TradFi

TradFi is an abbreviation of "traditional finance", used mainly by people in the crypto industry to describe the conventional financial system: commercial banks, investment banks, brokers, asset managers, insurers, payment networks, stock and bond markets, and the central banks and regulators that oversee them. The term became popular as a counterpart to DeFi, or decentralized finance, which aims to offer financial services through public blockchains and smart contracts rather than through intermediaries. TradFi is generally characterized by licensed institutions, customer identity checks, legal protections such as deposit insurance, set business hours for many markets and settlement that can take days. The line between the two is increasingly blurred, as large financial institutions launch crypto products, issue tokenized securities and hold stablecoin reserves. A related term, CeFi, describes centralized crypto firms such as exchanges. Also see legacy payment systems.