Senior product designer / cryptocurrency investor
The year we’ve just left behind is going to leave a long-lasting memory in the minds of people for a long time after. The unprecedented events linked to the lightning spread of COVID-19 across the world forced an imposition of stringent governmental measures, which in turn entailed a radical reconsideration of our lifestyle and values. The results were also quick to follow: the market crash faced the sharpest decline since 2008, while many people abandoned their financial options in a search for alternative investments; DeFi came as a worthy candidate.
2020 will also be remembered as a “year of DeFi”. There’s now $22.5 billion collectively stored within the space, from a humble start of under $800 million just one year back. The ascend of DeFi, however, was not all that smooth and easy being accompanied by many bumps on the way. This spectacular growth brought a number of complications, such as the highest number of hacker attacks that robbed the victims of $100 million last year. This impressive number takes the share of 21% of all crypto offenses in 2020 and is anticipated to grow even more in 2021.
Until the time when solid regulations get grounded in DeFi, many entrants remain fully exposed to the dangers of the big world. However, the good news is that certain platforms – like EmergeDeFi – already seem to offer an exhaustive answer to the problems of kick-starting an own blockchain-based platform. This launchpad provides assistance in bringing the project to life by leveraging the network of partners and resources and could help the project to evolve from any stage – starting from product development all the way to media promotion and sales.
I asked Matt Haynes 10 questions about the challenges of entrepreneurship in DeFi, its inner capacity to overturn the conventional state of affairs, and even how DeFi can become the much-needed change in the painful times of COVID-19.
1. Could you please describe your anticipations from the year ahead of DeFi? What would be the main trends in the field that crossed the borderline and stepped into the mainstream?
First of all, let us not forget that DeFi is only an emerging trend. While the year 2020 has been spectacular in all ways, we should not downgrade our expectations of the future five years or so. DeFi is only starting to touch the massive audience. While some of the brave entrepreneurs and early adopters have already experienced it, there’s still a bulk of consumers who have no conception of it whatsoever! Like with the internet. It started humbly, but step by step gained the ground, leading to the point when it took over the world. So that now nobody even remembers the way they lived without it, in this pre-historic era without the internet. Pretty sure a similar future awaits for DeFi.
Though many denied its real force at first, saying that it’s just a speculative bubble, it is much more than this, I can assure you. And 2021 will become another proof of that. What’s most likely to happen is this: the regulators will finally turn their heads to everything that has a ‘blockchain’ mention in it, and everything that comes to exist via ‘tokens’. What I can almost guarantee, the scams rate will go down, all these crooks will run away as soon as they see imposing regulators who are chasing after them. This will already put an end to many challenges.
Another thing is, let us not forget that DeFi was created by people and for people, democratization is one of its core principles of this ecosystem. What I think we will all see pretty soon, all consumers around the world will be after DeFi once realizing that it’s times cheaper, faster, safer than many of those rusty platforms we had to use out of no alternative. Now, the power is in the hands of consumers, and this will mark the start of the new era in finance, insurance, procurement and shopping, and many other things that can even come to our mind. DeFi will play a leading role in transforming our world.
2. Can you point to the aspects that come as the most difficult while launching the new blockchain-based project? What would you suggest to overcome that difficulty?
Definitely, the assembly of the right team is the challenge that everyone has to overcome. What you need, especially at the beginning, is a core group of dedicated people that will stay with you until the end and put all their last forces into the project. This is the question that has to be sorted out before even starting. The core team has to be formed out of those people for whom you know the project is as important as it is for you, if not even more important! Let them be skilled, competent, open to new ideas, and fully devoted to every tiny thing that they do.
This especially goes with regards to developers who, you know, will get the highest responsibility, especially at the start. Depending on their skill and the ability to put your ideas into action, propose their own thoughts and suggestions, as well as foreseeing the loopholes that may crop up in the future, depends on the success of the whole affair. So each young entrepreneur should realize it and approach the matter seriously.
My personal advice - always deal with the people whom you trust, the ones whom you have tested before, and in whose success you’re confident as in your own. I know it is far from being easy and you may spend loads of time looking for the right person, but eventually, I can guarantee, your efforts will be paid off in full amount. Your team is almost 80% guarantee of your success.
