Tomorrow’s markets are going to be easier to navigate, or so we’re told by anyone close to decentralized finance (DeFi).
The essential promise of DeFi is that it could lead to an altogether more efficient, more democratic form of finance. It promises a system that’s cheaper, faster, more transparent and less prone to manipulation by powerful centralized institutions like the Federal Reserve, or the tech giants operating in Silicon Valley.
The goal is to eliminate middlemen like global banks and tech platforms that serve only to enrich the users who own them, and instead spread the potential gains from payment and digital platforms owned by users in a more open, democratic digital economy with a more efficient financial system. The disruption potential here is evident. It wants to redistribute funds and wealth from the few to the many and break the antiquated systems of wealth that have produced so much inequality for so long.
Except that’s probably not going to happen.
Free markets aren’t so free
The core ideological assumption here is that the markets and individuals and companies suffering the disruption are going to resist and be defeated and ultimately accept their fate, except that’s really not what happens. Instead, the neoliberal ethos takes over: where there are new room for people to make markets, new markets will be made. Financial distribution remains un-distributed and the rich get richer while the poor stay the same.
Take it from the trajectory of cryptocurrrency and blockchain markets. The original ideology followed the same kind of lines. Bitcoin was supposed to democratize and redistribute wealth courtesy of transparency and decentralization, and it’s only managed to become silo’d off from the people it’s meant to help by a mix of high production cost to mine, and the exorbitant price to buy. Ditto for Ethereum.
The reality is that there’s money to be made in Bitcoin and the alts, and companies have decided to get some of it. DeFi’s reasonably new in terms of sector development, but it doesn’t take a crystal ball to figure out that the same will happen there when hungry big name institutional investors figure out how to make it work in their favour.
There aren’t many publicly-traded companies into DeFi right now. There’s a handful operating at the periphery, offering connections and exposure to start-ups and entry-level decentralized finance opportunities, but nothing that looks like anything serious. Except for Wellfield Technologies (WLFD.V), which represents the best among them. Why? Because unlike the rest, they actually have products that provide gateways and access to the sector.
What is Wellfield?
Wellfield is the business combination of Seamless Logic and Moneyclip Inc with a numbered corporation. They have only been live for not even a month, but they’re already making inroads into the sector by building open and accessible protocols and blockchain-based products.
Their first product is called Seamless. It connects the Bitcoin blockchain to Ethereum to allow for seamless transactions and transfers between, thereby allowing transactions on the Ethereum blockchain to happen in Bitcoin. This gives another outlet for liquidity rather than just through fiat, or stablecoins, like USDT and USDC.
The problem this one solves is that of interoperability. Blockchains, especially Bitcoin and Ethereum, don’t communicate well due to being written using not only different operating languages but completely different platforms. This allows interconnection so it becomes possible for Ethereum to accept payment in Bitcoin. This produces more liquidity in Ethereum’s markets. You get the idea.
MoneyClip is Wellfield’s second offering. It’s an application layer brand that aggregates DeFi’s products (bank accounts, liquidity pools for lending, etc) into one easy to use application. Essentially, it’s a wallet with some extra functions attached that provides access to all the services normally provide on the Ethereum blockchain.
There’s another problem with DeFi and its ecosystem that may fly under the radar until you finally get in there and get involved, and that’s often that the people can come off as either shady, ignorant or sometimes—shall we say, ideological. By shady, I mean they’re always trying to sell you on their latest project, and if you’re at all intrigued by their salesmanship, once you get inside and do your own due diligence, their project seems to be lacking a few key ingredients in terms of the tech.
Periodically on discord someone from a decentralized autonomous organization (DAO) will bounce off of the Polkadot server and throw me a pitch about their pet project. I was excited the first time it happened and then it started happening more. And more. Now when it happens I give them five minutes to prove to me that they’re not a waste of my fucking time, or get fucked. Yes. Some of my experiences haven’t been charming.
In one particular case there was something that didn’t add up. My experience, thus far, has been with liquidity pools and staking markets. One project I audited included investment of a stablecoin, which would be locked away to add liquidity and exchanged for a proprietary token. This is normal. The token itself can usually be swapped at any time on a DEX like Uniswap, and it’s not at all hinky. What was hinky was that the proprietary token was supposed to produce return on investment based on a staking percentage, and delving deeper, one discovered there was no blockchain.
No blockchain means no staking. No staking means no locus of growth EXCEPT for the repeated addition of more investment. That spells a ponzi scheme. When I brought it to their attention, they said that they hadn’t brought the system online yet (and wouldn’t verify the existence of the system beyond that). I couldn’t refute or confirm that this was a legit enterprise, and that was enough for me to get away without getting involved.
That’s the kind of thing you need to be mindful of when getting into DeFi on your own and probably the biggest and best selling point for a company like Wellfield. Let them do the vetting. You can still benefit from decentralized finance without having to meet the wizard running the show behind the curtain.
Here’s who’s running the show at Wellfield.
They have Marc Lustig at the helm. He’s an entrepreneur, and former chairman, CEO and founder of Origin House, with knowledge and contacts galore in the industry. Since the merger of Origin House and Cresco Labs (CL.C), he’s been focused on managing L4 capital, his investment company, and serving on the boards of several companies. He has a nose for excellent investments and has made them all over town.
Here’s what Equity Guru’s own Chris Parry had to say about Lustig’s involvement:
“‘You know Marc Lustig? Yeah, he owns some of this.’ – I have heard these words from SO MANY EXECS, because Lustig has a rep that is well earned, stemming from his lack of duplicity. If he’s in, he’s not shorting in three and a half months, he’s IN. And he’s bringing friends. And he’s adding value.
So when he decided to come out of the woods on Wellfield and be front and center, that’s a big deal. That’s reason to watchlist the ticker.”
Levy Cohen brings experience with tech-driven banking and payments companies in both Israel and Silicon Valley. He’s a seasoned technologies focused on research and development in computer science an blockchain technologies. You want a tech guy running a company like this. Let Lustig handle the financial angle.
Also, recently Wellfield added Dr. Tamir Agmon, a professor, researcher and global financial consultant to their advisory board. Dr Agmon comes to Wellfield by way of Seamless Logic Software, in which he was a founding partner. He’s been engaged in researching decentralize trading and the DeFi market—and more specifically applications of financial economics in the DeFi ecosystem.
“One of the most-common ways that technology companies fail is by focusing only on developing great underlying technology without building a path to real-world application and adoption. Tamir’s deep experience and ongoing research on the evolving decentralized financial market and trading protocols, as well as his expertise in the venture capital world, have been critical in focusing our team on developing practical solutions — based on great tech — that are necessary to unlock the power of DeFi. As we look forward to launching our Seamless protocols in 2022 and beyond, Tamir’s continued expertise will help ensure that Wellfield delivers strong, value-adding blockchain solutions for financial industry participants,” said Cohen.
Dr. Agmon is a professor of finance (emeritus) at the Collier School of Management at Tel Aviv University, Israel, and visiting professor of finance at the University of Gothenburg in Sweden. He was designated an honorary doctor of economics in 2020, but before that he graduated with a PhD in finance from the University of Chicago, and has held appointments at MIT and USC.
If you’re looking to get into the billions-strong and growing decentralized finance markets, would you rather the shady blue-hair who’s promising up and down their project isn’t a ponzi scheme but can’t provide proof, or the dignified professor of finance, who can not only explain why it’s not a ponzi scheme, but prove it?
This one’s a no-brainer.
Full disclosure: Wellfield Technologies is an equity.guru marketing client.