The Bank for International Settlements (BIS) released a report highlighting that cryptocurrencies and decentralized finance (DeFi) have reached a "critical mass," posing potential risks to the traditional financial system and potentially exacerbating wealth inequality. The BIS report outlines key research areas as DeFi evolves, emphasizing challenges to global financial stability and calling for measures such as Know Your Customer (KYC) compliance. The report has faced criticism from industry figures, including Christopher Perkins, president of CoinFund, who described the BIS's containment strategy as "dangerous." Meanwhile, traditional financial institutions are increasingly engaging with crypto and DeFi technologies. Federal Reserve Chair Jerome Powell noted that digital assets are moving into mainstream adoption. Major financial firms like Visa have joined revenue-sharing stablecoin networks, and JPMorgan has launched tokenized British pound sterling (GBP) payment rails. Additionally, several cryptocurrency companies, including Coinbase Global and Paxos, are considering applying for banking charters or licenses to strengthen their ties with the U.S. banking system. A consortium of banks, including Deutsche Bank and Standard Chartered, is exploring expanding crypto operations in the United States, signaling growing institutional interest in the sector.