3. The news headlines tell that DeFi scams get approval to operate even on reliable platforms like Binance. Are there any ways in which one can build an effective security defense against hacker raids?
Without question. Experienced users have been dealing with this problem over and over again, that’s what I can say, but of course, for novices this type of precautionary measures all the more important, as they are the group the most exposed to the risk.
First of all, to our disappointment I have to say that unfortunately, there are no ways to fully avoid hacker attacks. They get very creative in finding ways to extort our precious pennies, especially far away from licensed exchanges, I’m not even talking about decentralized ones.
But let’s keep in mind a few simple tips. The user, especially a new one, is highly advised to keep the savings away from the wallet on the exchange. A cold wallet is the safest way - it’s easy to find it and buy it on the internet, but you have to keep a keen eye on it from getting lost because it actually looks a lot like an ordinary USB device.
Another thing on the ‘not-to-do’ list is to never forget your password, and ideally, even store it in the place only you have access to. One more very useful measure against the hack is two-factor authentication, which is kind of the basic level of security and works when the user receives the text and logs in. But for more active users, I highly recommend multi-factor authentication, as it may save your life even during the site breach.
Always remember one thing - you as the user is the one who owns the money, and this is your responsibility to protect it, not the one of the exchange. In most cases, they will not even help you, so don’t count on compensation from their end. In case of a problem, all consequences will lie on your shoulders, not on the exchange platform. Never overlook this fact, and always think about your own security in the first place.
4. Currently, the Ethereum blockchain is the most dominant system on which DeFi developers build up their applications. For how long, in your opinion, will the Ethereum dominance last? Alternatively, do you see any blockchain solutions that could challenge Ethereum?
For now, I think, yes, it’s the most dominant system really. It all comes down to its speed, lower transaction cost, high capacity to accommodate all sorts of applications, and of course, a smart contract that was created specifically by Ethereum. All these factors really matter for developers up to these days, and I don’t think they ever stop being relevant.
But what we have to pay attention to is the next generation of chains - these are called cross-chain technologies, which allow us to translate one blockchain into another, and bind a few private ones into one. Polkadot is one example. I think these will be a real breakthrough, and especially now, in 2021, they will gain momentum. Whether they replace Ethereum or not is hard to tell, but they will definitely be a decent rival thanks to their highly advanced functionality.
5. Have you stumbled across any project that you would ascribe with higher chances of dominating the DeFi horizon in the next 1-3 years, let’s say?
In my honest opinion, the market is so dynamic and unpredictable that it’s hard to describe one clear winner and say yes, this company will definitely lead the market in the next years to come. From what we’ve seen so far, the top positions are usually taken by companies who bring additional value on top of what has existed before them. That was the case with MakerDAO and Compound, they still take the leading positions because, well, they were the first ones to surf the rising wave of yield farming. Uniswap and SushiSwap are other prominent faces of DeFi for their popularity they owe to a people’s desire to get away from centralized exchanges and start trading crypto independently.
Let us be realistic - looking at the dynamic of the DeFi progress, it is hard to say what’s gonna be there in one year or two, just because DeFi is so unpredictable that nobody knows what’s gonna happen next. We can, of course, build assumptions that the companies that drive the market now won’t be lagging too far behind, but the future progress is mostly dependent on innovation - the one who proposes the most grabbing idea is going to set the pace for the rest. However, let’s not ignore the fact that the primacy on the short run does not necessarily lead you to be the winner on a long and tiring race.
6. What would be your advice to all entrepreneurs who are switching to DeFi after trying themselves in other fields of activity?
Other? Like computer science, that’s what you mean? I think it’s important to keep in mind that DeFi is a fresh and open niche, and right now it’s rather like a vast and unexplored ocean. It is full of opportunities that you may be the first one to explore, but at the same time, the sharks will chase after you all the way through, so stay alert all till the end.
