Andre Cronje: DeFi is now on-chain finance

During a Chain Reaction X Spaces panel, Andre Cronje argued that decentralized finance as originally conceived no longer exists and that the sector has shifted to what he calls “on-chain finance.” He argued most current protocols are effectively centralized, with operational control held by companies, governance groups and built-in emergency controls.

Cronje defined “true DeFi” as systems that are decentralized, immutable and operate without an intermediary. He added that this definition does not fit the majority of existing protocols and pointed to recent adoption of circuit breakers and pause functions intended to limit losses after exploits. Cronje declared, “I don’t think DeFi exists anymore outside of those very small niches.” He explained, “Because your intermediary now is a company, it’s a decision maker, it’s a curator, it’s a risk committee.”

Data from DefiLlama shows total value locked in DeFi fell to about $75 billion from roughly $167 billion in early October 2025, a decline of more than half over roughly ten months. Market stress, security incidents and product designs that introduce centralized controls have been cited in industry discussion as contributors to the decline.

A March working paper from the European Central Bank examined governance in Aave, MakerDAO, Ampleforth and Uniswap. The ECB found the top 100 holders of each protocol’s governance token controlled more than 80% of the supply in snapshots taken in November 2022 and May 2023, and noted those concentration levels raise questions about whether some DAOs meet the criteria for being treated as “fully decentralized” under regulatory frameworks.

Cronje is founder of Flying Tulip and creator of Fantom Network. He previously founded Yearn.finance and the Keep3r Network and has worked on Sonic, a blockchain his team reported reached 720-millisecond finality in a testnet environment.

Developers and other industry participants are debating trade-offs between using human-operated controls to reduce risk and preserving decentralized, trustless governance. Some developers argue timelocks, multisignature emergency keys and other control mechanisms are needed to protect users; others argue those mechanisms concentrate decision-making.

Observers and market participants are monitoring whether protocol designs move back to wider decentralization or continue to rely on layered operational controls. For now, falling TVL, concentrated token holdings and high-profile security incidents are part of the evidence shaping that discussion.