Block Earner, an Australian fintech company, says the downfall of Terra Luna in May resulted in “positive surprises” for his company as investors began looking for a path to the lower risk products they offer.
Speaking to Cryptooshala, the company’s general manager, Apoorva Chiranevala, said the company is facing an influx of investors who were previously aiming for double-digit returns but now want a “less risky version” of those returns.
“Given that the risks to these returns have increased significantly, these guys have actually started interacting with us because we look like a less risky double-digit version of these products.”
Prior to their collapse, crypto lending platforms such as Celsius and Anchor Protocol offered up to 20% annual percentage yield (APY) for users who locked their digital assets with them.
Block Earner is a fintech company powered by blockchain that provides access to income generating products related to cryptocurrencies. However, Ciranewala explained that the platform is for those who want to access the cryptocurrency markets but have a lower risk appetite.
Its Gold Earner and USD Earner products are currently generating single digit returns.
Data provided by Block Earner Cryptooshala shows that the Terra Luna fiasco coincided with an increase in withdrawals in early May and again in mid-June due to a drop in Celsius temperatures. Since then, however, there has been a steady return to normal levels.
Australian dollar (AUD) cash deposits also remained stable between April and July, while the company’s user base increased by an average of 15% from the previous month.
Chiranewala also said that he has seen “high interest” from institutional investors over the past few weeks, including hedge funds, venture capital (VC), and pension funds (pension funds).
“Now we are almost forced to create institutional products at the same time, because the interest in this space is huge.”
“There are venture capitalists with treasuries, there are hedge funds, there are private funds. […]and then there are the super funds, which have the mandate to have a very small portion of the portfolio deployed into high-yielding assets,” he added.
Redefining Finance: DeFi Downturn Deepens, But Revenue Protocols Can Thrive
Ciranewala acknowledges that the company is not entirely immune to the downturn in the cryptocurrency markets. Block Earner had to cut its marketing spend to acquire users.
“In the environment we are in right now, it makes very little sense for us to sell and acquire users. So we stopped, we actually dropped our marketing strategy a lot.”
“Naturally, you see a slightly softer growth trajectory as opposed to the steeper curve that goes up every week,” he said.
Earlier this month, a report from Coingecko stated that decentralized finance (DeFi) market capitalization fell 74.6% from $142 million to $36 million in the second quarter, largely due to the collapse of Terra and its TerraUSD Classic (USTC) stablecoin. ) in May.
Credit : cointelegraph.com