DeFi has been one of the most exciting innovations in the world of cryptocurrencies and blockchain technology in recent years. With its potential to disrupt the traditional financial system, DeFi has attracted the attention of investors, entrepreneurs, and developers worldwide. However, as the DeFi ecosystem continues to grow, the need for more robust and secure protocols becomes increasingly important. This is where institutional-grade DeFi protocols come in as it paves the way for large-cap investors to enter the market. In a recent press release, Japanese investment banking giant Nomura’s digital asset subsidiary, Laser Digital, has announced a strategic investment in institutional-grade decentralized finance (DeFi) protocol Infinity Exchange.
Infinity Exchange Leads DeFi With Nomura’s Laser Digital
In the exciting and ever-changing world of cryptocurrency, institutional investors are increasingly showing interest in the growing DeFi space. Recently, Laser Digital, the crypto-focused subsidiary of Japanese financial services giant Nomura, has made a bold move to capture a piece of the DeFi market by investing in Infinity Exchange.
Infinity Exchange is a DeFi protocol that focuses on providing lending and borrowing services to institutional investors, and its integration with blockchain technology has already caught the attention of many institutional players. The platform offers its users a secure and decentralized ecosystem, ensuring transparency, efficiency, and flexibility in their financial transactions. Infinity was founded last year by Lepsoe, a former head of structuring and financial engineering at Morgan Stanley in Hong Kong, with the goal of driving institutional adoption of DeFi. Built on the Ethereum blockchain, the platform provides users with access to both fixed and floating interest rates, as well as the ability to trade interest rates, according to Lepsoe.
Laser’s Investment Sparks Fresh Excitement Among Investors
According to Infinity founder and CEO Kevin Lepsoe, Laser’s investment in the DeFi protocol is in addition to the $4.2 million seed funding round that Infinity raised in September of last year. The previous round saw contributions from various investors, including GSR and Flow Traders. However, Lepsoe remained tight-lipped about the valuation of the company and whether the funding was secured through equity or token rounds. Olivier Dang, head of ventures at Laser Digital, said, “Infinity’s groundwork paves the way for institutional flows on-chain, new levels of rates and risk innovation.”
Lepsoe highlighted that the interest rate mechanism and risk management system are key distinguishing features that set Infinity apart from other DeFi protocols. He said, “For example, on Compound, a lender would receive 0.03%, while a borrower would pay 2.86% on WBTC. As compared, on Infinity, lenders and borrowers would pay and receive the same interest rate (1.5%, as an example), excluding fees, whereby the lender would receive 1.47% ‘more’ and the borrower would pay 1.36% ‘less’ by using Infinity, as compared with the Compound (current) rates mentioned above.”
According to Lepsoe, Infinity’s risk management system enables the protocol to manage collateral in the form of both ERC-20 and ERC-721 tokens. He further noted, “A user could deposit USDC with Aave and receive aUSDC, transfer this aUSDC to Infinity, and borrow against this as collateral,” he said. “In effect, Infinity’s risk management system provides a venue of external liquidity in deposit and LP [liquidity provider] tokens, which otherwise would have a limited (if any) external avenue of liquidity.”
Lepsoe has revealed that the Infinity protocol is currently available on the Goerli testnet, and the mainnet is predicted to launch by the end of the second quarter. To support the launch, the company plans to expand its team of 12 employees as it continues to build and refine its platform. Olivier Dang noted that Infinity is creating infrastructure that is focused on institutional adoption of Web3, making it a primary reason why Laser chose to back the project.
In addition to Infinity, Nomura and Laser have invested in four other crypto firms, including Komainu, Bullish, Allinfra, and Orderly Network. According to Dang, there are three more investments in crypto companies that will be announced in the near future.
