Yigit Taha OZTURK 
Institutional investors remain cautious about adopting decentralized finance (DeFi) solutions. SilentSwap founder Shibtoshi highlighted key concerns preventing institutional DeFi adoption: lack of privacy, unstandardized compliance regulations, and legal uncertainties.
Challenges of DeFi for Institutional Players
According to Shibtoshi, the high transparency of blockchain transactions clashes with corporate needs to protect sensitive information, such as trading strategies, payroll details, and B2B agreements.
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“The main concerns — regulatory uncertainty, privacy limitations, and complex user experience — are real, but solvable. Innovations in privacy-preserving protocols are making DeFi increasingly compatible with enterprise needs.”
Regulatory inconsistencies across jurisdictions further hinder adoption. Are DeFi tokens securities? How are DAOs legally accountable? These questions remain unanswered.
The Risk of Overregulation in DeFi
The U.S. Congress recently repealed the IRS broker rule, which required DeFi platforms to report customer transactions. However, DeFi still faces major regulatory threats.
Crypto entrepreneur Artem Tolkachev warned that strict compliance measures could undermine decentralization in DeFi:
“Overregulation increases censorship risks and shifts control from users to third-party intermediaries and large institutions.”
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