One of the largest crypto trading companies is betting that DeFi will be as big as the centralized crypto market

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Episode 72 of Season 3 of The Scoop was recorded remotely with The Blocks Frank Chaparro and Jake Dwyer, Head of DeFi at GSR.

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GSR is building a space at the intersection of traditional and decentralized financial worlds, according to its new DeFi director, Jake Dwyer.

During the last episode of The Scoop podcast, Dwyer explained that the company is developing the ability to both create new trading products and provide liquidity to DeFi protocols in a way more familiar to traditional finance players who wish to become closer. implied.

With those plans in hand, GSR expects to contribute more than $ 1 billion in total stranded value over the next year, fueled in large part by rising interest from traditional funding sources.

“People are in pretty big positions just by being the early adopters of these protocols,” Dwyer said.

DeFi vs. CeFi

Over the past six months, GSR has expanded its venture capital investment activity into DeFi as a more central component of the business, keeping an eye on fixed income and credit protocols.

“You have things like Aave and Compound and others on other chains to borrow and lend. But we’ve seen a lot of innovations around Swivel and Tempest’s second-rate derivatives on the fixed and floating rate interest side. , Dwyer explained.

Dwyer is excited about the collateral and interest rate segment of the market, which he sees as innovating at a rapid pace. “I think a lot of these different types of fixed income derivative protocols that are out there are going to evolve in really exciting ways over the next few months.”

He believes DeFi will end up being more centralized activities as the market experiences more innovation.

“What DeFi is offering in some cases is just a sort of new set of venues that look a lot like the centralized venues that we’re used to negotiating over.” He cited GSR’s recent investments in Dydx and HashFlow, the latter being Dwyer said he recently reported $ 1 billion in transaction volume.

Consider a multi-channel future

Looking to the future, Dwyer said he believes he will be marked by a variety of networks that serve different purposes and in the background, in some cases.

“We believe that in the future, you won’t necessarily know which channel you interact with or care about,” he said.

According to Dwyer, these different chains will have different types of specialization, such as high speed, high settlement, and the ability to create a central limited order book.

Like he said: It’s almost like you want to use Uber and Lyft, you have to have two different phones, and that doesn’t seem like a sustainable way forward. “

2021 The Block Crypto, Inc. All rights reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial or other advice.

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