Ripple CTO David Schwartz recently explained why DeFi and TradFi are not at odds and how tokenized real-world assets, on-chain credit and decentralized exchanges are creating financial products people actually want.
The official X account of RippleX shared insights from the Ripple CTO, who spoke on the first ever episode of the Onchain Economy series.
Can institutional adoption and decentralization work together?
In the first episode of the Onchain Economy series, @joelkatz says yes and offers that neutrality is key: https://t.co/bucofy7Zyl
He explains how tokenized assets and onchain credit are bridging the gap between… pic.twitter.com/zWbg8LpVAu
— RippleX (@RippleXDev) September 25, 2025
Schwartz highlighted that institutional DeFi is not a contradiction. This is as tech is coming for finance; with or without blockchain, the Ripple CTO added that this was bound to happen. He added that companies like Amazon and Uber need more financial services than the current system is able to provide them, and blockchain technologies are in the right place at the right time.
This week, Ripple revealed the next phase of institutional DeFi on the XRP Ledger, with a native lending protocol scheduled for release in XRPL version 3.0.0 later this year.
Ripple CTO makes crypto market prediction
Ripple CTO David Schwartz, predicts that DeFi will eat TradFi’s lunch in the years ahead: “I do think that defi broadly speaking, meaning blockchain smart contracts and all the whole ecosystem that’s being built around it is going to take a huge bite out of tradfi over the next couple of years.”
The big challenge, according to Schwartz, is that the blockchain space will have to produce the services that people want from the financial system.
Schwartz predicts that the DeFi space, aided by institutional adoption, would provide benefits such as tokenized real world assets, and tokenized loan and real estate portfolios, which would produce the products and services that people want out of a financial system.
Massive expansion coming to crypto space
Schwartz says, in his opinion, there is not any tension between institutional adoption and decentralization, as ecosystems are interested in layer-1 blockchains because of their decentralization and neutrality.
Schwartz thinks that the neutrality of blockchain might ultimately be the selling point that would lead to massive expansion in the crypto space: “So i think institutions will see the neutrality of blockchains is a positive for them rather than a negative because i think ultimately that will be the selling point and i think that’s all going to lead to just massive expansion and growth in the space.”
