Banks outperform DeFi by 10 times in absolute profit, but fall short in a key metric

【Plain Language Summary】This article explores whether the return on $1 bank deposits is 10 times that of Aave USDC.

Banks dominate in absolute profit scale, such as RBC's net profit of $14.7 billion, while Aave's annual revenue is only $105 million. However, in terms of efficiency per unit, DeFi achieves a hundredfold surpass, generating tens of millions of dollars per person with nearly zero operating costs. Aave's lending mainly involves crypto leverage arbitrage, not real-world financing.

The bank's advantage comes from low financing costs, high risk premiums, and regulatory barriers, yet they are increasingly adopting DeFi technology. In the future, hybrid institutions will combine efficiency and security to lead financial competition.

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