Onboarding for larger DeFi capital with traditional financial rails
Curious to hear about others' experiences attempting to onboard significant capital into DeFi protocols using traditional financial rails, specifically around the friction points with various payment service providers (PSPs) or even banks themselves. My team's finding that while smaller transfers are straightforward enough, moving seven-figure sums often triggers disproportionate KYC/KYB hurdles, extended holding periods, and in some cases, outright rejections, even when dealing with regulated entities. The spreads on some of these 'institutional' crypto on-ramps are also surprisingly high given the volume. Is anyone consistently achieving smooth, cost-effective transfers for larger sums, perhaps through a specific type of intermediary, or is this still a fundamental bottleneck for scaling institutional DeFi participation?
This is a significant hurdle that many institutions face. We've found that pre-establishing relationships and providing full transparency on the source and intended use of funds well in advance can somewhat mitigate the KYC/KYB delays, but it's far from a seamless process for larger transfers.