Andre Cronje Wikipedia
Andre Cronje is a South African software developer and crypto-currency/DeFi (decentralized finance) entrepreneur who is best known as the founder of Yearn Finance.
Cronje initially gravitated toward the field because his then-roommate needed rides to college classes in the early 2000s. Though Cronje was working as a lawyer at the time, he found himself increasingly interested in the material and ended up taking the classes himself. His talent was apparent, and in just a few short years, he was a lecturer educating other students in the field.
Over the next decade, he took on a variety of tech roles, bringing his skill set to telecom, neural networks and finally fintech. In 2016, during a chance lull in his work — one owing to his business partner’s absence for a honeymoon — he grew interested in blockchain. Previously a code reviewer and partner at Crypto Briefing, he’s also worked as a technical adviser for the Fantom Foundation.
Though he was a known element well prior to Yearn, Cronje rose to widespread prominence on the back of the first yield vault project: Yearn.finance.
What started as a personal project to automate decentralized finance yield generation became a near-mythic institution following Yearn’s July “fair launch” in which all YFI governance tokens were distributed to liquidity providers, with none reserved for the founding team. While Cronje has since labeled such a distribution method a “mistake,” it brought the founder cult-like levels of adoration and earned him comparisons to Bitcoin founder Satoshi Nakamoto.
Andre Cronje Net Worth
There is no credible information about Andre Cronje’s net worth online. However, a number of stats pertaining to his projects are known.
Although Cronje released YFI as a “completely valueless 0 supply token”, its price increased by 35,000% within a week after appearing on Hayden Adams’ Uniswap platform.
As of December 2021, there was $650 million worth of crypto assets staked in Yearn, according to CoinDesk.
However, in late September — arguably at the peak of Cronje’s popularity — $15 million was taken from a bonding curve contract for Eminence, an unreleased nonfungible-token gaming project Cronje had been developing. Though the project was weeks away from production, on-chain sleuths discovered the associated contracts and piled in. The lost funds led to tension between a community that had once adored and perhaps blindly trusted Cronje and a development-focused founder who was implicitly being asked to make thousands of investors rich.
Andre Cronje in News
OLAF CARLSON-WEE rode 2017’s “initial coin offering” craze to become one of crypto’s top venture investors. Now he’s raking in hundreds of millions, from a blockchain rage called DeFi, which promotes the fantasy of democratized financial services.
On a frigid, windy day in January, Olaf Carlson-Wee is settling in for a long Zoom call from his $10 million Soho loft in Manhattan, reflecting on how far he has come in the four and a half years since Forbes featured him on its cover, labeling him the poster child for the cryptocurrency bubble of 2017.
Back then, a speculative frenzy of hundreds of initial coin offerings (ICOs) pushed the cryptocurrency market to well over $100 billion in value as greedy fools bid up junk tokens backed by little more than a white paper and some quirky computer code. Then 27, with three years of Coinbase work experience under his belt, Carlson-Wee was considered a sage. He had started a San Francisco–based hedge fund called Polychain Capital that was backed by Andreessen Horowitz, Union Square Ventures and Sequoia Capital, and his fund’s assets had swollen from $4 million in September 2016 to $200 million.
Today, despite recent turbulence that saw bitcoin and other cryptocurrencies fall 30% to 50% in a matter of weeks, the market for them is still close to $2 trillion, and Polychain’s assets are $5 billion—up 125,000% since inception. Carlson-Wee just closed a $750 million raise for his third venture fund, led by Tiger Global Management and Singapore’s Temasek Holdings, two of the smartest and most successful investment firms on the planet.
“We had a lot of interest. Many, many hundreds of millions in demand more than we raised,” boasts Carlson-Wee, now 32, clad in a lime-green tie-dyed T-shirt, running his fingers through his spiky, bleached blond hair.
“Whatever the ideal, in practice, DeFi is a speculator’s paradise…Even after crypto’s recent correction, the amount at risk stands at nearly $80 billion.”
