By Michael Scott
Cumberlands Labs recent announcement revealed the emergence of institutional-oriented decentralized finance (DeFi) startup Hashnote from incubation. As the pioneer incubatee, Hashnote launched as a decentralized platform for asset management supported by $5 million in funding.
Timely Emergence of Hashnote from Incubation
The lapse of the incubation period marks the entry of Hashnote into the league of grown-up and institutional-oriented DeFi. Hashnote is set to simplify the complexity characterizing most DeFi platforms. Besides, its launch is timely to resolve the complaint following the rampant exploitation of DeFi protocols in 2022.
Hashnote is set to utilize the know-your-customer (KYC) to avert money laundering on the protocol. In addition to the incubation that ended in July 2022, Cumberland Labs is set to inject $5 million into the protocol. The Chicago-headquartered digital assets trader announced it would participate on the Hashnote platform as the initial market maker from the holding entity DRW.
Absence of Requisite Finance Expertise Attributed to the 2022 Crypto Failures
Hashnote chief executive Leo Mizuhara admitted the robust performance of decentralized trading and lending platforms despite the widespread collapse of powerful centralized crypto operators. Nevertheless, the CEO lamented the absence of infrastructure mirroring traditional finance within the DeFi space.
The inability to replicate the big lenders made Hashnote’s TradFi easier to sell. Mizuhara laments the calamitous events witnessed across the crypto space in 2022. The failures revealed that downfalls were caused by mismanagement as the young personalities ran the show despite their apparent inexperience in financial matters.
Illustrated Expertise of Hashnote Executives
Mizuhara referenced his 12 years of experience when deputizing as the chief investment executive within the Bank of America. The executive outlined his departure from the lender to join the DRW as nurturing experience suitable to run Hashnote successfully.
Mizuhara recalls initiating the Hashnote idea to the admiration of DRW CEO Don Wilson. Mizuhara argued that Wilson intended to fund the Hashnote immediately by presenting a term sheet within a week.
Running Commodity Pool Operator Platform Clarified
The Hashnote revealed it would run operations regularized by the Commodities Futures Trading Commission (CFTC). It will run under a commodity pool operator (CPO) operating license. However, its international operations would retain the registration within the Cayman Islands Monetary Authority (CIMA). Mizuhara clarified that all funds would have KYC and be completely whitelisted.
The executive heading strategy Cumberland Labs Tama Churchouse indicated that the incubator runs as an autonomous entity headquartered within Singapore. The executive ruled out the firm as a subsidiary of Cumberland. He admitted the close business links with entities such as DRW.
Terms of Onboarding External Parties on Hashnote platform
Churchouse disclosed engaging external founders, particularly when faced with huge check investments. Doing so mandates undertaking a substantial equity position.
Churchhouse indicated that such arises whenever they ascertain the entities would provide a genuine competitive advantage to the DRW and Cumberland. The executive illustrated the deep involvement requirement for such entities would comprise expertise in market making, developing algorithmic systems and trading.
Hashnote emergence from the incubation period echoes the increased quest of web3 based startups in the digital sector. Recently Sony Network Communications confirmed partnering with Astar to incubate exceptional Web3 use cases.
Elsewhere, OnePiece Labs announced a strategic alliance with Uplandme Inc to leverage its metaverse-based super application in a Web3 incubation. The partnership would accelerate development of decentralized projects.