DeFi Shifts Focus from Retail to Enterprise Clients
DeFi protocols that once aimed to create user-friendly apps for retail investors are now shifting their focus to providing backend infrastructure for large technology companies. This pivot, which has been gaining traction since at least 2023, involves offering white-label solutions for fintech firms.
The idea of 'DeFi-as-a-service' was first proposed in 2023, when several protocols began offering customizable DeFi solutions for other businesses.
Despite the promise of 'consumer-friendly' DeFi apps since around 2020, these platforms have struggled to gain mainstream adoption. The main obstacle is that users require a certain level of crypto literacy, which many people are unwilling or unable to acquire.
For investors holding governance tokens in protocols making this pivot, the implications are mixed. On one hand, enterprise contracts provide stable recurring revenue, which should support token valuations. However, this shift can also reduce a protocol's visibility and narrative appeal, potentially affecting token prices.