Decentralized Cryptocurrency Mutual Funds Are Here! (Medium blog article)
TLDR at bottom.
Hope I am conforming to the core principals of the sub and hoping this does not come across as shilling. I honestly like the project and think its one that is actually doing what many DeFi projects are only talking about and planning.
Anyway, here it is.
If you Google the term “What is a mutual fund?” you won't find any description or answer that uses the words ‘cryptocurrency’ or ‘decentralized’.
That’s because it’s never existed before.
Welcome to the new era of decentralized mutual funds!
What Unifund does is allow cryptocurrency investors, be they the clever and wealthy kind or the kind that plays video games in basements', to invest in the cryptocurrency market, specifically and currently the Uniswap market via their decentralized mutual fund app.
These mutual funds or as Unifund like to call them ‘social trade groups’ are managed by other users, any other user, via the DApp (which is essentially a type of two-sided marketplace).
Investors invest by connecting their wallet to the Unifund app, browsing the open mutual funds available (a very user-friendly menu tab IMO), making a selection, adding funds, and boom!
The entire process takes less time than making toast once you know which fund you’d like to select.
86% of Cryptocurrency Traders reported that inexperience, limited capital, stressful trading environments & outrageous gas fee’s were emptying their pockets.
That quote is taken directly from the Unifund website and it doesn’t take an investigation to realize this is true. It does not matter which market you look at whether it be Forex trading, Cryptocurrency trading, or decentralized trading on Uniswap, most mom and pop traders lose.
CoinTelegraph reported ‘95% of traders lose money and fail’. Because of similar failures in more traditional markets, the mutual fund has always been a safer way to trade and invest and with more capital. But here’s the thing with mutual funds, even when you lose, they win. The fee structures ensure they win.
This is where Unifund comes in. No fees to join, no fees to manage, eliminates the trading fees and in the world of smart contracts and Uniswaps, it reduces network congestion and gas fees by consolidating trades and pooling capital.
BUT WON'T FUND MANAGERS JUST TAKE OFF WITH MY CRYPTO?
The beauty of the decentralized space that Bitcoin brought us and DeFi promises to expand is that there are many more options and hence opportunities. Unifund allows the fund manager to deposit collateral into his/her fund, this collateral acts as a type of counterparty risk. If they fail or try to pull a fast one your investment is backed to a level by their collateral.
This project is still in the very early stages, however rational optimists like myself (no room for false modesty) can see where it is going. I can see a very near future where any Joe-schmo can open an app, look at the fund managers on a board no different to how CoinMarketCap works and begin filtering through the funds and their managers by success rates, capital growth percentages, reviews, and other metrics, select their fund and ideally, turn the passive money key on.
Oh, and by the way, your “fund manager” might not even have to be human.
As with everything, do your own research (DYOR) and yes I am invested in this one.
TLDR: Decentralised fund management via DeFi Smart contract. It allows users to buy into Trade Groups where Fund Managers can trade on their behalf with pooled funds for fixed periods of time. Unifunds iFUND Token is used in an incentive system with strong tokenomics (including lock-ups, staking, and fee savings mechanisms). Transparent, auditable solution to the persistent problem of pump group exit scams. Pooled trading funds and locked-in mechanisms for equal profit sharing! Similar to Iconomi just not setup by banks and institutions.
Thoughts? Yay, nay, maybay?
UPDATE: Here is an insider look after connecting your metamask or other wallet to the app.
And here is what one random fund is doing (I literally just screenshotted this randomly from someone who queried the bot just now and it shows what is possible, key word possible, no shill)
UPDATE 2: Check these two funds out.