DeFi innovation continues as the Dharma wallet introduces a way to transfer bank funds straight to DeFi on one platform.

Developing DeFi

The Dharma wallet announced yesterday that users could now send funds to Aave, Uniswap, Yearn, and Compound from their traditional bank accounts with a daily limit of $25,000.

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Say hello 👋🏻 to a whole new Dharma — the Ethereum wallet that connects to your bank account.

📱 Cheaply deposit up to $25k / week into Aave, Compound, Yearn, and Uniswap directly from your bank account — instantly.

From 🏦 Dollars to 🛸 DeFi in a☝🏼Tap ✨ pic.twitter.com/sdOnrnTSB1

— Dharma (@Dharma_HQ) March 29, 2021

Dharma cited the limited functionality of ETH wallets and crypto exchanges as the inspiration for the new features, saying “the average Ethereum wallet has a toy fiat on-ramp with low limits and super high fees, and doesn’t let you withdraw to your bank.”

The wallet now claims to have more capabilities than any fiat exchange and better fiat support than any other Ethereum wallet.

Users can withdraw funds to their bank at any time of day and at any day of the week, potentially solving a major pain point for users frustrated with limited banking hours.

my first checking account as a young lad had a >10% interest rate

then the banks got together and decided to stop paying me to use my money

revenge:
1. open @Dharma_HQ account
2. connect bank
3. convert USD to USDC
4. put it in a Yearn vault
5. earn 13.7% APY

all takes <5 min

— Shane Reiser (@shanereiser) March 30, 2021

Dharma’s announcement stated that users can also “cheaply buy or sell any asset in Uniswap,” although this is presumably a relative term, as Uniswap fees remain historically high. The wallet’s features are powered by the dharmaOS SDK which can connect any Ethereum protocol action to Dharma.

A New Paradigm Shift

DeFi is notoriously complex and difficult for new users, making adoption an uphill battle over the past few years.

However, with a growing number of teams working on projects to bridge the gap between centralized and decentralized finance to make the latter more accessible, the bull case for DeFi is looking stronger by the day.

The St. Louis Federal Reserve published a report in February 2021 detailing the many risks faced by DeFi such as coding errors, the interdependence of projects, and operational security.

However, the central bank conceded that if DeFi can overcome these problems, finance could be about to undergo a major paradigm shift, with the “potential to create a truly open, transparent, and immutable financial infrastructure.”

Disclosure: The author held Bitcoin at the time of writing.