In a press release published September 9th 2019, Exante announced the listing of its new decentralized finance altcoin index, called Defix, on NASDAQ (DEFX). This is not the first instance of big finance moving into the crypto index space. But it does represent a growing shift towards the inclusion of more altcoins in the mix, in addition to popular bitcoin-focused financial products. Not only that, but this is one of the first altcoin crypto indices that specifically tracks DeFi blockchain projects.
Who is Exante?
As a European investment service provider, brokerage house and trading platform, Exante gives its clients direct access to over 50 markets in the US, the EU and across the Asia-Pacific.
Founded in 2011 and now headquartered in Malta, the company began adding cryptocurrencies to its offerings in 2012 with the now highly acclaimed Bitcoin fund, which delivered a peak profit of 70,000%.
Exante was also one of the first companies to develop an altcoin index fund, called XAI. Interestingly, Coinbase announced their first altcoin index on the same day of this writing. But back to the XAI, it tracks six altcoins that make up 30% of the total marketcap: Ethereum, Litecoin, Monero, Zcash, Ripple and Ethereum Classic.
Since the start of 2019, the company has been busy adding additional crypto assets for their clients. Well known altcoins like BNB (Binance), DCR (DeCred) and QTUM (Qtum) have all been added to their service offering this year.
What are DeFi blockchain projects?
DeFi stands for Decentralized Finance which is a dominant niche within the cryptocurrency space. Projects that meet the definition of DeFi provide opportunities for many more people to access financial tools once relegated to the rich. The main features of a decentralized financial application include:
- They all enable community-wide self governance via algorithms and consensus mechanisms.
- There’s no central authority, board of directors, or CEO.
- DeFi projects are fueled by a native cryptocurrency that is often tradeable on markets and is used as money on the platform.
- They run on decentralized servers that are spread across the globe, offering increased security and reduced hackability.
- DeFi projects are blockchain-based, meaning they operate on open, public blockchains that are very difficult to manipulate or alter. If a project involves a private or permissioned blockchain, then the security features wane and central control is more likely.
- Decentralized finance tools and platforms open up their services to a global, digital ready audience, regardless of a person’s background or income level.
- DeFi projects use game theory and incentivization to benefit all participants in the blockchain network, as well as the network itself.
Different types of DeFi products
In the current blockchain marketplace, you’ll find a growing number of DeFi projects. Most of them are related to the following genres (though rapid innovation is also now taking place):
- Prediction markets
- Lending platforms
- Investment services and funds
- Exchanges and market makers
- Financial tools
Decentralized finance products have proliferated as one of the main use cases for cryptocurrencies. In fact, there is an entire movement that focuses on bringing high finance and lucrative investment opportunities to everyone, and not just the accredited or institutional investors.
Introducing the Defix Altcoin Index Fund
Soon, investors and consumers will have the option to invest in the Defix altcoin index. They’ll be able to do so through a fund that will bring them exposure to this burgeoning market of DeFi platforms and products. The Defix fund will be available on the EXANTE platform in Q2 2019.
The Defix index tracks decentralized financial products.
As of now those projects are:
- 20% Amoveo – A blockchain platform for prediction markets, smart contracts (for investments and insurance), and derivatives such as stable coins.
- 20% Augur – Platform for peer to peer, decentralized betting on sports, politics, etc.
- 7% Gnosis – Platform and DEX for conditional tokens. These tokens form a new asset class based on the outcomes of any future events.
- 25% Maker – A decentralized stablecoin, collateral loans, and community governance.
- 7% Numerai – Predictions platform providing hedge fund quality data, machine learning, and a decentralized hedge fund fed by predictions.
- 20% Ox – Peer to peer exchange built on Ethereum. Ox is a platform for trading gaming items, real estate, financial instruments and other newly created assets.
Weighting of the assets is by market capitalization. Exante’s team analyzed each project to assign its share in the Defix index.
Traders and investors alike can now view the performance of Defix. Platforms including TradingView and Google (as shown below) already enable access. Soon, it will be available on Yahoo Finance as well.
“Defix is the first altcoin index that reflects the dynamics of the most promising blockchain projects working in decentralized finance.” Defix Fund Homepage
To learn more about crypto indexes, be sure to read our Crypto Index Fund Beginner’s Guide. You may already be experienced with index funds. In that case, you might like setting up your own by following our article: