Decentralized finance aims to make banking available to everyone, yet its complicated nature leads to an important question: Can everyday people really use it, or is it only meant for those with special resources? For wealthy individuals, the answer shows not only what DeFi lacks but also the difference between its potential and reality.

The Hidden Barriers to Entry

The allure of DeFi being "middleman-free" conceals several real obstacles. Users need to handle wallets, gas fees, and smart contract terms, in addition to merely purchasing crypto—activities that require a solid grasp of technology and can be time-consuming. To invest $10,000 in a yield farming venture, one must understand concepts like impermanent loss, liquidity pools, and blockchain congestion, which could wipe out profits in an instant. For the average person, these complications make the idea of “financial freedom” seem more like a risky gamble. In contrast, wealthy individuals can hire specialists to navigate these intricacies, transforming DeFi from a do-it-yourself adventure into a tailored experience. This gap between those who can seek help and those who cannot renders DeFi less inclusive than it claims to be.

Risk vs. Reward: A Scalable Calculus

DeFi offers impressive yields, often ranging from 10% to 30% APY, but these come with significant risks such as smart contract hacks, regulatory actions, and project failures. For average individuals with limited funds, even one error can lead to severe losses. In contrast, wealthy investors typically allocate only a small percentage—about 5% to 10%—of their diversified portfolios to high-risk, high-reward strategies. They can withstand a failed project because their other investments, like stocks and real estate, cushion the impact. Additionally, they have the advantage of accessing private DeFi pools that undergo more thorough vetting, which helps minimize the risk of scams that are common on public platforms. Thus, for them, engaging in DeFi is a calculated risk, rather than a desperate gamble.

The Illusion of Inclusivity

DeFi promotes itself as a way to help people without access to banks, yet its structure mainly benefits those who have reliable internet, crypto-friendly bank options, and extra money to spend. For instance, a farmer in a developing nation struggles to change yield farming earnings into their local currency and often can’t manage the high gas fees during busy network times. In contrast, wealthy users can easily use cross-chain bridges and high-end wallets to transfer money, turning the difficulties of DeFi into small annoyances. This situation shows that DeFi serves more as a luxury for the financially advantaged rather than a tool for equality, widening the gap between the rich and poor instead of closing it.

While DeFi isn't inherently wrong for everyday individuals, its current design requires resources that many do not possess, such as time, tech know-how, and financial safety nets. For those with wealth, it offers a valuable addition to their financial options, presenting choices beyond standard banking. However, for many, it remains an unfulfilled promise—one that will only achieve its goal of democratization when it becomes simpler to use. Until that happens, DeFi’s claim of being “for everyone” feels insincere.