For DeFi to truly support a trillion-dollar scale, the money from crypto world players alone is far from enough—it's the massive capital from TradFi that is the key variable. But here's the problem: the regulatory gray area and compliance costs are like a wall, keeping most institutional funds outside the door. One project chose neither to confront head-on nor to feign ignorance, but is doing something quite interesting: building a "compliance transfer station" to try to connect the on-chain world with traditional capital.

Their gameplay is divided into several levels. On the technical level, they have created a "Compliance Vault" module—funds must pass identity verification before entering, and addresses that do not pass KYC/AML checks cannot access at all. Moreover, these vaults can only invest in relatively safe targets: either registered security tokens or fully collateralized lending protocols, with each transaction able to pull out audit records that comply with accounting standards.

On the entity level, it's even harsher: the team behind it may have directly established a licensed legal entity specifically to serve institutional clients. Institutional funds are first placed in regulated custody accounts and then connected to on-chain protocols through a "whitelist mechanism"—which allows them to benefit from on-chain yields while not violating offline compliance requirements.

There is also a loophole in governance: a "Institutional Advisory Committee" may be set up in the DAO to allow those from traditional finance to have a voice. This design is essentially finding a balance between the ideal of decentralization and real-world regulation—after all, if you really want to grow, you have to negotiate with the existing rule system.