Coinbase Venture, the venture capital fund of the company has made its first investment in a startup called Compound which allows cryptocurrency to borrow digital currencies or lend them and earn interest over it. This shows that the cryptocurrency industry is adopting some cues from the traditional banking industry which allows users to receive interest on their digital currency holdings rather than just keeping them idle.
Coinbase was one of the eight participants in this $8.2 million seed-funding round with some other backers like Andreessen Horowitz, Bain Capital Ventures, and Polychain Capital besides participants from companies like Abstract Ventures, Danhua Capital, Transmedia Capital, and Compound Ventures.
Coinbase's first investment, , earns you interest on crypto
— Compound (@compoundfinance)
While talking to , Compound co-founder and CEO Robert Leshner said that the company will initially deal in digital currencies through the Ethereum blockchain but the company is further planning to have tokenized versions of the dollar, yen, euro or Google stock.
Leshner in his said: “We think it’s a game changer. Ninety percent of assets are sitting in people’s cold storage, or wallets, or exchanges. They aren’t being used or traded.”
He further added: “…when Compound launches it’s [sic] first money markets on the Ethereum blockchain, individuals, institutions and applications will earn interest on Ether, stablecoins and utility tokens, with complete liquidity — similar to the overnight rate for dollars and government currencies.”
There have been several token projects that have discussed the idea of generating interest or dividend income on crypto assets but it’s Compound who has shown how it’s done! Salil Deshpande, Managing Director at Bain Capital Ventures, in his blog post states that the existing lending solutions“are not good enough: they are either centralized and have substantial counterpart risk, or require robust order books for each type of cryptoasset, which generally do not exist.”
He further added: “Compound is decentralized blockchain infrastructure for enabling a clear use case — interest rates for cryptoassets — with a relentless focus on security and interoperability.”
Compound’s protocol comprises a series of open-source smart contracts which can themselves adjust the interest rates for each asset in real-time, as borrowing demand for the asset changes. The borrowers like sophisticated speculators or hedge funds will be using their portfolio as collateral in order to borrow from the protocol.
This will result in a “fully liquid, transparent and predictable interest rates — ready for developer and institutional adoption.”
Olaf Carlson-Wee of Polychain Capital said: “Spot interest rates are a financial primitive, and necessary for the evolution of decentralized markets. Compound’s goal is to become permanent infrastructure…A company that survives a hundred years.”
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With a new focus on security tokens and financial regulation, Keynote delivers their seventh World Blockchain Forum, the first ever in New York. Final ticket release begins 29th May.
Having produced two of 2018’s biggest bitcoin and blockchain events in Miami and Dubai, Keynote is honored to bring the World Blockchain Forum to the Big Apple as they host the first [WBF: Security Tokens & ICOs] on 12th and 13th June.
Held at Manhattan’s Metropolitan West, the intimate two day event includes a change in format with ‘ICO Pitch Panels’, where ICO projects will use a panel discussion platform to showcase their product moderated by blockchain visionary Moe Levin. Attendees will experience a comprehensive introduction from high profile industry experts including Vanessa Grellet, Bruce Fenton and Salil Donde, knowledgeable in not only blockchain and financial regulation but the complexities of Wall Street, offering invaluable insight into the future of security tokens.
Announcing lead partnerships with Victory Square Technologies and Polymath, this WBF speaker line up is set to deliver a groundbreaking agenda rounded off by Victory Square Director Peter Smyrniotis awarding the top 3 ICO/STO panelists with $100,000 shared investment.
In addition, WBF Dubai Environmental Sponsor Climate Futures, will return for WBF New York, after having retired over $14,000 in 1PLANET tokens to balance the carbon footprint of over 600 international flights to Dubai.
In a saturated environment of corporate blockchain events en masse, WBF maintains its 7-year long ambition to connect individuals and develop international relationships, giving sponsors a personal and rewarding experience long term. Projects wanting to exhibit alongside WBF regulars bitcoin.com and Academy School of Blockchain are advised to move quickly to secure limited last space in the vibrant Exhibiting & Networking Hall.
For final sponsorship and exhibiting availability please contact Tom Lunn at [tom@keynote.ae]
WBF New York speakers include:
Alex Mashinsky – Founder & CEO, Celsius
Bruce Fenton – Founder & CEO, Chainstone Labs
Salil Donde – CEO, AlphaPoint
Nick Spanos – Co-founder, Zap.org
Trevor Koverko – CEO, Polymath
Vanessa Grellet – Executive Director, ConsenSys
Halsey Minor – Founder, CNET
Oliver Gale – Executive Director, Bitt
Dawn Newton – COO, Netki
Veronica McGregor – Partner, Goodwin
Paul Puey – CEO, Edge
Jason King – Co-founder, Academy
Gabriel Abed – Chairman, Bitt
Steve Dakh – Ethereum, Aeternity, Kryptokit
“Though bitcoin and blockchain technology is rapidly becoming more understood, security tokens remain a black-box to most people. Which is strange, because as far as I can tell, the only real way to unlock the next trillion dollars of value in the ecosystem is by digitizing the traditional financial world through security tokens.” said Moe Levin, Founder and CEO of Keynote. “Showcasing the best and brightest in the industry has been the aim of Keynote since 2012, and we’re excited to be bringing the 7th edition of the World Blockchain Forum to New York City.”
For a full list of speakers visit:
Last tickets can be purchased at:
About Keynote
Keynote was launched in 2012 by blockchain strategist Moe Levin. Further information and details about Keynote and their events can be found at keynote.ae
For media inquiries, please contact Amandah Hendricks at amandah@keynote.ae
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