Major financial institutions continue exploring decentralized finance, but ongoing security exploits are making adoption far more difficult. According to recent industry data, bridge hacks alone have already caused hundreds of millions of dollars in losses this year, reinforcing concerns that DeFi infrastructure still carries risks many institutions cannot properly quantify.

The problem is no longer just isolated hacks. Modern DeFi systems have become deeply interconnected, meaning investors can sometimes be exposed to vulnerabilities they never directly interacted with themselves. For traditional institutions used to highly structured risk models, this creates a major challenge. Even attractive yields lose appeal when underlying infrastructure risk remains difficult to measure, insure, or fully understand.