Ripple CEO: DeFi Compliance to Lead Industry Trends in 2024

Monica Long, the president of the global payment network Ripple, anticipates a significant shift towards compliance in the decentralized finance (DeFi) sector, marking it as the most pivotal advancement in the industry for the year 2024.

DeFi represents a transition from traditional centralized financial systems to peer-to-peer financing facilitated by blockchain technology. With CoinGecko reporting a market capitalization of $79.5 billion for the sector, regulatory bodies worldwide are increasingly focusing on ensuring compliance with existing financial laws.

The United States is taking steps to expand oversight over cryptocurrencies and DeFi. New regulations, introduced by the Securities and Exchange Commission, redefine terms such as "dealer" and "government securities dealer," necessitating more market participants to register with the regulator.

Monica Long believes that DeFi regulation is ripe for innovation in the current year. She emphasizes that compliance should be non-negotiable within the industry, especially in applying existing rules to DeFi use cases such as decentralized exchange trading.

Statista forecasts that the average revenue per DeFi user will reach $1378 by 2024. Much of this revenue will stem from decentralized exchanges (DEXs), platforms enabling users to trade cryptocurrencies without a central authority. For instance, Uniswap, one of the most popular DEXs, generated nearly $10 million in trading fees for its liquidity providers over the last seven days.

Long predicts that compliance will drive real-world utility and widespread adoption, necessitating integration with existing infrastructure and systems in the coming years.