DeFi set for ‘major resurgence,’ according to Boris Revsin of Tribe Capital

DeFi set for 'major resurgence,' according to Boris Revsin of Tribe Capital

The Resurgence of DeFi: A Path to a $10 Trillion Industry

Decentralized finance (DeFi) projects experienced unprecedented growth in the summer of 2020, fueled by significant venture capital funding and peaking at a total value locked of $248.84 billion by the following fall. However, the industry faced challenges in the form of scandals and hacks, leading to a decline. Can DeFi now recover and reclaim its former glory?

According to Boris Revsin, managing partner of Tribe Capital, a prominent investment firm with over $1.6 billion in assets under management, the answer is yes. Revsin believes that as more infrastructure is developed in open markets outside the U.S., the stage is set for a major resurgence of DeFi. He anticipates this resurgence to occur towards the end of this year or early next year.

Revsin predicts that the first wave of DeFi regulation in the U.S. later this year will push projects to explore more open jurisdictions like Dubai and Singapore. However, he also expects infrastructure projects such as layer 1 and layer 2 blockchains and rollup technology to continue flourishing in the U.S.

To Revsin, new and robust infrastructure, along with the developers driving these projects, are essential in transforming the crypto industry into a $10 trillion market. Currently, the global cryptocurrency market capitalization stands at about $1.22 trillion. The path to reaching this ambitious goal lies in the hands of the builders and innovators shaping the future of blockchain technology.

The Journey to Tribe Capital

Boris Revsin’s journey began at a young age when his parents arrived in the U.S. as Jewish refugees from Russia. Growing up in a computer science household, Revsin embarked on a path in the same field, studying at the University of Massachusetts Amherst. However, he ultimately dropped out to work as a programmer for Mitt Romney’s first presidential campaign in 2008.

Revsin went on to co-found several successful ventures, including gamified marketing firm Dailybreak, VentureApp (predecessor to tenant engagement platform HqO), and Game Theory Group, an investment firm that supported early-stage blockchain companies. With these experiences under his belt, Revsin joined Republic Capital, an arm of the crowdfunding platform Republic, where he played a pivotal role in raising over $600 million, managing assets of around $1 billion, and investing in more than 80 startups.

Having gained extensive experience and standing in the crypto ecosystem, Revsin joined Tribe Capital as a managing partner. He oversees the Tribe Crypto Fund I, which manages $96 million in early-stage investments and incubation projects, as well as participating in the firm’s approximately $400 million in equity investments.

Selecting Investments with Quantitative Precision

Tribe Capital, founded in 2018 by Arjun Sethi, Jonathan Hsu, and Ted Maidenberg, follows a data scientist-driven quantitative approach to evaluate startups. When considering potential investments, Tribe requires comprehensive quantitative data from startups, which is analyzed through their proprietary framework. This analysis generates a detailed 60-page report, providing key metrics and insights for investors.

Tribe primarily focuses on investments ranging from Series A to Series D, targeting more established but still growing companies. Additionally, the firm operates a pre-seed incubator, supporting startups in their earliest stages of development. Tribe aims to lead or co-lead investment rounds, with individual contributions ranging from $500,000 to $5-7 million.

Revsin highlights that Tribe’s strength lies in offering operational support and go-to-market advice for portfolio companies. Additionally, they provide quantitative data on the performance of protocols and their competitors.

Infrastructure as the Key to Future Growth

Tribe Capital’s investment strategy centers around “products and protocols that become part of the developer stack.” The availability of comprehensive developer tools plays a crucial role in driving projects and enticing Web2 users to migrate to Web3.

Developers face multiple infrastructure decisions, including choosing developer tools, layer 1 and 2 blockchains, and oracle data solutions. Revsin emphasizes that developer adoption generates a sustainable revenue stream for infrastructure projects. These projects can then reinvest their capital to enhance their products, attracting more developers to the blockchain space.

Revsin envisions the next six years as a transformative period in which a massive developer community will propel the industry towards its $10 trillion target. In this evolving landscape, builders and developers hold the key to creating a flourishing and resilient blockchain ecosystem.

In conclusion, despite facing setbacks, the DeFi industry is poised for a resurgence. With the development of new infrastructure and the continued ingenuity of builders and developers, the future holds the potential for the blockchain industry to reach unprecedented heights. As Boris Revsin aptly describes, the global cryptocurrency market’s current valuation is just the tip of the iceberg, concealing the immense possibilities that lie beneath the surface of DeFi.

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