This report was written by Tiger Research . The power dynamic in the decentralized finance (DeFi) lending sector is gradually shifting from project agreement parties to professional operators who hold risk control decision-making power. Entering the industry essentially boils down to one choice: borrow others' analytical capabilities, export those capabilities, or build and control their own analytical capabilities.
Key points
- The decentralized finance (DeFi) sector is giving rise to entirely new asset management roles, marking the end of an era in which protocols and community governance have taken center stage in the industry.
- The sector is still in its early stages, but capital and channel resources have rapidly converged on leading risk management teams, whose past performance is becoming a core reference standard for institutional entry.
- There are currently three main entry paths in the industry: channel distribution (operation team provides backend support), asset supply (offline assets are put on the blockchain), and self-operation (self-built team becomes risk operator).
- The path to entry directly determines the main player's discourse power, required core capabilities, and potential risks.
- The core decision for the industry is not whether to enter the decentralized finance (DeFi) market, but how to divide responsibilities: which risk control decision-making powers should be delegated to external parties, and which core permissions should be retained and controlled internally.
I. Risk Operator: Professional On-Chain Asset Management Service Provider
Traditional finance has long separated decision-making and transaction execution responsibilities. Now, as the crypto market matures, various specialized functions have also formed dedicated professional operating entities.
Traditional financial function division
Asset manager: The core decision-making center for fund operation, formulating overall investment strategies and issuing specific execution instructions to the asset custodian.
Asset custodian: responsible for the safekeeping and custody of assets, strictly following the manager's instructions to complete investment operations and supervising asset security throughout the process.
Channel distributors: They sell fund products to investors and complete market fundraising and fund collection.
The crypto industry has evolved a corresponding functional system. Early decentralized finance relied entirely on smart contracts, but market practice has proven that code alone cannot fully control all kinds of potential on-chain risks. To ensure the smooth implementation of on-chain lending, a group of professionals specializing in complex risk assessment and overall coordination have emerged, namely risk operators, who have officially taken on the role of asset managers within the on-chain ecosystem.
II. Early DeFi lacked specialized risk control roles
Early decentralized lending protocols like Aave and Compound deeply integrated their underlying lending infrastructure with risk control standards into a unified architecture. While some risk managers existed at the time, all assets were pooled into a single fund pool, meaning these managers could only act as overall risk control administrators, fine-tuning overall risk parameters. Once highly volatile assets flooded into the fund pool, this single-pool structure easily triggered risk contagion; losses from a single low-quality asset could quickly spread throughout the entire ecosystem. The industry urgently needed dedicated personnel to manage this chain of risks.
The emergence of Morpho completely reshaped the industry landscape. This project separated collateralized asset classes and lending terms into independent trading markets, replacing the traditional single-pool funding model with a multi-vault modular architecture. This fundamentally restructured asset operation, and the role of risk operators was also completely transformed. Practitioners were no longer limited to passive risk control within a fixed protocol framework; external professional teams could independently formulate risk control rules and build and operate their own dedicated lending vaults. With the complete separation of underlying infrastructure and risk assessment authority, risk operators formally transformed from protocol-wide risk control managers into professional asset operators in the crypto market, independently managing multiple funding vault operations.
III. Current Status of Industry Leaders
As of May 2026, the global venture capital trading sector managed approximately $7 billion in assets, with the top three teams holding 70% of the market share. This sector only truly entered its boom period in 2025, and now capital is rapidly flowing towards strong teams, with investors highly favoring operating entities with proven track records.
The three leading teams entered the market through different paths:
Steakhouse: A robust risk management firm that pioneered the compliant on-chain collateralization of high-quality real-world assets such as US Treasury bonds. As Coinbase's dedicated backend risk control partner for lending, it boasts top-tier traffic channels and managed assets of $1.53 billion as of February 2026, ranking first in the industry. It also spearheaded the definition of compliant real-world asset criteria for inclusion as collateral in the DeFi ecosystem.
Sentora: Built on an AI-powered risk control model and institutional-grade data system, it is deeply integrated with Kraken exchange as a backend service provider, securing a stable channel for institutional funds. With assets under management of $1.34 billion, it ranks second, focusing on connecting the fund transfer links between exchanges and institutional clients.
