A coalition of decentralized finance (DeFi) proponents has put forward a proposal arguing that its technology could redirect an estimated $30 billion annually from the profits of financial institutions to low-income households worldwide. The initiative, led by the DeFi Education Fund (DEF) and other crypto policy groups, targets what researchers call the “poverty premium”—the disproportionately high fees the financially vulnerable pay for basic services.

The High Cost of Financial Exclusion

The push comes as global poverty remains a persistent challenge. According to updated global estimates for 2025, approximately 808 million people live in extreme poverty on less than $3 per day, while another 887 million face multidimensional poverty. For many of these households, the traditional financial system adds another layer of economic pressure.

Research from DEF highlights a significant cost gap between rich and poor households in the United States. With roughly 5.6 million U.S. households unbanked and another 14.2% underbanked, many are forced to use costly alternatives. Cashing a paycheck can cost up to 5% of its value, and financial fees consume an average of 7.1% of annual income for low-income families—a stark contrast to the 0.2% paid by wealthier households.

A Decentralized Solution

Advocates argue that by removing intermediaries, DeFi’s financial infrastructure could dramatically lower the cost of essential services like remittances, money transfers, and bill payments. One key estimate in the proposal suggests that DeFi could cut global remittance costs by as much as 80%, potentially saving the world’s unbanked populations $30 billion each year.

Public sentiment appears to be shifting toward alternatives. A DEF survey conducted with Ipsos revealed that 42% of Americans would likely try DeFi services if new legislation clarified crypto privacy protections. Many respondents cited frustrations with banking delays, unexpected fees, and a lack of control over their own funds, with 56% stating they want full control of their money.

Advocacy and Regulatory Hurdles in Washington

Alongside its economic arguments, the DeFi Education Fund has increased its policy efforts. In August, the organization launched the DeFi Education Foundation, a nonprofit aimed at expanding its advocacy and engagement with lawmakers. Around the same time, DEF and Andreessen Horowitz (a16z) urged the U.S. Securities and Exchange Commission to establish a regulatory “safe harbor” for blockchain applications, arguing that neutral software interfaces shouldn’t be classified as financial brokers.

DEF also submitted a formal response to the Senate Banking Committee’s draft Responsible Financial Innovation Act of 2025. In the filing, DEF joined other major crypto firms—including Paradigm, Jump Crypto, and the Uniswap Foundation—to call for a clear regulatory distinction between software developers and financial intermediaries.

Real-World Use Cases and Current Limitations

Proponents point to existing examples of digital tools expanding financial access. In Nigeria and parts of East Africa, crypto-based networks enable transactions for users with or without smartphones. In nations facing hyperinflation and conflict, such as Venezuela, Zimbabwe, and Argentina, digital currencies have become a tool for moving money and preserving savings. Some humanitarian organizations have even adopted blockchain systems to distribute aid with greater transparency.

However, DeFi still faces significant limitations. Collateral-heavy lending models, volatile token markets, smart-contract vulnerabilities, and barriers to financial literacy have slowed broader adoption. Much of the current activity remains concentrated in speculative trading rather than real-world economic use. Even in El Salvador, where Bitcoin became legal tender in 2021, daily usage has remained below expectations. Despite these challenges, DEF maintains that policymakers should protect the core aspects of DeFi that directly reduce costs and empower consumers living on the financial margins.