dailyhodl.com
Successful crypto-focused venture capitalist Arthur Cheong is thinking of a few steps the decentralized finance (DeFi) world needs to take to prevent another high-profile collapse like Terra (LUNA).
DeFiance Capital founder Cheong says the past week has been an “incredibly humbling and difficult event” even though his firm generally called the bearish direction of the market correctly.
“Personally, this has been an incredibly humbling and difficult event. We generally got the bearish direction right so been a lot more cautious but many of our assumptions are challenged and invalidated. We could have done much more as well to prevent this.”
He thinks Terra’s implosion will “set the space back by a few years” and whip up “increased and justified” regulatory scrutiny of DeFi around the world. The venture capitalist calls on the industry to act more professionally.
“I think a more comprehensive disclosure framework for DeFi should be championed so instead of a forced KYC/AML [know-your-customer/anti-money laundering] nightmare like the tradfi [traditional finance] world, we should push for maximum awareness/education before encouraging the usage/access of DeFi.”
Cheong says a more detailed, “public good” version of the Messari Disclosures Registry would go a long way towards achieving that end.
“A reputable, independent and well-managed DeFi directory with a comprehensive disclosure framework makes sense and should do a lot to alleviate the knowledge gap.”