Gauntlet: A long-established on-chain quantitative risk control modeling institution, specializing in simulating various market risk control parameters. In October 2025, it handled a massive influx of $775 million, completing the abnormal annualized return correction in just 10 days. Its exceptional large-scale fund risk control and crisis management capabilities are widely recognized in the industry. Currently, it manages $1.29 billion in assets and is recognized as a benchmark for large-scale fund inflow risk control and stabilization in the industry.
At present, the competition in the industry has long since moved beyond simply comparing asset size. The core focus of the competition has shifted to three key barriers: collateral access standards, fund distribution channels, and emergency response capabilities for sudden risks.
IV. Traditional Asset Management Models vs. DeFi Risk Management Systems
With Morpho completing its market modularization, each type of collateralized asset requires a dedicated professional team to independently assess and manage it. Professional risk control teams such as Steakhouse have entered the market to become dedicated risk managers for DeFi, and the decentralized finance operation model is gradually aligning with traditional mature asset management processes.
As can be clearly seen from top to bottom, the current DeFi underlying architecture has completely replicated the traditional financial process's division of labor:
Top-level fundraising and distribution: Institutional investors are the core source of funds, and massive amounts of funds flow into the on-chain ecosystem through mainstream centralized exchanges and comprehensive service platforms, corresponding to the functions of traditional financial securities firms and fund distribution channels.
Mid-level strategy formulation and risk management: DeFi risk operators coordinate and plan the capital operation model, benchmarking against traditional asset management portfolio fund managers and risk control committees, to set asset entry thresholds, holding limits, and build an overall capital operation strategy.
Underlying product development and asset custody: Relying on the fund treasury carrier, the operation strategy is transformed into on-chain financial products that can be invested externally; the lowest-level lending protocol is responsible for asset storage and on-chain settlement execution, undertaking the functions of traditional financial asset custody and transaction clearing infrastructure.
From fundraising and strategic operations to asset custody and liquidation, the entire operational process is fully aligned with mature traditional financial systems. For traditional financial institutions, on-chain lending is no longer an unfamiliar emerging field, but a standardized market with clear logic and a well-established system, significantly lowering the barriers to entry for institutions.
V. Benchmarking against Traditional Asset Management: Distribution of Opportunities in the Industry
After completing the separation of traditional asset management functions, on-chain lending has officially opened its doors to various institutions, but the barriers to entry vary significantly across different levels of the industry:
Channel distribution layer: Directly facing the end-user market, leading encryption institutions have already achieved market monopoly, and direct competition with traditional financial institutions is extremely costly.
Strategy Management: The core competition lies in financial expertise and a pool of professional talent. Asset risk assessment, management, and product packaging are all core businesses of traditional asset management. Without needing to develop complex underlying technology systems, relying on mature modular infrastructure to implement a proprietary risk control system allows for the rapid establishment of a stable and profitable business model, making it the optimal entry point.
Asset custody and underlying infrastructure layer: This layer focuses on the research and development and implementation of blockchain technology. It is a technology-intensive field with extremely high requirements for the development capabilities of underlying public chains. It is extremely difficult for traditional financial institutions to enter the field by building their own systems.
Compared to other sectors that rely on traffic resources and underlying technology, the strategy management risk control layer has the lowest entry barrier. Traditional financial institutions can quickly seize the dominant position in the industry simply by relying on their mature risk control system accumulated over many years.
Currently, there are three main models for institutions entering the DeFi market. Regardless of the path chosen, the core competitiveness of the sector always lies in the professional risk control and judgment capabilities of the risk management team.
5.1 Channel Distribution Model: Leveraging a Professional Team for Backend Development
Leveraging established external risk management teams as backend services, these platforms rapidly capture market share. This model is suitable for exchanges and fintech platforms with massive user traffic but lacking independent on-chain risk control capabilities. Investment strategies are fully outsourced under this model, but the platform bears the brand reputation and business responsibility risks associated with the partner team. Centralized exchanges, possessing significant user traffic but unwilling to independently develop complex on-chain lending risk control operations, commonly adopt this model: partnering with authoritative and compliant external risk control teams as backend services to launch lending financial services. The platform is responsible for attracting large amounts of capital using its own traffic, while collateral verification and full-process risk management are entirely handled by the partner risk control team.
