The tokens of the DeFi ecosystem are heckled. However, the market remains very buoyant for investors. The crypto hedge fund Panxora wants to raise 50 million dollars for a new fund to invest in DeFi tokens.
The DeFi market has been yo-yoing, to say the least, in recent weeks. In just a few months, the value of the assets involved in the protocols of the DeFi ecosystem has nevertheless exploded. At the beginning of September, this amount even reached 13 billion dollars.
If since then the funds in escrow have fallen back to around 9 billion dollars, the dynamic is indeed there in the decentralized finance sector. For institutional investors, the DeFi is therefore not lacking in attractions.
The recent “bloodbath” of DeFi tokens
A hedge fund specializing in cryptocurrencies, Panxora plans to raise up to $50 million to top up a new fund. The latter will then have the money to invest specifically in DeFi sector tokens.
“It has the potential to really change the way finance works,” Panxora CEO Gavin Smith told Coindesk. Nevertheless, the market remains very immature and subject to sudden movements.
After the sudden fall of several tokens, such as Aave’s LEND, several billion dollars evaporated. The crypto Messari company does not hesitate to speak of a “real bloodbath”. Its analysts even believe that the “casino” period could come to an end.
Tokens available on centralized exchanges
But that’s nothing to discourage Panxora. Its new hedge fund will be based in the Cayman Islands for regulatory reasons. The start of its trading activities is scheduled for November 2nd.
The fund will initially focus on the acquisition of tokens available from major centralized exchanges, Panxora details. For the time being, there is no question of turning to DeFi’s reference DEXs.
This choice would be justified by the difficulty, or even impossibility, for most decentralized exchanges to guarantee sufficient compliance with anti-money laundering rules. Moreover, centralized exchanges would provide a first level of control over the tokens they reference.