CeFi’s Crypto Expansion

Key Insights

• CeFi’s new expansion into crypto is largely a U.S.-driven phenomenon, enabled by evolving regulatory clarity and competitive pressure, rather than a global shift toward decentralization.
• Most activity targets existing crypto demand, such as perpetuals trading and tokenized assets, rather than attempting to replace onchain infrastructure or legacy financial systems.
• Regulatory arbitrage creates collaboration opportunities between CeFi and DeFi, with Coinbase–Morpho illustrating how centralized platforms can integrate onchain protocols to bypass licensing hurdles and scale lending services.
• Backend substitution and deep infrastructure adoption remain long-term goals, constrained by technical, regulatory, and network challenges; near-term progress will be limited to narrow, efficiency-driven use cases.

Introduction

In recent months, we’ve seen a wave of announcements from major CeFi players signaling deeper moves into crypto. Robinhood’s introduction of tokenized stocks and Coinbase’s launch of a perpetuals exchange are two notable examples. While these developments have often been interpreted as evidence of CeFi “going onchain,” this trend is not entirely new. The regulatory environment has shifted, with American firms now engaging more seriously in a movement that has been progressing globally for some time.