Decentralized technology is not pushing banks out of finance. It is rebuilding the infrastructure they run on, according to Openpayd chief commercial officer Lux Thiagarajah, who described the shift as a re-platforming rather than a replacement. In his view, regulated institutions remain indispensable because KYC, AML, and prudential supervision will not be handed over to fully permissionless systems.
Thiagarajah, a former JPMorgan Chase and HSBC executive, said institutional blockchain adoption has moved away from front-end disruption and toward back-end settlement plumbing. The focus is no longer on turning every invoice into a programmable NFT. It is on money movement. He said the strongest institutional demand remains in fiat on- and off-ramp infrastructure, the layer that connects traditional currency systems with blockchain networks.
Stablecoins are moving from experiment to regulated production tool
He tied that change to a new regulatory environment. With the European Union’s Markets in Crypto-Assets regulation fully in effect and the U.S. GENIUS Act enacted in 2025, stablecoins have shifted from experimental wallet-based tokens to regulated account-based tools used in production settings. Institutions are chasing settlement speed. Companies embedding stablecoins into back-office operations can cut settlement times from days to seconds, but the “last mile” of converting digital value back into fiat remains the capability in highest demand.
Large financial firms are integrating decentralized tech into existing models
Thiagarajah pointed to JPMorgan’s Kinexys and Blackrock’s BUIDL fund as evidence that major financial players are not being displaced. They are adapting. Banks are integrating decentralized technology into existing operating models, not surrendering those models altogether. The pressure point is not whether blockchains work, but how different rulebooks are applied. MiCA leans on stricter, state-directed supervision in Europe, while the GENIUS Act in the United States emphasizes federal legal protections and the separation of banking and commerce.
That split creates a practical concern for global treasury teams: whether companies will have to maintain separate on-chain stacks for each jurisdiction. Thiagarajah said the answer should come from system design. If infrastructure is built around a single core ledger and compliance logic sits at the asset layer instead of the chain layer, then blockchains, wallets, and smart contract logic can remain aligned without forcing markets into isolated environments.
Interoperability, not regulation alone, is the bigger threat
He argued that the main danger is not the existence of rules, but liquidity fragmentation caused by incompatible compliance regimes. If eurozone liquidity is locked inside MiCA-compliant tokens while U.S. liquidity sits inside GENIUS-compliant tokens, moving value across borders could stay expensive even after major technical upgrades.
Thiagarajah also criticized MiCA’s transaction caps on U.S. dollar-denominated stablecoins in the European Economic Area. He said measures designed to protect the euro may introduce friction for European businesses, forcing them to take a longer route for settlement. Converting euro-backed tokens into the dollars needed for international goods and services could also raise foreign exchange costs. He added that unless the dollar’s role as the global reserve currency changes in a major structural way, markets are likely to remain fundamentally dollar-denominated for the foreseeable future.
On the question of whether regulation restrains growth, his answer was blunt. The bigger problem for banks and funds is uncertainty. In practice, “unclear” means “uninvestable.” From that perspective, laws such as MiCA and the GENIUS Act give institutions the formal permission they need to move from pilot programs to large-scale liquidity deployment. Batch-based settlement and multi-day processing may fade, but banks as regulated entities are not going away.