Battle for the primacy of investment: DeFi is altering the status quo

investment world is changing and the balance is tilting in favor of small investors. Look around you and you will see that the entire cosmos of the financial capital is still an elite sport. This is because the current caral is based on big investors making big profits.

On the other hand, the era of disruptive technologies is fast approaching. main drivers are blockchain (DLT), artificial intelligence, machine learning, robotics, genome sequencing (CRISPR), and energy storage technology, all of which have the biggest impact on the global economy.

Speaking of impact, the 50 private disruptive innovation companies have been selected by CNBC. y use the owner Disruptive Methodology 50 with an implicit valuation of more than $ 388 billion.

In fact, in 2020, 13 out of 50 reached public companies through IPOs. Others showed exponential year-on-year growth of around 300%, according to the Disruptor 50 index.

This is the tip of the iceberg. It is only a small part of the private market capitalization. Now think of public companies, other startups, SMEs, and private innovation labs not covered here.

All of these have enormous potential that is waiting for investors to unlock.

Investment in access control

Here is the problem. Under SEC rules, only so-called accredited investors – basically people with a net worth greater than $ 1 million – can enter disruptive global investments in the United States. Obviously, there is enormous potential for reform here.

On the other hand, the risk capacity of disruptive technology does not work well for institutional investors. This is due to the traditional and retrograde patterns that drive them. However, innovation happens in the future.

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In its scope, disruptive technology numbers are mapped to some benchmarks and metrics based on past results, which translate into ‘no go’ decisions.

Simply put, the muscle memory of the internet bubble and other crises does not open our eyes to the potential exponential growth buried in disruptive technology.

Furthermore, the analysis horizon of an institutional investor is usually only one year. In comparison, exponential growth occurs over a longer period (~ 5 years). As you can see, many fundamental disconnects are blocking the way forward for institutional investors.

How can we bring power to retail investors?

Decentralized Finance (DeFi) means that finance capital no longer requires powerful middlemen or middlemen of any kind.

Currently, intermediaries are very necessary for the parties to establish trust in transactions, commercial contracts or investments. Payment for the services of these intermediaries can be written off as the cost of doing business for large corporations and wealthy individuals. However, these expenses remain prohibitive barriers for many retail investors.

With DeFi, anyone with an Internet connection can do business globally at whatever level they can afford. In addition, the tokens manage these offers.

Only your personal risk preferences define the DeFi protocol match. Along with the time you like to freeze your funds obtaining a high return. It’s worth noting that your funds here don’t come out of your digital wallet. refore, you still have the fully controlled property in your pocket.

advantages of DeFi

benefits of decentralized investing are too many to ignore. y include less friction for transactions due to automation, much faster results and analysis of market conditions (in real time), greater security through transparency and a higher level of personalization of financial products and services, just for name a few.

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Think of the emerging gig economy, where no one seems to have a steady job anymore, where each of us is some kind of professional mercenary, moving from one gig to another.

Instead of paying brokers to facilitate your investments, you can now simply invest directly in the businesses that interest you. se include areas that were previously out of reach, such as art, music, technologies, or a basket of world-changing technologies. Finally, and most importantly, you can finally invest in human capital or just people.

Embrace the opening

From a technology standpoint, we are faced with a radical amount of openness: open source, open data, and open markets.

re is no way to hide inefficiencies that are not currently visible due to politics, regulations, and institutional bureaucracy in such an environment.

Additionally, the open source nature of community investment research data further empowers retail investors.

An inclusive Web 3.0 and DeFi caral incentivizes retail investors, not institutional ones. For the first time in history, retail investors may be better informed than institutional investors, so the severity of power is changing very rapidly.

This is not a zero sum game. It’s a positive-sum game in which DeFi, powered by Web 3.0, is an exit from Wall Street and the beginning of a renaissance for retail investors.


All information on our website is published in good faith and for general information purposes only. Any action taken by the reader on the information found on our website is strictly at your own risk.

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