The future of finance will be without banks, according to a report by Bernstein on Friday. Banks will still exist, but in the background act as “custodians of old wealth”. According to analysts Gautam Chhugani and Manas Agrawal, “new wealth creation and innovation in financial services will migrate to new financial applications on the Ethereum ecosystem”.
Decentralized finance is enjoying a renaissance with “more sustainable, scalable, transparent, and improved token economics,” the report said. Bernstein estimates that by 2028, unbanked DeFi revenues will reach $40 billion, and total assets will grow from about $65 billion today to $1 trillion.
Due to rapid adoption, it predicts assets will reach $5 trillion in the next decade. The next generation of DeFi will be built on a scalable layer 2, transaction costs will be reduced by 95%, and products will generate real income and sustainable benefits, rather than being driven by token incentives.