TradFi is short for “traditional finance.” It refers to the conventional financial system—institutions and structures that existed before the rise of crypto and decentralized finance (DeFi).
That includes things like:
Banks (retail and investment)
Stock exchanges
Asset managers and hedge funds
Central banks
Insurance companies
In contrast to DeFi, TradFi is typically:
Centralized (controlled by institutions)
Regulated by governments
Intermediary-based (you need banks, brokers, etc. to transact)
People often use “TradFi” when comparing it to crypto/DeFi, especially in discussions about:
Regulation vs decentralization
Trust in institutions vs trustless systems
Speed and cost of transactions