Arak Sutivong, CEO of SCB 10X and the president of Siam Commercial Depository financial institution (SCB), has offered an insight into how one of the largest venture upper-case letter funds in Southeast Asia views the future of decentralized finance (DeFi) when information technology comes to the contentious question of regulation.

SCB 10X is the venture arm of SCB, Thailand'south oldest depository financial institution, and by and large focuses on investing in blockchain-based financial services, such as DeFi and digital avails.

In his opening speech at SCB 10X's second annual global DeFi virtual meridian, REDeFiNE, Sutivong stressed that by at present, DeFi had broken through to the mainstream "past many measures." In terms of growth, he noted that the sector had seen a tenfold increase over the by 6 months, with over $100 billion in full value locked in the DeFi ecosystem this year. Past many other metrics — including users, traded volume on exchanges and adult decentralized applications — the sector, he said, has witnessed "tremendous growth."

With all this development and excitement, still, Sutivong emphasized that several bug continue to loom over the nascent manufacture, observing that "there are some concerning areas such as fraud that we keep hearing in the news. In that location has been a lot of concern from industry stakeholders and regulators." Tackling this over the medium- and long-term poses unique challenges, in his view, given that:

"DeFi, by definition, cannot be fully regulated. Instead, in that location needs to be a framework for how DeFi can be integrated with the rest of the fiscal ecosystem."

Sutivong'due south remarks on sustainability and evolving approaches to regulatory compliance follow a series of interventions by global regulators and organizations, ranging from the proactive to the outright hostile.

Related: Bulls are back, but regulatory fears hamper the DeFi and altcoin recovery

In early June, the World Economical Forum published a policy toolkit for DeFi, proposing ways to balance countervailing needs, such equally fulfilling aspirations for decentralization and privacy, while mitigating illicit activities such as money laundering. More specifically, the toolkit addressed concerns that new regulatory interventions could impose significant costs on DeFi startups, discouraging smaller participants from entering the market.

These concerns have been specially astute for many DeFi developers who are unsure about how the Financial Action Job Strength's recommendations for regulating virtual asset service providers will bear on them.

In early June, Dan M. Berkovitz, commissioner of the United states of america Commodity Futures Trading Commission, stated he believes that DeFi derivatives platforms might contravene the country's Commodity Exchange Deed and thus exist illegal.