Many people are obsessed with the scale of DeFi but fail to notice where the real whales are. The size of the interbank repo market is in the trillions, while the current TVL in DeFi is just a drop in the ocean.

But there's a critical problem here. Large banks need to borrow overnight funds daily by collateralizing bonds, but once they publicly pledge assets on-chain, the entire market can immediately read it—"This bank is short on cash." The stock price would plummet instantly. Everyone has heard the story of Lehman Brothers.

So even with cutting-edge Web3 technology, traditional institutions still have an insurmountable psychological barrier. How to break through?

Dusk's approach is quite clever. It uses zero-knowledge proofs to build a "hidden collateral" system. Government bonds and high-grade assets are tokenized and used as collateral, but the ZK circuit only tells the funding party one thing—"This collateral is sufficient and compliant." Who is borrowing, and which specific securities are being pledged, are all handled as black boxes.

This way, trust is established, and liquidity dilemmas are completely concealed. Large institutions can finance each other without revealing their positions. Once this model is fully operational, a trillion-dollar liquidity pool on-chain is no longer a dream.