Some of the biggest names in DeFi, including Framework Ventures and Alameda Research, are backing the expansion of decentralized asset management protocol dHEDGE.
The investors and the protocol’s decentralized autonomous organization (DAO) will collectively invest $1.15 million into an initial cohort of 33 fund managers operating on the platform.
dHEDGE is a non-custodial social trading platform that allows users to choose asset managers to pool their funds with. The managers’ past trading performance is available for scrutiny, and uploaded to a distributed ledger to ensure immutability. Managers invest using synthetic assets in the Synthetix ecosystem.
The total comprises 651,000 sUSD from the dHEDGE DAO, and 550,000 sUSD contributed by dHEDGE investors Framework Ventures, DeFiance Capital, Divergence Ventures, Mechanism Capital, Klein Blue Capital, and Alameda Research.
Combined with the funds put forward by the fund managers themselves, dHEDGE expects more than 1.8 million sUSD to be deployed across its pools over the coming days and weeks.
Speaking to Cointelegraph, dHEDGE’s Henrik Andersson stated the team is “very impressed by the roster of managers” overseeing pools on the platform, noting the presence of South East Asia crypto investor NGC Asset Management.
Andersson also noted that the platform hosts managers overseeing investments in traditional, non-crypto-native asset classes, emphasizing his excitement for the platform’s growth in 2021:
“Decentralized asset management is set to become a core primitive in the DeFi space.”
Framework Ventures’ co-founder, Michael Anderson, predicted that the next phase of growth for the DeFi sector is contingent on “bringing in the expertise of financial service professionals and showing them the power” of decentralized finance protocols.
Looking forward, Anderson predicted that DeFi will begin to cut into the market share of “centralized crypto finance” platforms — describing such as the dial-up internet of the virtual currency sector:
“The existing borrow/lend, exchange, and derivatives platforms will start to be replaced with DeFi upstarts. Layer 2 solutions will be looked back as the ‘dial-up to broadband’ moment for our industry.”
dHEDGE DAO’s investment is still pending approval from the stakers of dHEDGE’s native DHT token, with voting on whether to mobilize the funds set to close on Nov. 27. The investment will proceed should the proposal receive more votes in favor than opposed.
If passed, the proposal will see the DAO match the investments made by 17 of the fund managers — including two sums of 100,000 sUSD each, and 15 investments of between 10,000 and 50,000 sUSD. A further 10,000 sUSD will be distributed to 16 other fund managers each.