With over 100 layer-2 (L2) blockchains, you’re excused for thinking Ethereum is too expensive and too slow. But ask any institution preparing to settle a $500 million interest rate swap where they’ll build, and the answer is Ethereum. The reason reveals everything about how institutional DeFi is likely to develop.
The metrics that matter for institutional adoption are entirely different to retail. While retail users flee Ethereum’s transaction fees for cheaper chains, institutions will gladly pay that premium for security when moving hundreds of millions. The premium that people are willing to pay for a safe infrastructure is not an issue. Ethereum’s “weaknesses” are actually its institutional moat.
A tale of two markets
Examining the numbers, the difference in perspective between retail and institutional investors makes sense. If you are buying a memecoin for $50, you don’t want to pay $10 in transaction fees. But when it comes to settling a $500 million interest rate swap, sh
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