halftime Report

Marc LoPresti, Managing Director, Moneta Advisory Partners

David Zell, Founder, Bitcoin Policy Institute