CoinDesk: Wall Street’s crypto push is blurring the line between TradFi and DeFi

News Editor

2026-08-16 12:05:50

According to CoinDesk, the boundary between traditional finance and decentralized finance is becoming less distinct as Wall Street firms and global financial institutions move deeper into digital assets. Bitwise CEO Hunter Horsley said the old trade of being long bitcoin and short bankers is over, arguing that major institutions are now working from the other side of the crypto market and helping expand access to digital assets. He pointed to two financial institutions with more than $1 trillion in assets under management each that approved crypto products this summer despite a bear-market backdrop. Sygnum Chief Investment Officer Fabian Dori said the relationship between banks and the crypto sector has changed in a structural way. In his view, banks have shifted from resisting digital assets to building, supporting, and distributing them through custody, tokenization, and compliant trading. He said rising client demand and clearer regulation, rather than short-term market cycles, are driving the change. Anchorage Digital CEO Nathan McCauley added that client composition over the past two years increasingly reflects convergence between traditional finance and crypto finance, with large institutions preferring to work with specialist crypto infrastructure providers instead of building systems on their own.

According to CoinDesk, the line between traditional finance, or TradFi, and decentralized finance, or DeFi, is getting harder to define as Wall Street firms and financial institutions worldwide step further into digital assets.

Bitwise CEO Hunter Horsley said the era of 「long bitcoin, short bankers」 is over. Financial institutions, he said, are moving to the other side of the crypto industry and helping drive broader adoption of digital assets.

Horsley said that this summer, two financial institutions with more than $1 trillion in assets under management each approved crypto products during a bear-market environment. He said that points to a wider effort by large institutions to expand the ways clients can access digital assets.

「This year everyone put on the crypto jersey. Now, everyone is working for crypto,」 Horsley said.

He also said institutions managing more than $1 trillion in client assets would not have opened related services during the crypto market downturn in 2022, but are now actively embracing the sector.

Sygnum Chief Investment Officer Fabian Dori said the relationship between banks and the crypto industry has undergone a structural shift. In his words, the old 「long bitcoin, short bankers」 trade is finished, and banks have moved from resisting digital assets to building, supporting, and distributing them through custody, tokenization, and compliant trading.

Dori said the change is being driven mainly by rising client demand and gradually clearer regulatory rules, not by short-term market cycles.

Anchorage Digital CEO Nathan McCauley said his firm’s client mix over the past two years has increasingly reflected the convergence of traditional finance and crypto finance. Large financial institutions, he said, usually choose to work with specialist crypto infrastructure companies instead of building their own technology stacks.

In recent years, more financial institutions have entered the crypto sector, including Swissquote, DBS, BBVA, BNY Mellon, Credit Suisse-related entities, Morgan Stanley, and Charles Schwab.

This article was originally published by Bit.Fan. For more cryptocurrency news and market insights, visit www.bit.fan.

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