Fed Governor Waller Declares: ’Nothing Scary’ About Payments on DeFi Rails
Federal Reserve Governor Christopher Waller just dropped a bombshell endorsement of decentralized finance infrastructure—and traditional banks should be sweating.
Waller's remarks signal a seismic shift in regulatory posture toward crypto-native payment systems. The Fed official explicitly dismissed concerns about DeFi payment rails, calling fears unwarranted and highlighting the efficiency gains over legacy systems.
DeFi doesn't just streamline settlements—it completely bypasses the correspondent banking mess that adds days and percentage points to every cross-border transaction. No more waiting for business hours. No more intermediary fees eating into margins.
While Wall Street still charges $30 billion annually for international transfers that take three days, DeFi protocols move value globally in minutes for pennies. The math isn't complicated—it's just inconvenient for institutions clinging to outdated revenue models.
Waller's stance essentially greenlights experimentation with decentralized payment infrastructure at a time when traditional finance struggles with its own innovation debt. The irony? The most progressive payment tech endorsement of the year came from a central banker—not some Silicon Valley disruptor.
Maybe the real horror story isn't DeFi—it's watching legacy finance try to innovate at government speed while charging hedge fund fees.
Reinforcing DeFi-friendly stance
Waller’s Wyoming comments build on previous pro-innovation positions expressed throughout 2024.
Speaking at the Vienna Macroeconomics Workshop in October, the Fed Governor argued that DeFi wouldrather than replace it entirely.
He acknowledged DeFi’s potential to streamline financial activities while maintaining that intermediaries serve valuable functions for most individuals.
At The Clearing House Annual Conference in November 2024, Wallerin crypto and payments, emphasizing private sector benefits in fostering innovation through competition.
He argued that profit motivation and competition enable private firms to make superior decisions about technology investments and consumer needs assessment.
Waller emphasized that the Fed conducts technical research on tokenization, smart contracts, and artificial intelligence in payments. The effort supports the Fed’s role as a payment system operator while enabling private sector firms to leverage the central bank infrastructure.
Waller described the payment system as experiencing a “technology-driven revolution” powered by advances in computing power, data processing, and distributed networks.
