Podcast #1 Intro to DeFi
The future of the traditional financial system is in the limelight for the past couple of years. The discussions about the 1% of people owning 99% of the Earth’s resources and wealth come more and more to the surface. In this DeFi podcast, the co-Founder of Woorton, Karim Sabba, was joined by
David Fauchier, co-founder of Cambrial Capital
The discussion revolved around current investment opportunities that exist in the crypto space for professional investors as well as the future of the DeFi system.
Some of the key takeaways include:
- What it means to be a fund-of-funds in the digital asset space
- Having a clear horizontal view of the whole market
- The DeFi world and DeFi products
- Intro to generalized mining
What it means to be a fund-of-funds in the digital asset space
Cambrial Capital is a fund of funds that invests in other crypto investment funds. The company decides on the type of an asset class they want to get some exposure of. Then they select crypto funds with extraordinarily competent founding teams that have prior experience in the strategy they are running. This allows such a fund of funds as Cambrial Capital to diversify their investments across a number of different crypto funds as well as hedge underlying risks.
Having a clear horizontal view of the whole market
Investing in funds rather than a direct purchase of underlying assets gives a very different perspective of the market. Cambrial meets numerous crypto funds weekly and asks their opinions about the direction of the market and existing opportunities. This allows them to see the largest allocators in the crypto space. Cambrial Capital are focused on funds with market neutral strategies that do not take a particular direction in the market. There is no need to buy tokens and go into a regulatory mess to make profit if it is possible to invest directly in businesses like crypto exchanges or on-chain analytics startups.
The DeFi world and DeFi products
DeFi is a concept about providing financial-like products and services with the help of decentralized protocols and smart contracts. The first DeFi application was a Bitcoin which is decentralised money. The process of cohabitation of DeFi and non-DeFi products is under careful scrutiny these days. There are several possible scenarios how the DeFi space will evolve in the future. The first assumption is that the DeFi space will fight back and refuse to be regulated. The second option is about running regulated and decentralised systems in parallel. The last scenario envisions how these two systems will merge. The most important vectors in the DeFi space to be considered are: longevity, liquidity and UX for protocols.
Intro to generalized mining
There are several ways to interact with blockchain protocols that allow to produce profit: proof of work hardware mining, staking-type services and generalized mining. The last one is more of a trader-like interaction with protocols which provides services that are not binary. It is not just mining and non-mining that counts. It is also the quality of transacting and uptime that matters in the process.
The DeFi Podcast is produced and hosted by Woorton, a leading European digital asset market maker.
If you want to submit comments, suggest guests for the show or find out how Woorton can help you enhance the liquidity of your assets, please send an email to contact@woorton.com
