The practical challenges faced by DeFi fund management seem to be more serious than initially thought.

Recently, I was researching how high-liquidity crypto asset funds are managed, and I was surprised to find that many fund managers still rely on spreadsheets and manual reconciliation. Despite the increasing legitimacy of DeFi and growing interest from institutional investors, they continue to use outdated methods to track positions across multiple exchanges and protocols.

Funds involved in liquidity provision, staking, and yield farming seem to be especially affected. Dynamic positions require advanced tracking and reporting, but the lack of integrated systems that can handle both centralized and decentralized environments is a major issue. Traditional portfolio management tools cannot cope with the complexity of multiple asset exposures and the dynamic fees associated with DeFi positions.

This inefficiency has significant impacts, as fund managers struggle to provide accurate net asset value (NAV) calculations and performance metrics. The accuracy of yield spread calculations declines, and trust from institutional investors is also compromised.

To address these operational challenges, AI-driven solutions are gaining attention. AI can automate the classification and tracking of DeFi positions, providing comprehensive visibility and protocol-level intelligence necessary for effective management of complex portfolios. It also enables real-time monitoring of dynamic yield spread changes.

In short, without these technological advancements, it will become increasingly difficult for crypto asset funds to adapt to the rapidly evolving DeFi environment. Improving infrastructure will be a crucial factor in future fund management efficiency.