> What serious borrower needs to pay 10% to access credit?

People who can make more than 10% trading?

Lending protocols aren't doing anything different than what banks do: allocating inactive capital to those who can make use of that capital and are willing to pay for it.

Interest rates are high because of A: market volatility, professional traders can easily make more than 10%, and B: information asymmetry, large capital pools haven't allocated to these pools.

If you can reliably make more than 10% trading, you can borrow from a bank. Or Goldman Sachs. Or whoever. The current interest rate is practically 0. Anyone who is borrowing at 10% is either (a) not very bright or (b) more likely, doing something risky with their money that reputable moneymakers won't touch... probably involving the blockchain. So yeah, Ponzi.

It is super anomalous financial behavior to seek out the highest cost funding though.

Arbitragers gladly pay 10% of their risk-free income to lenders to execute an arbitrage opportunity.

It's not a ponzi.

Lookup what a ponzi scheme is.