Carlson-Wee’s net worth has grown to an estimated $600 million because among crypto investors, he has an uncanny knack for deftly navigating a market chronically infected by hyperbole and assets without any discernible intrinsic value. Among the most profitable of his early investments was a major stake in ether, the token underpinning the Ethereum blockchain—now worth $2,700, but trading for less than $12 back in 2016 when Carlson-Wee’s Polychain went all in.
He is not shy about his new riches, quite literally created from ether. His 6,000-square-foot Soho digs, which he recently bought fully furnished, was once an art gallery owned by prominent NYC collectors. Its opulent interior design, described by its realtor as lower Manhattan’s “most Instagram-worthy” residence, was inspired by the luxury Hôtel Costes in Paris and features tin ceilings, gold columns, a cobra-shaped snakeskin chair and chandeliers fashioned from organ pipes and crystal. Its master bathroom is a study in gold, including a mirrored ceiling and a shimmering gold-plated bathtub with a large dollar sign hanging on the wall above it. A few months before he bought this New York party palace, when bitcoin was trading above $50,000, he closed on another trophy property in the Hollywood Hills. That $28.5 million, 12,000-square-foot mansion has breathtaking ocean and Los Angeles skyline views, an indoor pond, infinity pool, seven bedrooms and spaces for ten cars.
One of the keys to Carlson-Wee’s success has simply been being early. He met Ethereum founder Vitalik Buterin, for example, when the then-19-year-old briefly worked at Coinbase in 2013. That was just before Buterin wrote his revolutionary blockchain white paper, which one-upped bitcoin by creating a multipurpose computing platform based on so-called “smart contracts.” These agreements have no conventional legal standing, but because the terms are blindly enforced by computers, they are more immutable. Without smart contracts there could be no ICOs or NFTs.
Olaf Carson-WeeGUERIN BLASK FOR FORBES
In 2018, at the Web 3.0 conference in Berlin, Carlson-Wee met MIT research scientist Harry Halpin—the co-creator of a super-privacy protocol called Nym. Halpin was frustrated by traditional VCs’ reluctance to back him. Says Halpin, “This smartly dressed young fella came up to me and said, ‘We at Polychain are interested in funding subversive technology.’ ” Polychain led a $6.5 million round for Nym last July, just before the startup hired Chelsea Manning.
“I like being the first person to believe in someone,” says Carlson-Wee, just back from spending his New Year holiday with a dozen friends in a house he rented in St. Barts. “Our goal is to invest in breakthrough technologies that will enable new types of human organization and behavior.”
Polychain’s most ambitious investment foray to date has been its backing of a phenomenon known as decentralized finance, or DeFi, which uses blockchain technology in peer-to-peer applications. The promise is that DeFi could eventually become a cheaper, more private, secure and accessible replacement for traditional financial institutions, including banks and exchanges. Carlson-Wee was an early investor in DeFi’s biggest winners, such as Uniswap, an exchange; lender Compound; MakerDAO, a lender and stablecoin creator; and DeFi exchange aggregator dYdX. Blockchain-traded DeFi tokens have had eye-popping returns. The total market now amounts to $78 billion, up from $10 billion in January 2020.
Crypto idealists, including Carlson-Wee, believe DeFi is the future of finance, and just the thing to level off a lopsided financial playing field. For centuries middlemen bankers—from the Medicis of Florence to JPMorgan’s Jamie Dimon—have wielded great power and amassed huge fortunes. DeFi aims to cut them out.
All DeFi functions—payments, savings, trading, lending—are conducted on blockchain-based software. Changes are made by token holder vote. There is no central control.
Carlson-Wee’s success lies not only in his ability to find the most promising DeFi startups but in Polychain’s willingness to make outsize investments in them. Decentralization and democratization may be the DeFi ideal, but when it comes to decisions that might affect Polychain’s returns, Carlson-Wee is very much in charge. He doesn’t hesitate to use his firm’s formidable voting power to ensure that the interests of his partners come first.
“I’m very much a pragmatist,” he admits. “I don’t think crypto fixes wealth inequality or wealth concentration, but it does shake the snow globe.”