This is not a safe environment with decades of evolution behind, no; rather, this is something that came to exist as a result of technology that became known only a little more than ten years ago. Throughout this decade, the opportunities of blockchain have been studied only by a minor group of fans, although the most vigilant specialists have already foreseen that it’s going to lead to a huge transformation in literally all spheres of human activity.
However, at the present stage, there’s still only a handful of those who understand what blockchain really is, and what enormous potential it stores behind the curtain - which is way more far-reaching than celebrated Bitcoin. Bitcoin is a passing fad, it won’t be of any surprise to me if in 10 years' time nobody is going to speak about it other than as a large speculation scheme. But what really matters, what has a weight today, tomorrow, in ten and twenty years from now is what this thing can do. Bitcoin can do nothing; blockchain can do everything. We will find many ways to apply blockchain here and there, you will see how our world will be transformed into a more digitized, transparent one.
That’s why the ones who start experimenting with blockchain now can very well become the unicorns of tomorrow - and it depends only on you how far you take your project, how distinct your proposition is, how many followers you attract and how well you manage to capture a global share. The rules of the business would be pretty much the same as in any other field of activity, but what’s really different is the number of fresh ideas and hard work you infuse into your project to build something truly unique and attention-grabbing.
7. What is the most effective way to declare yourself to the world if you are a new face in the blockchain industry?
The core, as it has always been and remains, is your market proposition. It is all about the real value of your product/service, and how likely it is to sustain the trial of time and the growth of the competition. So, I’d say, if you have a real earth-shaker, people will get to know about it anyway. But that has to be something completely distinct, something that the market has not seen before, and something that would be interesting to anyone, especially for the growing base of the new consumers swallowed by DeFi.
As an entrepreneur, if you keep being innovative and propose something nobody has ever tried before you, you will reach the highest top. That’s why keep being brave and experimenting, there’s no right or wrong yet in the world of DeFi. It’s equally open to everybody, and especially to the ones who have a real word to say, who have prepared something that will turn the lives of thousands of people upside down, those are especially welcome to DeFi. The most important is the product creation and proposition itself; the rest will follow.
8. And now a few questions about EmergeDeFi: I’m being curious, how do you manage to overcome the challenges of the various local regulatory systems that sometimes openly declare a war on cryptocurrencies and everything that has relation to it?
Well, most important it is to understand that we as EmergeDeFi do not specialize in cryptocurrencies; rather, what we do is help clients to upscale their DeFi projects, assist them in certain production stages including token launch or marketing activities, as well as bringing the project in front of the whole massive audience.
What I can say, the regulatory system is not a problem for as long as we are not planning to kick-start a massive project on the scale of Facebook’s Libra. But usually, our clients register their entities in crypto-friendly countries like Malta, Cyprus or Switzerland, and carry out all their administrative operations on these territories. That allows them to escape lots of regulatory pain in the future.
9. Also, could you please tell our readers more about the EMERG staking program? What are the returns one may expect from participating?
Gladly! By staking EMERG, our native token, the participants will be able to get the split of our corporate sales, which amounts to the whole 1% of total Emerge selling activities. The distribution will be made in proportion to the amount staked, so those who put in more will correspondingly get the higher percentage of rewards. Let all our followers not forget that EMERG is also a governance token - that is, from the definition, all participants will be given the right to vote on decisions of Emerge and also receive awards. From all ends, I see only advantages!
10. Now, what is your plan for the upcoming 5 years? How many geographies are you planning to embrace under your scope, and what’s the expected user base under EmergeDeFi?
On the list of our future plans, what we aim to do is to attract projects from all over the globe and give them the opportunity to shine with our launchpad. We are not limited to any specific geography. In all honesty, I think this is no longer a limitation, especially in the present age of the global economy and the global marketplace formed by it.
However, I have a feeling that the clients from emerging regions, like Africa, will be especially in demand of our services, mostly because of the poor infrastructure back home and the know-how we may share with them. Africa and Asia will be trendsetters when it comes to global growth, mostly because of the amount of poor severely affected by COVID-19. These regions are desperately in need of new solutions that will solve the decades-long problems these societies had to live with. Thankfully, now with DeFi and blockchain, the new era has come to make everyone better off than they would otherwise be.
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