[ad_1]
Jack Dorsey on Thursday placed his mobile payment company Square at the center of one of the most talked about areas of innovation in finance, announcing that it would launch a platform for developers to create bitcoin-based “decentralized financing” projects.
In a Twitter thread, Dorsey said Square planned to create a “new business” with “the goal of facilitating the creation of unguarded, unauthorized and decentralized financial services,” in what would mark one of the first major projects of its kind in the nascent market. .
Decentralized finance, o DeFi, is the name given to the growing number of cryptocurrency projects attempting to build an intertwined financial system called cryptocurrency that cuts through traditional intermediaries.
Proponents say it will provide a new way to access financial services ranging from lending and negotiation to insurance and savings products.
Dorsey, who is the chief executive of Square and Twitter, said Square had “some ideas around the primitive start-up platforms we want to build.”
However, it is not clear what exactly the company would offer to potential developers or how it could be monetized. It will be called TBD, until a name is chosen.
“We will do it completely in the open. Open roadmap, open development and open source, ”Dorsey said, adding that Mike Brock, an executive who has worked on Square’s push for cryptocurrency, would lead the platform.
Private investors have supported more than 70 DeFi companies this year, and while the area continues to shrink, their value has risen in parallel with the bullish cryptocurrency market. According to the document, the assets of DeFi products have grown from about $ 2 billion a year ago to more than $ 55 billion today data by DeFi Pulse.
Freewheel space also has caught the attention of regulators, who have raised concerns about the security and accountability of projects, as well as the potential for fraud. Dan Berkovitz, commissioner of the U.S. Commodity Futures Trading Commission, has stated that many DeFi applications could be illegal.
Many DeFi projects are based on the ethereum blockchain because they can be used to create smart contracts easily, basically computer code that is automatically activated when certain conditions are met. However, Dorsey said the platform’s “main focus” would be bitcoin, the oldest and most popular blockchain.
Weekly newsletter
For the latest fintech news and opinions from FT’s worldwide correspondent network, sign up for our weekly newsletter #fintechFT
The bitcoin blockchain has historically been considered slower and less efficient than its ethereum counterpart. However, in November it will receive its first major update in several years, known as Taproot, which will facilitate the creation of smart contracts in the protocol.
Founded in 2009, Square began its life as a digital payments company, but Dorsey has noted broad ambitions for the group. Earlier this year, it acquired a majority stake in Tidal, the difficult transmission platform owned by Jay-Z, for $ 297 million, which made an unexpected entry into the music industry and put the rapper in the spotlight. square board.
TBD would be the latest in several cryptocurrency bets made by Dorsey, a fierce supporter of Bitcoin. Admission to the square more than double in 2020, in part, due to the increase in bitcoin-related transactions made on its Cash app, its peer-to-peer mobile payment facility.
[ad_2]
Source link
