‘DeFi Doesn’t Protect the Individual, It Protects the System,’ Says Eden Block Founder
BeinCrypto spoke to Lior Messika, Founder of the Venture Capital Fund Eden Block. He discusses Decentralized Finance (DeFi), its present hype, and the significance of duty in monetary freedom.
There is little question that DeFi is booming. This is in no small half due to the funding flowing into the big number of initiatives.
Messika is the founder of 1 such VC. It funds initiatives at their earlier pre-seed, seed and Series A phases.
“I spent most of my life as an investor. About five years ago, I became enamored with blockchain. Then, seeing institutional exposure into the space, I understood that there was no such thing. Nobody was offering that exposure. Long story short, we started Eden Block,” he explains.
“We’ve been really focused on funding overqualified and underfunded teams within the space. We’ve been building out a very interesting practice that focuses on blockchain and crypto innovation at the very earliest stages.”
Focusing on mission infrastructure
As a part of their work, Messika explains that they started by investing in extraordinarily technical initiatives. This has laid the muse for his or her purpose of serving to construct the Web 3 decentralized world from the baseline up.
“What’s really interesting is we’ve always been infrastructure first. We’ve always been very deep students of what it’s going to take to build a truly decentralized world. What I really liked from the beginning about blockchains, about crypto, is the fact that there’s this one property that stands on top of everything else. There’s always been decentralization. Decentralization, as a property, enables you to build Web 3, enables you to break down barriers reduce friction,” he explains.
“I even tried to make the case that it’s a cultural movement. It’s something that we as a society have been understanding, and wanting to get to right. 3,000 years ago up until today, we’ve been trying to get to decentralization in various ways. So for us what has changed is just the applications that are enabled by this fundamental property by decentralization.”
The worth system bridge of DeFi
Messika expands upon the concept that people have been working in direction of this type of decentralization over time. He sees the DeFi area as being the “wild west,” as it’s generally known as. However, he believes it nonetheless holds true to the underlying worth techniques societies are constructed upon.
“I’m seeing a lot of links between the real world, what I call the real world, and Web 3. A lot of them are actually based on values and the value systems that we’ve been able to create as a society throughout decades and something that we all understand today,” he says.
However, with the middlemen controlling Web 2 in its siloed kind, he sees how folks acknowledge that the underlying dream of decentralization is just not being upheld.
“I think that even without the idea of decentralization, without the concept of blockchains and crypto, you can still get to the same fundamental understanding that there are some things that are just broken right in today’s systems.”
“Web 3 is the Wild West in the fact that there are different cultural, you could say, languages. There are different ideas and different ways of making those ideas come to come to light. But when you go back to the fundamentals of what we stand for, what are our values, and how do we want to solve the problem, it’s very much the same,” he explains.
Overcoming problems with social composability
However, Messika does acknowledge that Web 3 is at the moment virtually as siloed as Web 2.
“This is something that we’re going to have to overcome. The lack of interoperability, the lack of composability. Even things that are on value systems today are not tangible like social capital. We understand that social capital has a lot of value in Web 3. We still don’t know how to quantify it just exactly, but we do understand that those value systems are going to have to be composable across different systems, across different protocols, across different identities.”
For Messika, the “social silo” pertains to the dearth of approachability within the DeFi area. For those that aren’t degen geeks, DeFi is difficult and obscure. However, Messika explains that there isn’t any option to garner mass adoption if folks can’t perceive what is occurring.
“So I believe that the technical components of that lack of interoperability and those siloed systems are going to be solved way before the social and conversational aspects of the siloed systems occurs. We’re going to see that technically occur way earlier than we’re going to start seeing just run of the mill, everyday people, employing or leveraging or talking about DeFi in a way that makes sense. So that’s the biggest silo, the biggest walled garden, the biggest friction that I’m seeing right now,” he explains.
“I think there’s going to be a lot more to be done in terms of okay, how do leaders in the space communicate, values, communicate ideas, communicate products and vision to an entire ecosystem and not just to the 5,000 Discord members that obviously have a lot to gain from being there early.”
“Freedom without responsibility is a short tragedy”
More inclusivity and easy messaging may carry mass adoption. However, this nonetheless requires folks to take management of their funds in methods they will not be used to.
For Messika, this isn’t a downside however a profit. It locations the duty within the palms of each particular person whereas defending the system.
“A great guy, Vlad Zamfir, is a builder in the space. He once said, ‘freedom without responsibility is a short tragedy.’ And I completely agree with that because this idea of financial, personal freedom is inherently attached to the idea of responsibility,” he says.
“The great thing about decentralization is it doesn’t protect you. It protects the system. So, in my mind, DeFi protects you from everybody else who’s going to go and screw themselves over. It doesn’t protect the individual protects the system.”
“The way that I think about it is, you’re only going to be as free as you are responsible for yourself. That is the true meaning of decentralization because decentralization means individualism. I believe in the idea that there is no freedom without responsibility. There is no financial freedom without being able to be responsible for your own finances,” he says.
Acknowledging the gold rush in DeFi
However, Messika isn’t simply an optimist, which is important for those who’re on the funding facet of this new world. Instead, he acknowledges the present gold rush with out negating the area total.
“There’s definitely a gold rush. Everybody’s claiming to build something. Everybody’s airdropping something. I mean, even now, we’re funding these companies at 10s of millions of dollars based on an idea because we know that that idea is going to be fundamentally important for the space. So, these two guys or girls can get together, dream of an idea, and be valued at $50 million or more, and you’re not going to find that anywhere else, and that’s a gold rush to me at least,” he says.
For Messika, that is half and parcel of the trade in its present part. There are two sides to this spectrum. On one facet, the initiatives with worth, and on the opposite, these which are cashing in on the push with no actual substance.
“I’m not sure how long it’s gonna last. I hope it lasts as long as people would want it to be, and I hope it doesn’t hurt anybody on the way. But we’re definitely in a gold rush era, much more so than in 2016/2017 when I got into the space. It seems like it’s not slowing down, so I yeah I hope that everybody stays careful.”
In coping with the huge variety of initiatives, Messika says to look to their communities to seek out out whether or not there’s true worth.
“Community is everything. In Web 3, the community creates the community values, the community projects. So if you’re able to look at a decentralized network and say well, they’ve got a lot of usages, high volumes, and the graphics look good, but then you’ve got zero attention to the community or if you’ve got no active community, then there is no projection of future involvement.”
“If you don’t have a real community, you’ll have a very hard time valuing your network, with some of the softer intangible aspects of value. Something I’ve been finding more and more to be true is the networks that are able to curate and build communities around their value system around their mission around the core assets, which in many cases, a token or an entity or whatever, are going to go really far,” he says.
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