Emerging Funds — Is DeFi the Future?

Decentralised Finance (DeFi) was the story of 2021, with over $100B in total locked value. It’s about a new set of rails, decentralised finance, that challenge the conventions of financial markets today offering an ability to create financial products in a way that is markedly different from Trade Finance (TradFi).

The low US$ interest rate environment has driven investors to search for alternative yield opportunities, and with the explosion in demand on DeFi protocols leading to higher interest rates, attractive risk-adjusted opportunities can be found in this technologically sophisticated market. The barrier to entry, however, has been high. There are many regulatory, operational and security issues to solve before delivering a DeFi-based investment solution. Read what one DeFi Fund, Fund Manager, Fund Administrator and Custodian had to say in this expert Q&A interview.

Here’s what’s covered:

1. Will DeFi and traditional finance processes compete?
2. What are the complexities, strengths and weaknesses identified and what considerations should be prioritised first in the journey to setting up a fund?
3. As digital assets are borderless, what are the regulatory implications that have to be addressed?
4. What is the right operational model/infrastructure to consider?
5. How do you address trust and security in institutional DeFi?
6. DeFi and Web 3.0, rise of the creator economy
7. What kind of solutions are needed most in coming years for DeFi to continue growing?

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