Pantera Capital CEO on Why Investing in DeFi Is a ‘Really, Really Asymmetric Trade’


Dan Morehead, CEO and Co-CIO of crypto investment firm Pantera Capital, talked about why he is so bullish on decentralized finance (DeFi) during an interview with Real Vision CEO Raoul Pal at the SALT New York 2022 conference.

On September 12, according to a report by The Daily Hodl, Morehead had this to say about how he believes Bitcoin will perform vs altcoins in the future:

Obviously, there was a time [BTC] was the only blockchain so it was 100% of the industry. And then as more and more interesting use cases come out, I think Bitcoin dominance, or its share of the overall market, is in a long-term secular decline while it’s going up 10x... I think Bitcoin’s going to go up a ton. It’s just other things I think would go up more...

It’s kind of like in the tech space. Twenty years ago, Microsoft was kind of the whole industry. And since then, it’s gone up 10x, which is amazing, you know great return, but other things Apple, Google, Facebook, whatever, have gone up even more, and so I think that’s my analogy for the blockchain space.




As for DeFi, the Pantera Capital CEO said:

All of DeFi is only worth $20 billion today. And traditional finance is worth $3 trillion. I wouldn’t bet all my life savings that DeFi is going to work or be great or whatever. But when you have that kind of leverage, it’s less than 1% of the value of traditional finance, that I think it is really, really asymmetric trade.

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Morehead remains confident in the long-term potential of blockchain technology, even though the market may not be feeling this way at present, and according to a report by Cointelegraph, during an interview with Real Vision on September 23, he said:

Like any disruptive thing, like Apple or Amazon stock, there are short periods of time where it’s correlated with the S&P 500 or whatever risk metric you want to use. But over the last 20 years, it’s done its own thing. And that’s what I think will happen with blockchain over the next ten years or whatever, it’s going to do its own thing based on its own fundamentals...

We’ve been very focused on DeFi the last few years, it’s building a parallel financial system. Gaming is coming online now and we have a couple hundred million people using blockchain. There’s a lot of really cool gaming projects, and there still are a lot of opportunities in the scalability sector.

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