In this episode of The Defiant Podcast, Paul Frambot, Co-Founder of Morpho, details how DeFi is transforming the financial industry by intersecting with fintech, shifting value to network users, and reshaping how lending protocols work. He outlines the evolution from early peer-to-peer lending to today's permissionless, immutable infrastructure, highlighting Morpho's product design, its approach to risk management, and specific use cases in institutional finance and global wallet integration. Discussions cover the role of risk managers, transparency benefits, the emergence of DeFi as backbone infrastructure for fintechs, and how platforms like Coinbase now use Morpho behind the scenes.

Paul reflects on how Morpho enables global liquidity, allows businesses and individuals to create custom lending markets, and how DeFi’s open competition leads to better rates and more efficient markets. The conversation wraps with thoughts on unsecured lending, the path to real-world financial product integration, and Morpho's long-term vision to become the foundational protocol for global financing.

Chapters:

00:00 Fintech disruption, DeFi’s impact on infrastructure

01:21 Founding Morpho: backstory and protocol design

03:04 Pushing for permissionless, immutable protocol infrastructure

04:16 Institutional adoption, wallet integrations, and B2B use cases

07:01 Managing risk and collateral in open protocols

10:32 Shift in institutional engagement and business adoption

15:20 Native on-chain fund issuance, regulations, and international frameworks

17:04 Equity and securities as next steps for on-chain finance

19:03 Real-world example: Coinbase leveraging Morpho for global lending liquidity

20:28 End-to-end DeFi integrations: wallet abstraction and feature parity

22:26 Four core benefits when fintechs use DeFi as backend

24:07 Transparency, self-custody, and proof of reserves in DeFi

25:06 Institutional desire for infrastructure ownership—not just distribution

26:29 Competitive rates: DeFi vs. traditional finance lending

27:51 Barriers for banks: regulation, compliance, privacy, and operational hurdles

30:00 Privacy on-chain: transaction anonymity vs. amount privacy

32:29 How DeFi lending markets evolved: competition and network effects

34:00 Differing visions: Morpho as infrastructure vs. Aave as integrated bank

37:12 Market size: overcollateralized and undercollateralized lending potential

38:04 How DeFi could unlock unsecured credit

41:24 Under-collateralized lending, trust, and on-chain identity primitives

44:28 Morpho’s long-term vision and the future of DeFi/fintech convergence