Fed Governor Waller says ‘there is nothing scary’ in payments using DeFi rails

Federal Reserve Governor Christopher Waller declared that “there is nothing scary” about DeFi simply because it operates outside traditional banking infrastructure.

Speaking at Wyoming Blockchain Symposium 2025, Waller framed blockchain-based transactions as a natural technological evolution rather than disruptive threats.

He compared DeFi operations to conventional purchases, noting that buying crypto with stablecoins through smart contracts follows the same fundamental process as using debit cards at grocery stores.

Waller noted:

“There is nothing to be afraid of when thinking about using smart contracts, tokenization, or distributed ledgers in everyday transactions.”

The Fed Governor positioned DeFi technologies as new tools for transferring assets and recording transactions, citing their functional similarity to established payment methods.

Waller advocated for private sector-led innovation as the primary driver of payment system advancement, calling stablecoins the latest example of market-driven solutions.

In addition, he credited stablecoin development with extending dollar accessibility globally, particularly in high-inflation countries lacking affordable banking services.

Waller even highlighted stablecoins’ potential to “maintain and extend the role of the dollar internationally” while improving retail and cross-border payments through 24/7 availability and fast transferability.

The speech follows the passage of the GENIUS Act, the first primary crypto legislation signed into law, which Waller called “an important step for the payment stablecoin market.”

Reinforcing DeFi-friendly stance

Waller’s Wyoming comments build on previous pro-innovation positions expressed throughout 2024. 

Speaking at the Vienna Macroeconomics Workshop in October, the Fed Governor argued that DeFi would more likely complement traditional finance rather than replace it entirely.

He acknowledged DeFi’s potential to streamline financial activities while maintaining that intermediaries serve valuable functions for most individuals.

At The Clearing House Annual Conference in November 2024, Waller advocated for market-driven solutions in crypto and payments, emphasizing private sector benefits in fostering innovation through competition. 

He argued that profit motivation and competition enable private firms to make superior decisions about technology investments and consumer needs assessment.

Waller emphasized that the Fed conducts technical research on tokenization, smart contracts, and artificial intelligence in payments. The effort supports the Fed’s role as a payment system operator while enabling private sector firms to leverage the central bank infrastructure.

Waller described the payment system as experiencing a “technology-driven revolution” powered by advances in computing power, data processing, and distributed networks.