The financial landscape is at a pivotal juncture. For years, the conversation has positioned traditional finance (TradFi) and decentralized finance (DeFi) as opposing forces. However, a new, more nuanced reality is taking shape — one defined not by replacement, but by convergence. The latest Citi Securities Services Evolution 2025 report provides a comprehensive look into this evolution, and we’re honored that our Managing Partner was a featured contributor, offering his insights on this significant shift.
TradFi as the Gateway, DeFi as the Engine
At its core, this new era is not about a complete takeover by new technology, but a powerful partnership. It recognizes that traditional financial companies (TradFi) will continue to serve as the trusted front door for customers — the regulated “gateway” — while decentralized finance (DeFi) provides the underlying technology to make everything faster and more efficient — the “engine.”
“The future of finance isn’t a replacement of one system with another, but a convergence of traditional and decentralized finance. This means that while TradFi firms will remain the trusted institutions for institutional custody and act as the gateway for digital products, DeFi will provide the engine for speed and efficiency.”
— Kyle. J Baron, Managing Partner at BCW Group
This statement encapsulates the hybrid model that will define the next decade of finance. It’s a recognition that the trust and regulatory adherence of traditional institutions are indispensable. Simultaneously, the underlying technology of DeFi offers an unparalleled engine for transforming legacy processes and unlocking liquidity.
This hybrid model is not just theoretical; it’s being built today. At BCW Group, we are at the forefront of this convergence by creating the tools institutions need to participate directly and securely in the DeFi ecosystem. A prime example is stakeFi, a leading staking infrastructure provider. stakeFi is a one-stop shop combining whitelabel validator nodes, dashboards, and APIs to empower institutions with the execution and reporting capabilities required to offer best-in-class staking services, all built on an institutional-grade backbone.
The Citi report substantiates this with compelling data, showing that the industry expects nearly
10% of total market turnover to be conducted using digital assets and tokenized securities by 2030. This isn’t just a demand from the market; it’s being actively built by the world’s leading financial infrastructures. The report highlights significant modernization efforts from institutions like ASX and Brazil’s B3, which is re-architecting its clearing platform for near 24/7 operations to support global cycles. Likewise, leaders from Euroclear emphasize a pragmatic, collaborative approach to drive scale in digital assets, moving beyond experimentation to create live, value-driven solutions.
Building the Bridge Between Two Worlds
This convergence requires building robust bridges between the established, permissioned systems of TradFi and the open, programmable networks of DeFi. The report notes the rise of hybrid models that offer the control institutions require while leveraging the core benefits of decentralized technology.
This is where pioneers from the Web3 space are providing critical infrastructure. As Sergey Nazarov, Co-Founder of Chainlink, notes in the report, overcoming fragmentation through seamless interoperability is key to creating a single, unified global financial system. At the same time, as institutional capital flows into this space, the need for robust security and compliance becomes paramount. Esteban Castaño, CEO of TRM Labs, highlights this very point, emphasizing that the promise of DeFi can only be realized if the ecosystem has the right tools to manage risk and ensure regulatory adherence. These technologies provide the trust and security layer necessary for institutions to engage with digital assets confidently.
The Accelerating Role of Generative AI
This evolution isn’t happening in a vacuum. Other transformative technologies are acting as powerful catalysts, and the Citi report places a significant focus on Generative AI (GenAI). The statistics are staggering:
86% of financial firms are already running GenAI pilots.
One of the most immediate applications is in solving historically stubborn challenges. For instance, 83% of brokers are now using GenAI to streamline and automate client onboarding. From back-office reconciliations to enhancing risk monitoring, GenAI is set to become a core operating technology across the trade lifecycle.
Harnessing these parallel technological shifts — DeFi and GenAI — is the key to building the next generation of financial services. As a premier partner of Google Cloud with a specialization in GenAI, BCW Group is uniquely positioned at this intersection. We are actively helping financial institutions build the infrastructure and intelligence needed to thrive in this new, converged landscape, turning the promise of efficiency and innovation into a practical reality.
The path forward is clear. The future of finance is not a zero-sum game between the old and the new. It is a sophisticated integration that leverages the strengths of both, and we are excited to be at the forefront, building that future alongside our partners and clients.
