The chief executive of digital asset hedge fund Polychain Capital says crypto assets are poised to trigger a once-in-a-generation transfer of wealth.
In a new interview with Real Vision, Olaf Carlson-Wee says the technology that fuels Bitcoin has spawned two new asset classes at once.
He points to BTC’s use as a digital currency and the advent of the decentralized finance (DeFi) movement as a pair of transformational technologies that will have long-lasting impacts on the economy.
“We talk about the DeFi, or the decentralized finance space, where they’re sort of lending products, trading products, escrow products. These DAO-like entities can manage the parameters of those products and actually accrue revenue from the operations of those products. So for example, that DAO (decentralized autonomous organizations) might have to decide what types of assets can be used as collateral in this lending system.
That’s actually quite tricky, figuring out which types of assets are basically allowed to be used as collateral in the lending system and what the collateral requirements might be for those individual assets. And so then that DAO has what look and feel a bit like ownership shares that represent rights to manage the rules of that system, as well as govern the capital held in that system. This is not a currency the way that, say, Bitcoin is. It’s a completely new type of feeling structure. But it’s completely native to the internet, like Bitcoin…
And so to me, this really does represent a completely new way to organize humans. And when I think about both this electronic commodity assets, like a bitcoin, or these DAOs that are things like MakerDAO or Compound Finance or Uniswap. I think that we have already invented, in 10 years, two completely new asset classes using blockchains.”
Carlson-Wee says he believes the combination of Bitcoin and DeFi is set to trigger a financial revolution and wealth transfer, unlike anything the world has seen in decades.
“One of the interesting things about these blockchain-based assets is that I really do think that it’s going to end up being one of the biggest shifts and fastest changes in the system of wealth that humanity has ever seen. Because these, literally, were just invented overnight and have sort of exploded, really, over the last 10 years, I see no reason why this will stop.
I do sometimes call this like the greatest wealth transfer of our lifetimes and, really, that humanity has ever seen. And it’s going to happen very, very, very rapidly. Because when we effectively just recreate these systems of corporations or these systems of money and you actually shift and allocate the amount of money that’s in traditional corporate investments or traditional investments in commodities or gold or money systems into blockchains, it’s the opportunity of a lifetime.”