TL;DR Breakdown
- Soros Fund Management has cashed out their funds from stocks, shifting to DeFi investment.
- DeFi adoption has surged significantly, dominating general cryptocurrencies.
Soros Fund Management, the American investment management firm, recently announced that it has liquidated the $5 billion stock investment. The $27 billion company had invested these funds in early 2020 during COVID-19 market instability.
The Chief Executive Officer (CEO) of the investment giant, Dawn Fitzpatrick, also said that the company has decided to redirect these funds to Decentralized Finance (DeFi). This is one of the examples of the shift in the interest of several multi-billion dollar companies after the huge success of Blockchain technology and DeFi protocols.
In DeFi, a user invests and trades the asset in a distributed environment without any control by any central entity. The system, thus, offers security, transparency, reliability, and avoidance of inflationary tendencies.
Soros Fund Management accepts DeFi dominance
Soros Fund Management CEO revealed that they own some crypto assets in its portfolio and are planning to expand it. Dawn expressed her views on DeFi dominance by saying that the crypto coins are becoming less compulsive than the DeFi use cases.
“We own some coins — not a lot — but the coins themselves are less interesting than the use cases of Defi and things like that. Cryptocurrencies have gone mainstream.”
According to a recent study, DeFi adoption by different institutions has surged the protocols’ valuation by 800%, and the recent 35% rise of Uniswap is just another example. The Chinese crackdown worked as a catalyst for shifting all Chinese investors towards DeFi protocols.
Chainalysis recently published a study report on virtual currency adoption and reported an excellent growth of the DeFi sector in less than a year.
Chainalysis also added that according to the Global crypto adoption index, it had been noticed that the Central and Southern Asia and Oceania (CSAO) region is most interested in DeFi protocols. This includes countries like India, Vietnam, and Pakistan.
Hacks in DeFi space
Everything comes with a price. As there is a spike in the popularity of DeFi tokens, the not-required hacks have also arrived. There are reports about different protocols suffering from these attacks; the latest one is Stakesteak’s.
While Defi provides transparency through powerful smart contract architecture for blockchain and makes government approval more attainable due to its solid technology, but Defi breaches are currently the main obstacle to its possible expansion.
