Let’s start with the obvious question. Why DeFi Core?
With the development and gaining popularity of decentralized financial applications, this was a logical move. When we were looking at the market back in 2017, we saw a clear trend, Bitcoin was losing its dominance and the timing was right for a product like BLX, an index that captures the growth of the industry as a whole.
Now the logic was similar, and we saw growth in decentralized finance, protocols, and applications developed on top of it. By developing a DeFi Core Crypto Strategy, we want to be a part of this growth, and also to utilize the rewards of network participation.
Furthermore, DeFi Core is a one-click gateway to DeFi exposure and network participation.
What is the structure behind the DeFi Core Crypto Strategy?
Since Ethereum powers the DeFi ecosystem, it represents the biggest weight – which is currently set at 50%. A total of 12.5% is kept in USDC and DAI, which are USD pegged stablecoins that we lend through the Power Mango service in return for up to an 8% yearly interest rate. Five percent of our assets are kept in each of the leading, and some of the most promising Defi projects; Maker, Kyber Network, Kava, Ren Protocol, and 0x.
So are you saying, even though part of the assets are in stable coin, those assets still bring value?
Yes, we lend part of the assets in return for up to 8% yearly interest, meaning that the assets are protecting the structure in case of a bear market, while still bringing value to the overall structure.
To whom would you recommend this strategy?
To anyone who has lost faith in the traditional banking system and wants to be part of something new, something disruptive. In other words, for people who want to be part of the DeFi movement and its early adoption.
How do you see the Decentralized Finance movement? In your opinion, what can it bring to the table?
Decentralized Finance can bring back trust to the financial systems. Let’s not forget that the bitcoin and crypto movement, in general, were born because people lost faith in the traditional financial system. Now, its applications have come so far that DeFi can in some aspects (lending, borrowing, exchange of assets) already compete with the traditional banking system. If things will continue in this way, people will soon have an opportunity to trust computers and protocols instead of their bank.
Which solutions/products were already “born” under the Decentralized Finance movement?
At the moment, the DeFi scope is limited to exchanging crypto-assets, lending and borrowing money, or crypto.
You are an experienced investor yourself. Why would you recommend that others create their own Crypto Strategy?
Creating your own Crypto Strategy enables you to include, in only assets, that you believe in and can adjust the structure or weights at any time. Furthermore, if you have your own Strategy you can earn a little extra by adding a Performance fee and invite others to follow it and monetize your trading skills.
Last but not least, what are the future plans with ICONOMI’s DeFi Core?
In the future, we plan to use more assets in the network participation activities, and will thus generate additional rewards for DeFi Core holders.