The Chicago DeFi Alliance (CDA) announced that it will launch a grant program for developers of decentralized Finance projects (DeFi) this month.
The Alliance was created in April 2020 by Chicago financial companies. It includes firms Jump Trading, Cumberland DRW, CMT Digital and Volt Capital, working in the field of FINTECH. Recently, the Alliance was joined by Alameda Research, FTX, Electric Capital, Dragonfly Capital, Hashed, and Delphi Digital. The CDA was created to ensure that DeFi projects effectively interact with financial companies, traders, and OTC platforms, as well as to help decentralized startups create products tailored to the needs of liquidity providers.
Volt Capital co-founder Imran Khan and CDA partner Chao Wang said the program will last about eight weeks and will be modeled on the startup accelerator Y Combinator. CDA has already received more than 100 applications from startups in the early stages of development, but only seven projects will be selected from all the candidates. Each development team participating in the initiative will receive $120,000 in funding. This year, the CDA plans to conduct two such programs.
“Commissions are high, liquidity is low, and the user interface needs to be improved. All this may seem frivolous. But history knows many examples when successful technologies were created out of a mere trifle. DeFi has all the basic parameters to become a real alternative to the traditional financial system, ” said CDA partner Chao Wang.
However, despite the rapid development of the industry, some experts believe that the prospects for DeFi are not so bright. For example, Quantstamp CEO Richard MA is confident that security issues can hinder the further growth of DeFi. He suggests paying special attention to real-time vulnerability tracking, increasing transparency, and implementing insurance schemes. In addition, waves Association founder Alexander Ivanov believes that excessive hype around DeFi can damage the long-term development of the industry.