DeFi yields have collapsed below TradFi rates, forcing investors to face higher smart contract risks for lower returns as regulation and exploits mount. Flagship DeFi rates have fallen below traditional finance (TradFi), with Aave’s 2.61% APY on USDC trailing the 3.14% offered by Interactive Brokers. Investors are absorbing high risks—including a $2.47 billion spike in 2025 exploits—for returns that no longer offer a "risk premium" over "risk-free" government rates. Organic on-chain yield has d…
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