Olaf Carson-WeeGUERIN BLASK FOR FORBES
OLAF CARLSON-WEE’S crypto journey started in 2011, the summer after his junior year at Vassar College in upstate New York. An avid fan of role-playing video games, he had read about how the underground drug marketplace Silk Road was enabled by a virtual currency called bitcoin. His excitement over the new tech drove him to sink almost his entire life savings—about $700—into bitcoin at prices ranging from $2 to $16. He went on to write his senior thesis in sociology on the emerging cryptocurrency.
After graduating in 2012 and spending a few months working as a lumberjack while living in a yurt on a commune in Washington State, he blindly emailed his thesis to the Brian Armstrong and Fred Ehrsam, the cofounders of budding crypto exchange Coinbase. They hired him as their first employee and put him in charge of customer service. Carlson-Wee famously insisted that his entire $50,000 salary be paid in bitcoin.
Though he had little coding experience, he helped automate many of Coinbase’s routine customer-service responses. He was eventually put in charge of risk and lowered Coinbase’s fraud rate by 75%.
Early in his crypto career, Carlson-Wee says, he realized that entrepreneurs with a strong vision for the future were funded and rewarded most, rather than those who were reactive or fast followers.
“Coinbase had the architecture of a central custodian. It was very contrarian in crypto at the time. It was taking on the compliance and antifraud burdens of accepting bank payments,” he says. “This was something nobody had really been able to do.”
But as Coinbase expanded and became more mainstream, it was forced to pay greater attention to regulatory demands. It began to intentionally steer clear of crypto’s bleeding edge, where Carlson- Wee felt the most potential lay. He was most excited about Buterin’s new Ethereum blockchain, which unlike bitcoin could (theoretically) run virtually any type of digital platform, making possible decentralized versions of Uber, Facebook, Google or Dropbox.
Former Coinbase colleague Adam White, recently president of crypto wallet Bakkt, believes that as Coinbase added dozens of software engineers from top schools, Carlson-Wee had become pigeonholed as the “operations guy.”
“I started to realize that Olaf was more than just the guy who was going to work hard and answer [customer] support tickets,” says White, who recalls a holiday party in 2014 at which Carlson-Wee casually told him that bitcoin would never trade as low as $300 again.
In 2016, Carlson-Wee informed Armstrong and Ehrsam that he was quitting to form a crypto hedge fund. “I realized that [Coinbase] was going to broadly follow its path with or without me,” he says. “By founding something, I could regain that feeling of super-high leverage.”
LEVERAGE HAPPENS to be the fuel powering the current DeFi boom. From a capital-raising standpoint, DeFi is the successor to initial coin offerings. Most of the ICOs of 2016 and 2017 were junky digital IPOs in which speculators traded ether tokens to invest in hundreds of questionable projects. The majority were worse than even the shoddiest stocks. There was almost no disclosure, and investors had no real equity or voting power. Billions were lost.
DeFi is touted as an improvement because investors in these Ethereum-based platforms are merely lending their capital, usually in the form of ether or a stablecoin like USD Coin, to others in peer-to-peer networks. The rules are set out in smart contracts embedded in the Ethereum blockchain. By lending crypto, DeFi investors can make money—lots of it— through something called yield farming.
It works like this: Say you own $10,000 worth of ether. Rather than having it sit in your digital wallet on Coinbase earning zero interest, you could deposit it in a DeFi platform like Compound, making it available for somebody else to borrow for a set time. In exchange you’ll earn an annual yield as high as 30%. But that’s not all. You’ll also be rewarded with Compound’s own tokens, COMP, the platform’s native asset, which entitles you to vote and have a say in governing the network. COMP tokens also trade actively. Between their launch in June 2020 and mid-2021, they skyrocketed in value from about $65 each to more than $800. Even after the recent crypto crash they’re up about 90% since release.
“You can now have lending agreements for millions of dollars between two people around the world who don’t know each other’s identities,” says Carlson- Wee, whose 2018 $2 million investment in Compound led its seed round at a $22 million valuation. Compound released its token in June 2020. Its market cap soared to $4 billion in 2021 and now hovers around $800 million.
