The challenge of uniting CeFi and DeFi polarity

In the previous cycle, the yield market started to exhibit a particular polarity: CeFi and DeFi.

From my point of view, CeFi is the centralized organism that provides financial services to the masses. It has an appealing Web2 interface, an easy onboarding process, a team that can be found on LinkedIn, and no gas fees. Examples are Nexo, Celsius, FTX, Binance, and BlockFi.

In the previous cycles, it was a market of more than $35bln. Most of those assets were parked in DeFi (stETH, UST, LPs), Crypto hedge funds, or loans for market makers (FTX, Wintermute).

The irony of the centralized entity that provides interest rates is that it has the same risk levels as managing a yield portfolio yourself, but takes away an unknown cut of the yields that they generate to finance the centralized organism.

Obviously, with the contagion of the market in the previous cycle everything got wiped out starting with stETH depeg and UST collapse, which were the base yields for the whole market.

The DeFi market of the previous cycle was a closed self-referencing cryptosystem. Teams were building tech for abstract coins and tokens (LPs, Lendings, Exchanges). The first iteration of such tech is always about earning rewards in “funny tokens”, because you want to build as fast as possible and see what tech survives. For example, out of hundreds of yield farms on BNB only pancakeswap survived.

But in the last two years, the DeFi market has seen an increasing number of yield mechanisms that are not self-referencing, introducing ETH staking, T-bills, MEV rewards, revenue share, tranches, and so on. This creates more diversified yield systems that are much more reliable than in previous cycles.

DeFi, like every new technology, is struggling in terms of acquiring new cohorts of users due to the conceptual language, technical restrictions, and fears about it.

Therefore, the goal is to combine a mobile CeFi-like interface while maintaining a semi-custodial approach, along with the most secure yields available in DeFi.

So, imagine a semi-custodial web app on your browser, with email login, no gas fees, instant transactions, and 0% on- and off-ramp. And in one click you are depositing into the vast array of USD yield strategies across all EVM chains. A rebalancing index of Pendle’s PT positions, Aave, Compound, and Venus lending rates, Ethena’s LP, and so on.?

Additionally, you can seamlessly swap in and out of index strategies without any lockups or fees, giving you the flexibility to manage your investments as needed.

These index strategies can also be used as collateral for borrowing cash, ensuring you can meet financial needs without exiting your yield-bearing holdings.

This can create the largest funnel for onboarding capital into DeFi while giving the end user direct exposure to the safest market yields without losing access to the funds.?

We hope that this kind of product can make the wealth generation process much easier for all the global communities, especially those without access to sophisticated banking services, and create a new era of Decentralized Neobanking.