TradFi Framework

Definition ∞ The TradFi Framework refers to the established regulatory, operational, and market structures of traditional finance, encompassing conventional banks, exchanges, brokerages, and investment firms. This framework includes well-defined legal precedents, regulatory bodies, compliance requirements, and market practices that have evolved over decades. It serves as a benchmark against which new financial systems, such as decentralized finance, are often compared and evaluated. This structure provides a reference for financial stability and consumer protection.
Context ∞ The discussion around the TradFi Framework is central to the ongoing dialogue about integrating digital assets into the broader financial system and developing appropriate regulations for crypto. Its situation involves regulators and policymakers attempting to adapt existing TradFi rules to address the unique characteristics and risks of cryptocurrencies. A critical debate centers on whether cryptoassets should be shoehorned into the TradFi framework or if a bespoke regulatory approach is necessary. News often covers regulatory proposals that seek to align crypto operations with traditional financial standards.