“These loans can be an agreement between a person and a computer, or a corporation and a computer. There’s no concept of identity or legal contract. And yet [because of smart contracts] you can have literally billions of dollars [move] between these people,” Carlson-Wee says.
Whatever the ideal, in practice, DeFi is a speculator’s paradise. The COMP tokens you’re awarded for lending out your ether on Compound can then be deposited in any number of decentralized exchanges such as Uniswap (also a Polychain holding), where you can likewise earn interest and more free tokens. On Uniswap you earn UNIs. Then you can deposit your UNIs on SushiSwap and earn SUSHI. And so on.
It can seem like a self-perpetuating bubble. Over the last 12 months, DeFi platforms including Uniswap and SushiSwap have averaged over $50 billion in transaction volume per month, but there’s little evidence that any of this goes toward the things banks typically finance—say, company expansion or even buying a home.
“Polychain is among a handful of big hedge funds and VCs including Paradigm, Bain Capital Ventures and Pantera, which, behind the scenes, centrally control many of the biggest decentralized platforms.”
Things don’t always go smoothly, either. Chainalysis estimates that in 2021, 72% of $3.2 billion in crypto assets stolen came from DeFi sites. In early 2020, when the emerging pandemic caused markets to plummet, investors in a Polychain-backed DeFi platform called MakerDAO suffered $8 million in losses when its underlying software liquidated 1,200 collateral positions in response to a 55% drop in the price of ether. At one point the foundation that runs MakerDAO considered an emergency shutdown. The platform was saved in part because ether rebounded 80% in a few months. Much more is at risk now. In March 2020 the total value of digital assets “locked up” in DeFi platforms was about $10 billion; today, even after crypto’s recent correction, the amount at risk stands at nearly $80 billion. Little wonder that powerful opponents, such as Massachusetts Senator Elizabeth Warren, have called DeFi “the most dangerous part of the crypto world.”
IF THE NEW WORLD of decentralized finance is a democracy, then Olaf Carlson- Wee is a Tammany Hall boss. With large stakes in the biggest platforms including Compound, Uniswap and MakerDAO, Polychain’s analysts are actively involved in creating their architecture, known as “tokenomics,” as well as designing the incentive mechanisms that attract investors.
When it comes to Compound’s governance, for example, Polychain is the second-most-powerful voting bloc behind Andreessen Horowitz. It controls 306,000 of 2.8 million votes, roughly 11%. Andreessen has 321,000. Important votes on things like lowering loan collateral requirements require that only 400,000 votes be cast, so, as long as they agree, the venture firms can easily sway any vote their way. In fact, Polychain is among a handful of big hedge funds and VCs including Paradigm, Bain Capital Ventures and Pantera, which, behind the scenes, centrally control many of the biggest decentralized platforms.
Unlike voting for common stocks, there is no mandate to notify token holders of upcoming votes, and for those who store their DeFi tokens on exchanges like Coinbase there isn’t even a mechanism to allow voting.
“A decision does not pass on Uniswap, Aave or Compound unless it is approved by the founding team,” says Andre Cronje, founder of Yearn.Finance, a yield farming robo-advisor. Carlson-Wee openly admits that his team works with founders on all major proposals. Adds Cronje, “As much as there is talk of decentralization, unless it is back-channeled there will be no approval.”
Carlson-Wee prefers not to dwell on DeFi’s inherent contradictions. “I’ve never really viewed decentralization as an end goal or a feature that users want,” he says. “What people really want are security guarantees. And decentralization is usually the best way to get them.”
These days, he’s focused mostly on where to deploy his $750 million in fresh capital. Polychain takes a thematic approach to investing in early-stage startups (see table, page 65), something that the youthful money man says he gleaned from VC veteran Fred Wilson, of Union Square Ventures.
