DeFi
Exponential.fi wants to make investing in DeFi easier
Exponential.fi, better known as a Cryptocurrency Risk Assessment Platformis launching a new suite of products designed to make the world of decentralized finance (DeFi) less intimidating for retail traders.
The new platform, which has been available to a small number of beta testers for a year, aims to serve as a one-stop shop for traders to identify, discover and invest in cryptocurrency opportunities.
According to Driss Benamour, CEO and co-founder of Exponential, the company started two and a half years ago when his other co-founder, Exponential Chairman Medhi Labbar, was managing a fund for his friends and family and was struggling to move their money into decentralized financial investments.
“I saw how much pain he was in,” Benamour said in an interview with CoinDesk. “He was bridging. He had this crazy spreadsheet. He was managing 12 portfolios. I thought, ‘This is crazy.’”
Exponential, which raised $14 million in a 2022 Financing Round Led by prominent crypto venture capital firm Paradigm, the new platform was designed as a hub that investors could visit to discover DeFi opportunities and assess their risks. The new platform differs from its predecessor in that it will allow users to invest directly from the app.
According to Benamour, Exponential’s new platform is “the safest and easiest way to invest in DeFi with institutional-grade security.”
Exponential will continue to focus on risk assessment, presenting detailed risk information next to each investment opportunity listed on the platform. It is also designed for retail traders who may not have experience investing in blockchain, so it offers a user interface and feature set aimed at a broad audience.
“To make this truly accessible, you have to approach it from every angle, with just one click,” Benamour said. “That means one-click trading, easy funding with crypto or fiat. That means easy portfolio management. That means easy taxes, etc. We’ve built a complete platform so that anyone can invest in DeFi and access the yield.”
“Today, there is no way, other than Exponential, to send $100 from your bank account and get into a Uniswap pool in less than 24 hours,” Benamour said. “That’s the magic of what we do.”
Exponential says it is taking a regulatory-first approach and is committed to taking a different path than the DeFi with a tragic destiny the performance platforms of yesteryear.
Exponential is registered as a money services business with the United States Financial Crimes Enforcement Network (FinCEN) and requires certain personal information from users in order to operate.
Like other platforms, it temporarily holds users’ funds before investing them on-chain, a step meant to streamline the investment process and remove network gas fees. (Exponential charges its own 20 basis points on each transaction.) However, according to Benamour, “everything is also traceable on-chain. You can see your wallet as a user on-chain, and you can see the funds moving and get receipts from smart contracts.”
Platforms like Exponential, which serve as intermediaries between banks and blockchains, are often criticized for undermining the decentralization that is supposed to be at the heart of DeFi.
“We may move to a fully decentralized platform when we can,” Labbar said, but he added: “We prioritize access, and right now the easiest way to unlock access and unlock the promise of DeFi, which is about freedom, is to introduce this layer of centralization.”