5.2 Asset Supply Model: Compliant On-Chain Transfer of High-Quality Offline Assets
Asset management institutions holding real-world assets and high-quality underlying credit assets are directly transferring their existing assets to the on-chain market. Taking Apollo as an example, while completing the on-chain supply of assets, institutions are also deploying governance tokens for lending protocols and deeply participating in the formulation of industry collateral access rules adapted to their own assets. The core challenge of this model lies in completing the standardization and compliance of assets and building a comprehensive supporting regulatory adaptation system. Large private equity institutions and offline physical asset holders can directly connect their own high-quality existing assets to on-chain financial channels. Apollo goes beyond simply supplying assets, increasing its holdings of governance tokens for leading lending protocols, and deeply participating in the formulation of industry rules, promoting its own offline assets to become officially compliant collateral assets with higher recognition and stronger risk control priority in the on-chain market. However, asset suppliers cannot arbitrarily include any assets in the collateral category. The market needs professional third parties to objectively verify the authenticity and security of assets and confirm that assets can be quickly and fully realized in on-chain liquidation scenarios. This step cannot be separated from the rigorous qualification review and credit endorsement of the risk management team. Ultimately, the long-term implementation of the asset supply model still relies on the professional risk control and verification capabilities of the asset management institutions themselves.
5.3 Self-operated model: Building an in-house team to act as the risk control operator (Representative institution: Bitwise)
Asset management institutions independently develop investment strategies and build and operate their own on-chain fund vaults. Bitwise is the first to define its on-chain fund vault as a 2.0 version of an exchange-traded fund, officially entering the market deeply. This model grants the institution the highest autonomy in fee pricing and collateral eligibility standards, but all risks and losses incurred in business operations are borne entirely by the institution. This model is suitable for large asset management institutions that have established their own professional risk control teams. Traditional asset management institutions that break away from external platforms and directly transform into independent risk operators fall into this category. Bitwise leverages its mature asset portfolio to build a system and risk control system, independently designing and fully managing the on-chain vault operation model, directly obtaining stable management returns on-chain.
VI. Industry Landscape on the Eve of Massive Influx of Traditional Capital
From an industry development perspective, as the on-chain lending ecosystem continues to improve and mature, traditional large asset management institutions possess the strongest advantage in entering the market. After the DeFi ecosystem completed its modular functional decomposition, the core market demand has shifted: the industry no longer lacks smart contract development talent, but rather desperately needs the professional financial capabilities accumulated by traditional financial institutions over many years, such as collateral due diligence and risk limit setting. The practical risk control experience accumulated by traditional asset management institutions over decades can be seamlessly adapted and migrated to on-chain financial scenarios.
However, the current overall size of the DeFi market is not yet able to accommodate the large-scale entry of the world's top asset management institutions: the total size of the global traditional asset management industry is as high as 147 trillion US dollars, and BlackRock alone manages 14 trillion US dollars in assets; in contrast, the entire crypto DeFi sector is only 80 billion US dollars, of which the risk management sub-sector is only 7 billion US dollars, less than one two-thousandth of BlackRock's assets under management.
The stark difference in size precisely demonstrates the enormous growth potential of this sector. Institutional funds have always prioritized risk control, only investing in mature markets with robust risk management systems. Once risk management teams establish a secure and stable on-chain fund transfer system, and the supporting industry regulatory framework is in place, the industry will undergo a qualitative transformation. Even a small diversion of funds from the 147 trillion yuan traditional asset management market will rapidly drive explosive growth in the 80 billion yuan DeFi market.
Many industry advantages exist only in the early stages of a sector's development. Currently, there are only a handful of top-tier risk management teams globally. Large-scale institutional entry necessitates the establishment of mature industry operating rules. Teams that first establish the underlying operating system will firmly grasp the dominant power in rule-making. While later entrants may enjoy a more完善的 and standardized market environment, they can only compete by adhering to established industry rules, missing out on the core influence and first-mover advantage of early investment.
