DeFi for the Masses

Valentin Pletnev was frustrated with economies that recklessly print money and intensify the struggle of their citizens. In crypto he found an ungoverned terrain to enact change. So he co-founded Quasar Finance, a decentralized finance (DeFi) project in the Cosmos ecosystem with plans for chain-agnostic investment opportunities.

Valentin Pletnev is presenting at Investing in Digital Enterprises and Assets Summit (I.D.E.A.S.), CoinDesk’s newest event revealing the most scalable marketplaces in the digital economy that will attract institutional capital in the years to come. Learn directly from entrepreneurs in leading innovation across digital assets, Web3, blockchain and the metaverse. Register here.

While crypto offers open and transparent monetary policies, investing in it is not for the meek. Investment options range from JPEGs of monkeys to labyrinthic multi-level yield optimization strategies that yoke your coins through 18 different global platforms to reap x% more of something. And in the base case, investing in the primates outperforms. A select few can fluently navigate it, but the balance of humanity can’t be expected to parse crypto’s spread of opportunity.

To help average users, crypto entrepreneurs have devised vault strategies. Quasar hopes to propagate these across crypto ecosystems. “Scaling intake of capital for professional asset managers is not easy. We leverage DeFi’s inherent benefits to allow for scalable global capital exodus,” Pletnev said in an interview with CoinDesk.

A primer on DeFi vaults

Vaults are investment vessels designed by experts for use by novices. They connect often-complex trading strategies with the capital of retail investors. Passive investors see their balance grow (hopefully) as a result of previously inaccessible investment strategies. And the designers of those strategies take a cut of the yield from investing capital they otherwise couldn’t have sourced.

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Vaults often support deeply complex financial engineering to extract the highest yield possible. “The vault enables you to pool money and execute a common goal,” said Pletnev. “Strategies can be arbitrage and delta neutral strategies, leveraged positions in predictive buying, predictive selling, literally anything.”

Vaults aren’t new. They’re at the core of now-legacy protocols like Yearn Finance, which helped spark the DeFi bull run of 2020. Quasar hopes to build a product for the next generation of yield strategies that cross crypto ecosystems.

To a multi-blockchain world

Quasar will utilize the Inter-Blockchain Communication (IBC) protocol to broaden the ecosystem real estate that vault strategies can traverse. Often, decentralized finance applications are limited to their native chain – segregated ecosystems limit the strategies that DeFi yield artisans can craft.

Bridging ecosystems is desirable because it expands the liquidity available and offers cross-ecosystem arbitrage opportunities. Quasar could eventually offer vault strategies that span Ethereum and Cosmos among others.

The good of it

When COVID-19 hit, Pletnev’s parents lent him a slug of capital to invest. His investments performed well enough that neighbors wanted to deposit into this homegrown “fund” – but there are laws that prevent that sort of thing.

Access to financial opportunity and literacy, even in our commercial age, are often overlooked luxuries – something Pletnev knows firsthand. Both his parents were born in formerly Soviet states. “It’s really crazy how very little people in the West are aware of the kind of loops that people have to go through to reach their system,” he said.

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From there, the appeal to DeFi is obvious. Government barriers and the annoyance and cost of physical-world financial advice and services create a market for easily accessible DeFi strategies. Crypto already offers global permissionless access to funds and transfers – but if only the savviest users can access the most remunerative opportunities, the social good will be limited. Quasar hopes to expand both the range of vault strategies on offer and the number of people with access to them.

If all goes to plan, Quasar will go live on Cosmos Mainnet around the end of 2022, connecting complete novices with some of DeFi’s most complex opportunities. “I want my mom to use the app,” Pletnev said.