I think that two things you mentioned are equally possible:
- anti-gravity by the end of XXI century
- wide public listening to warning from experts
We live in times when there is way too much opinions out there and it’s hard or impossible to gauge who are real authorities with your best interest at heart and follows his own agenda.
Still I think that mechanics of Defi protocols should be iterated upon to provide better investor protections and make it more like regulated markets and less like “dog eats dog” kind of situation.
If you think about it, a lot of services provided by the state regulation are the result of people reacting to stronger players taking advantage of the less capable. This is generally good for markets because it prevents crashes or at least make them milder. I don’t think that without offering better protections, at least for users who expect it, Defi could ever seriously make a dent in old-school financial systems.
Regulations are not bad by themselves. It’s only when you put in a center some organization led by people, the goals change from “protecting the weak” to “consolidate power”.