- Summary:
- Centralized DeFi is getting organized with the launch of an alliance that aims to bring the concept of CeDeFi to the mainstream.
Centralized decentralized finance is getting organized with the launch of a new alliance that aims to bring the concept of CeDeFi into the mainstream.
The CeDeFi Alliance, announced today, is a new initiative led by smart exchange ecosystem Unizen and the crypto venture capital firm Jun Capital and has the ambitious goal of marrying centralized finance with the emerging world of decentralized finance apps.
For the uninitiated, CeDeFi refers to the combination of CeFi and DeFi and aims to bring the benefits of greater regulation, more transparency and compliance to DeFi apps.
Proponents of CeDeFi say it will enable the creation of a new breed of credit protocols, decentralized exchange platforms and liquidity aggregators that will benefit from lower transaction fees and faster speeds while satisfying the regulatory standards of traditional institutions. In addition, CeDeFi will also help address one of the main obstacles that dissuade enterprises from crypto use cases – namely, the lack of compliance within the industry in its present, decentralized state.
The CeDeFi Alliance hopes its efforts will ultimately convince traditional players in the financial world to embrace blockchain, using smart contract capabilities to power more innovative and accessible new products and services.
The belief is that advocates of CeFi and DeFi, who have traditionally been sworn opponents opposed to one another, can find some common ground and explore ways to cooperate for their mutual benefit. If they can do so, Unizen said blockchain and crypto technologies can potentially disrupt multiple industries beyond the financial world it’s initially targeting.
Unizen brings a lot of practical experience to the Alliance as the company behind the immensely popular Uniswap exchange, which merges numerous CEX and DEX platforms. It enables institutional traders to discover more favourable trades and increase their bottom lines while enjoying the benefit of lower fees and a secure exchange environment.
While Unizen has the technical nous, Jun Capital possesses the organizational capabilities and the capital required to get CeDeFi off the ground. The two organizations have previously collaborated to form the ZenX Incubator, which is currently incubating the development of several early-stage CeDeFi projects. Those projects are making good progress on the practical aspects of CeDeFi, Unizen said but can benefit from the creation of robust theoretical and regulatory frameworks. That’s what the CeDeFi Alliance will initially focus on.
Besides its regulatory work, the Alliance will also work to promote the benefits of CeDeFi to governments and traditional players in the finance industry while building up a network of partners to foster more comprehensive collaboration.