In the fast-moving cryptoverse, DeFi is yesterday’s bubble. NFTs and the metaverse are the next wave of froth Carlson- Wee wants to surf. “The internet generation cares about avatars and profile pictures more than clothing and cars. As we transition to digital lifestyles and, eventually, a fully internet-native metaverse, NFTs become the artifacts all around us,” he says, a glint in his blue eyes. “Imagine a game world where the price of a token going up would actually expand the size of the game.” MORE FROM FORBES MORE FROM FORBESDAOs Aren’t A Fad – They’re A PlatformBy Jeff Kauflin MORE FROM FORBESForbes Blockchain 50 2022By Michael del Castillo MORE FROM FORBESFive Social Networks Defending Against Blockchain DisruptionBy Nina Bambysheva MORE FROM FORBES2022 Forbes Blockchain 50: A Closer LookBy Javier Paz
Sowmay And Samyak Jain: Disrupting The Crypto Ecosystem With DeFi
Sowmay Jain, Samyak Jain, Co-founders, InstadappSowmay Jain, 24Samyak Jain, 22Co-founders, Instadapp
Samyak Jain, 22, a computer science student who hails from Rajasthan’s Kota district, dropped out of college in the second year to pursue his passion for building a decentralised finance (DeFi) protocol. His elder brother, Sowmay, 24, who aspired to become a chartered accountant, did the same. The brothers were interested in the world of cryptocurrency and decided to delve into it.That same year, in August 2018, they won the ETHIndia hackathon in Bengaluru. It was a turning point for them as Instadapp, the platform they built for the competition, grabbed eyeballs. The blockchain-based finance platform allows people to lend and borrow funds from others or even earn interest in savings-like accounts. “There was no looking back. We received a lot of recognition and traction from the community. We were also given a grant by Kyber Network, which is a multi-chain crypto trading and liquidity hub based out of Singapore. By November 2018, we launched our platform in the market,” says Sowmay.
The startup bridges the gap between various projects by creating a “middleware” layer that allows developers to build applications that are compatible between DeFi protocols and crypto payment gateways. “Right now, fintech is a central power and nothing is connected properly. For instance, if you want to move your loan from HDFC Bank account to your ICICI Bank account, you can’t do it easily, but with Instadapp you can move from one protocol to another with just one single tap. So it’s connecting all the financial things together,” explains Samyak.
The company has raised two rounds of funding: $2.4 million from prominent crypto investors like Pantera Capital, Naval Ravikant and Balaji Srinivasan among others in September 2019 and a second round led by Standard Crypto which also included Andre Cronje, the founder of Yearn.Finance, a crypto investing platform. “The funding gave us a lot of boost, especially in convincing our parents who used to insist on us getting a real job,” says Sowmay.
Their revenue model is to charge fees on financial volumes and lending/borrowing activities taking place on the platform. “We have users from across the globe. Though due to regulatory issues we have fewer users from India, most of the backend development work happens in India,” says Sowmay.
Instadapp is the fifth largest entity in the DeFi space worldwide, with assets worth $10.16 billion circulated in smart contracts on the blockchain, according to DeFi-Pulse, an analytics and ranking platform. The company launched its INST governance tokens in June 2021, which put the Instadapp protocol under the control of the community.
“We saw so much potential in Sowmay and Samyak in building a beautiful product that would simplify users getting access to DeFi and developers building applications for DeFi. We were already happy users of the product and it was a Top 3 decentralised application in terms of traction,” says Paul Veradittakit, partner at Pantera and also one of the first investors of Instadapp.
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(This story appears in the 11 February, 2022 issue of Forbes India. To visit our Archives, click here.)
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One Day After Launch, OpenSea Competitor LooksRare Sells Over $100M In NFTs
After months of speculation about a possible vampire attack, dominant NFT marketplace OpenSea may finally have a worthy – and more thoroughly decentralized – competitor: LooksRare.
According to a Dune Analytics dashboard, in the past 24 hours the fledgling non-fungible token marketplace has hosted $105 million in trading volume, generating 613 ETH (nearly $2 million) in platform fees to be distributed to LOOKS token stakers in the coming hours, according to pseudonymous co-founder Zodd:
OpenSea, meanwhile – the dominant force in NFTs, often commanding in excess of 90% of the sector’s total trading volume – saw $169 million in volume on Monday and is narrowly keeping pace with LooksRare on Tuesday, also with $105 million in sales.
