ARK Invest Challenges a16z’s View That TradFi Will Skip DeFi

ARK Invest’s director of research has publicly disagreed with venture firm a16z crypto’s argument that traditional financial institutions will favor permissioned blockchain systems over decentralized finance.

ARK’s Position on Public Blockchains

Lorenzo Valente said in a Wednesday post on X that public blockchains have already shown stronger results than private blockchain efforts, pointing to the growth of tokenized assets on Ethereum and other open networks as evidence.

He argued that crypto-native companies such as Circle and Coinbase, rather than established financial institutions, are better positioned to build the next generation of financial infrastructure.

a16z’s Counter Argument

A day before Valente’s comments, a16z crypto had posted that traditional financial institutions are not adopting DeFi directly but are instead selectively using blockchain technology that fits within their existing compliance, governance, and operational frameworks. The firm said banks and asset managers will likely build what it called “programmable financial infrastructure,” borrowing blockchain features like tokenization and atomic settlement while keeping systems permissioned and under institutional control.

Third Voice Joins the Debate

Sentora co-founder Jesus Rodriguez also weighed in against a16z’s thesis, arguing that institutions are more likely to adopt DeFi’s core infrastructure directly while adding compliance, custody, and other enterprise-level controls on top of it, rather than building entirely separate permissioned systems.

The disagreement highlights a broader industry debate over how traditional finance will ultimately integrate blockchain technology, whether through open, public networks or through more controlled, permissioned alternatives built specifically for institutional needs.