When we think about all the things Decentralized Finance (DeFi) has the potential to do, activities such as peer-to-peer lending, crypto transfers and automated payments spring to mind. But many, such as major strategic investor Kevin O’Leary, are focused on other areas. While hope springs eternal that DeFi may eventually supplant the middleman-dominated financial services industry, it may provide unheralded benefits for millions of mature investors—yield. WonderFi Technologies (NEO:WNDR) is seeking to facilitate an intuitive platform to do just that.
As Kevin explains it, his interest in DeFi piqued about 18 months ago when his group divesting a significant portion of its commercial retail portfolio. The subsequent sales generated a lot of cash, and Kevin was looking for a higher-yielding investment vehicle than the twenty basis points (0.20%) he was making in other consumer activities. With U.S. inflation running at 5.4% on an annualized basis, purchasing power of these funds would degrade significantly if alternative options were not secured.
Upon researching other solutions, Kevin stumbled upon stablecoins, which are are a type of cryptocurrency linked to an asset like the U.S. dollar that doesn’t change much in value. Although it took awhile to navigate through the myriad of compliance, reporting and regulatory grey-area involved in the space, Kevin stuck with it. Within a few months, he began writing contracts on USDC and began earning high interest on his money. Much more than would ever be possible from parked funds at a traditional bank.
A subsequent meeting with WonderFi Technologies CEO Ben Samaroo would be the catalyst to drive Kevin’s strategic investment in the space. With a strong engineering team in place, successful track record at First Coin Capital and cohesive mission statement, Kevin O’Leary committed and lead the company’s signature pre-public $20 million financing round.
And that’s when I ran into (CEO) Ben and he had figured it out. So that anybody like my daughter—or another 100 million people just like her—that don’t have a chance to make yield on their… It’s just one aspect of DeFi and so attractive right now. That’s the genesis of my involvement in the company. I talked to Josh (Richards)—he’s the whole ‘Gen Z’ thing. He’s got, you know, 40 million followers—they also want to make interest on their savings. Who knew? And all of a sudden, we started to work together on this project. I think this is going to be very successful.
As part of WonderFi’s business strategy, the company will invest funds not used in the deployment of its other business lines in crypto assets. These assets may be employed through various decentralized finance protocols to generate yield. The mission: to develop a platform with enough usability for the technologically unsavvy to appeal to the masses—whether it be peer-to-peer lending, crypto transfers, automated payments or yield through savings.
Click on the embedded link for our interview with WonderFi Technologies CEO Ben Samaroo and Strategic Investor Kevin O’Leary, in their own words.