So far, traders are betting LooksRare has at least temporary staying power. Over 75,000 Ethereum addresses have claimed a LOOKS airdrop worth an average of $3,500, and the token is on the precipice of breaking the top 200 cryptocurrencies by market cap, up 38% on the day to $3.58.
The numbers point to a searing-hot start for a day-old platform that seems to fill a clear market demand. For months, NFT traders have clamored for OpenSea to release a token and decentralize portions of its operations. The incumbent’s policies around enforcing IP as well as delisting hacked or exploited NFTs has made it a target of critics who say it’s a rent-seeking middleman in a decentralized ecosystem. The firm was recently valued at $13.3 billion.
Read more: NFT Marketplace OpenSea Valued at $13.3B in $300M Funding Round
Looking past the flashy numbers, however, there may be signs that LooksRare’s surge could soon ebb – specifically, that a large portion of its remarkable volume is attributable to traders “wash trading” in order to farm platform token rewards.
The question is: Will traders return to OpenSea if token incentives can’t keep them around?Favorable conditions
In many ways, LooksRare had the good fortune of launching at an unusually opportune time.
OpenSea has recently been a popular punching bag for critics, both within and without the crypto community. For months ideologically motivated users have griped about 2.5% platform fees routed to OpenSea’s team rather than to users, the lack of a token and about the marketplace’s at times patchwork enforcement of intellectual property claims.
Additionally, OpenSea’s opaque policies around delisting hacked or exploit items has become a target for critics of Web 3, such as Signal founder Moxie Marlinspike, who argue that the emerging technological movement’s claims to decentralization are undermined by reliance on centralized third parties.
Read more: Is Moxie Marlinspike Right About Web 3?
These conditions prompted observers to ponder whether a competitor could take OpenSea’s crown via a “vampire attack” multiple times over the past year – a term for an effort to sap volume from an incumbent protocol via superior incentives often seen in decentralized finance (DeFi). Previous efforts, such as prolific developer Andre Cronje’s open-source Artion marketplace, have largely failed to put a dent in the multibillion-dollar NFT behemoth, however.
In addition to the narrative tailwinds supporting a push from a decentralized alternative like LooksRare, market conditions also currently favor the platform’s launch.
Amid a broader crypto market rout, NFTs are showing impressive signs of strength, mirroring a 2021 June-through-August summer dip that saw Ethereum pull back as much as 50% while NFTs reached the peak of their mania.
Indeed, according to a Dune Analytics dashboard, December was the highest sales volume month for OpenSea since August, and “floor prices,” or the lowest price at which a NFT from a collection can be bought, have rebounded for major collections like CryptoPunks, which are up nearly 20% off November lows.Wash trading?
While conditions appear right for the platform’s launch, LooksRare’s early success isn’t entirely attributable to natural demand.
As multiple observers have pointed out, a large portion of LooksRare’s volume is likely being generated from wash trading, which refers to the practice of wallets typically controlled by the same party “selling” assets back and forth.
Read more: Andre Cronje’s New NFT Marketplace Is a Vampire Attack Suicide Pact
Currently, the protocol is rewarding buyers and sellers with 2,866,500 LOOKS tokens (over $10 million) per day based on volumes traded and will continue to do so for the next 30 days before progressively cutting emissions, according to the documentation.
Collections without royalty fees, such as Larva Labs’ Meebits, are among the most popular, with many “floor” Meebits generally worth 3.5 ETH or lower trading for as much as 30 ETH.
However, the team has warned that attempting to game the rewards in this manner could quickly turn unprofitable because the 2% platform fee incurred during wash trades may outstrip rewards earned.
“Each trade on LooksRare (except for private sales) incurs a platform fee of 2%, and typically a royalty fee of between 5%-10%. The total LOOKS rewards for trading each day are also fixed, and distributed based on traders’ contribution to total trading volume, meaning that there’s no guarantee of the amount of rewards that a wash trader could earn in a day,” reads the documentation.
As with many “liquidity mining” schemes, where platforms reward users for providing liquidity and activity, it remains to be seen whether LooksRare’s volume will remain sticky as the LOOKS rewards spigot turns to a trickle in the coming months.