Kain Warwick, founder of Synthetix (SNX), thinks it is virtually impossible for decentralized finance (DeFi) projects to avoid regulatory risks in the US.
In July, Warwick founded Infinex, a decentralized perpetual exchange that uses Synthetix for its liquidity.
He acknowledges that there is a regulatory risk associated with the project, to argue that some US regulators are “ignoring the benefits of a transparent and open infrastructure powering financial markets.”
“[In my opinion]US regulators have completely lost sight of their mandate, and it is now up to the courts to sort it all out.
The position of US regulators is completely at odds with their mandate. DeFi is built on technology that increases market transparency and efficiency. It is not perfect, but it is very new and should be given the opportunity to prove itself in the market.
It certainly has more potential than the current system of a bunch of black boxes built on 50-year-old legacy code barely kept in line by millions of pages of rules and regulations.”
Warwick say he built Infinex because he noticed an inefficiency in the Synthetix ecosystem.
“And the best part is that no one can stop me. Same goes for other protocols, don’t like the Aave UX (user experience), go fix it and if you’re right, you can charge for fixing this inefficiency.
This is the power of DeFi: incumbents can be disrupted from within as well as without. This is impossible in TradFi (traditional finance) and innovation suffers.”
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