Institutional appetite for decentralized finance is growing even as the sector recorded $635 million in exploit losses during April alone, pushing total value locked down from $172 billion to $148 billion. Coinbase Ventures purchased Ethena's ENA token on the open market, asset manager Janus Henderson took its own strategic ENA position, and lending protocol Morpho closed a $175 million funding round structured entirely around DeFi primitives. The moves signal that traditional finance players are willing to absorb smart contract security risks in exchange for early positioning in high-growth protocols. The divergence between rising institutional inflows and deteriorating on-chain security metrics raises questions about whether Wall Street is pricing in protocol risk or simply discounting it.
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