During a recent fireside chat, Ronghui Gu, Founder of CertiK, joined Billy Sebell of XDC Foundation to discuss how blockchain technology, tokenization, and AI are transforming trade finance, and why cybersecurity remains one of the industry’s most critical challenges. The conversation explored the realities of institutional adoption, evolving security threats, and what it will take to build truly scalable financial infrastructure on-chain. Below are some of the key takeaways.
Why Trade Finance Needs Modernization
For XDC, trade finance has been a core focus since the network’s earliest days. Billy explained that the company’s founders initially worked with banks on risk mitigation before recognizing a much larger opportunity: addressing the growing financing gap facing small and medium-sized enterprises worldwide.
Trade finance today still relies heavily on paper-based processes, fragmented systems, and manual verification. According to Billy, a single shipment transaction can involve dozens of documents moving between multiple parties, creating inefficiencies, delays, and opportunities for fraud. Blockchain infrastructure offers a potential solution by creating transparent, verifiable records that can streamline these workflows and reduce duplication across the financing process.
The Institutional Trust Problem
While blockchain technology promises faster settlement and improved efficiency, institutions remain cautious about moving sensitive financial operations on-chain.
According to Professor Gu, cybersecurity concerns are a major reason why adoption has progressed more slowly than many anticipated. “Cybersecurity is indeed a reason that scares away many of the institutions or makes them hesitate to embrace this technology right now,” Professor Gu said.
He then pointed to the sheer frequency of attacks across the industry as a major concern. He noted that in April, there were only three days without a publicly reported hack event in crypto. But security challenges extend beyond smart contract exploits alone. Professor Gu emphasized that institutions also face concerns around compliance, operational risk, off-chain vulnerabilities, and broader infrastructure maturity. “It is still at an early stage, but there’s a lot of challenges ahead of us that we need to address to empower the full adoption from institutions,” he said.
Tokenization Beyond the Hype
The discussion also examined how tokenization is evolving into a tool for improving real-world financial infrastructure. Billy described how tokenization can help modernize areas like invoice financing, debt restructuring, and working capital markets by increasing transparency and reducing friction between counterparties. One major advantage, he explained, is fraud prevention. “When you’re on a network and you have a platform that can do that, you can see that there’s one person that has actually lent money towards that invoice,” Billy said. “You’re going to actually save a lot in the way of fraud.”
Rather than simply placing assets on-chain, Billy argued that the larger goal is creating systems that provide tangible operational value to businesses and financial markets. Professor Gu added that tokenized assets will require stronger verification systems as adoption grows, particularly around Proof of Reserve and validation of underlying real-world assets.
“We may need real-time Proof of Reserve,” Professor Gu explained. “We need to have new solutions.” He also stressed the importance of collaboration between blockchain companies, auditors, and regulators to establish clearer protections for users and institutions.
AI Is Changing the Security Landscape
AI became another major theme throughout the conversation, particularly as blockchain companies increasingly explore AI-powered agents and automation tools to simplify user experiences.
Billy noted that institutions ultimately want blockchain interactions to feel as seamless as existing payment systems like Apple Pay, where users can transact without navigating multiple wallets or technical workflows.
Professor Gu acknowledged that AI has the potential to improve efficiency, but warned that it is simultaneously creating new cybersecurity risks. “The hacker’s life can be easier, but for sure as a security firm, our job becomes more and more challenging,” he said.
According to Professor Gu, AI models are already capable of identifying many vulnerabilities at the level of a junior security researcher. While that creates opportunities for defensive tooling, it also lowers the barrier for attackers attempting to target protocols, applications, and exchanges at scale.
At the same time, as companies move toward more seamless Web2-style interfaces, the attack surface expands beyond smart contracts into applications, operations, and user-facing infrastructure. “In the past few years, we have worked closely with partners to make the smart contracts themselves more and more secure,” Professor Gu said.
To address these evolving threats, CertiK has been developing AI-powered auditing solutions designed to integrate security earlier into the development lifecycle rather than relying solely on large, one-time audits before deployment.
Building Institutional-Grade Blockchain Infrastructure
The conversation concluded with a broader reflection on the collaboration between CertiK and XDC and the role partnerships play in advancing institutional blockchain adoption. For Billy, long-term collaboration has been essential for securing the network itself and supporting the growing ecosystem of projects building on top of it.
Professor Gu noted that working with institutional-focused tokenization platforms like XDC has also helped CertiK refine its own approach to institutional-grade cybersecurity. “It’s a great pleasure for us to be working with XDC,” he said. “We learned a lot from this procedure as well.”
As tokenization, AI, and institutional blockchain adoption continue evolving simultaneously, the discussion made one thing clear: the next phase of Web3 growth will depend on whether the industry can build infrastructure that institutions trust at scale.
