In an effort to increase institutional adoption of decentralized finance (DeFi), DeFi platform Infinity Exchange recently announced a $4.2 million seed investment.
Infinity Exchange is run by former Morgan Stanley executive Kevin Lepsoe, who left the traditional finance space to focus his attention on the opportunities that DeFi offers to investors.
The founder said that institutional investment is a vital part of developing DeFi 2.0 in its next iteration in order to lay strong economic frameworks.
Lepsoe believes that having access to a full rates product suite and fixed-to-floating rates would give more secure opportunities to institutional investors, as well as ensuring that individuals would receive equal pay rates.
He pointed out that the divergence between floating rates markets and fixed-rate markets is a significant drawback of the existing DeFi 1.0 space. Such situations, like the current DeFi setup, causes the capital to not flow as easily. This ultimately stops the markets from cooperating effectively.
The most recent round of funds will be utilized to develop Infinity’s product offerings. This will include fixed and variable rate markets, futures and spot trading markets, and so on.
The elements of TradFi — including comprehensive financial markets protocol and fixed and adjustable interest rates — urges the large institutions to enter the sector. Lepsoe said that this helps make up for the aforementioned current drawbacks of DeFi protocols as well.
He stated that such instruments for institutional investors provide a significant portion of the basis for possible market expansion of up to “1000 times what it is today.”