DeFi's Zero Onboarding Costs Could Bank 1.4 Billion Unbanked

Anton Bukov, co-founder of 1inch Network, highlighted the transformative potential of decentralized finance (DeFi) in making financial services accessible to a broader audience. Speaking at an event, Bukov emphasized that DeFi's near-zero onboarding costs give it a significant advantage over traditional financial institutions.

Traditional banks typically incur costs ranging from $100 to $300 to verify and onboard each user, while internet banks reduce this to around $20 to $30. In contrast, DeFi platforms require only a smartphone and an internet connection, effectively eliminating onboarding costs. This cost efficiency is particularly beneficial for the 1.4 billion unbanked individuals globally who face prohibitive costs and logistical challenges in accessing traditional banking services.

Bukov explained that the high costs associated with traditional banking make it impractical for many individuals to access financial services. DeFi, however, removes these entry barriers, allowing even those in remote or underserved regions to participate in global financial flows through stablecoins like Tether’s USDT. This democratization of finance could significantly impact regions where traditional banking infrastructure is lacking.

In addition to financial inclusion, Bukov noted that DeFi is becoming a global hub for liquidity. Cryptocurrency is evolving into an autonomous economic sector, facilitating the movement of hundreds of billions of dollars across decentralized platforms. This liquidity supports innovation, yield generation, and cross-border capital flows, making DeFi a crucial component of the global financial ecosystem.

Bukov urged nations to adopt favorable regulations that promote broader access to DeFi's benefits. He emphasized that increased trade and financial integration, facilitated by DeFi, contribute to global economic success. As internet penetration continues to grow worldwide, DeFi's cost-efficient infrastructure could play a pivotal role in democratizing access to finance and global markets.