Stellar’s Ambitious Endeavor: Multi-Billion Dollar App Set to Disrupt Trillion-Dollar Payment Market, XLM Price Outlook

• Robert Leshner, founder of DeFi lending app Compound, embarks on a new journey to launch a mutual fund built on blockchain, potentially providing crypto-rich investors with a seamless gateway to robust returns on government bonds. 
• If approved, this innovative venture could pioneer a paradigm shift in the financial world by demonstrating how real-world assets could be traced on a blockchain within a regulated framework.

Amid the increasingly intertwined landscape of cryptocurrency and conventional finance, Robert Leshner, the visionary behind decentralized finance (DeFi) flagship lending application, Compound, is blending the two worlds. Leaving the startup realm, he’s pioneering an unprecedented blockchain-based mutual fund, creatively coupling the seemingly mundane with the excitement of blockchain technology.

A New Frontier: Blockchain and Mutual Funds

Leshner and his ex-Compound Labs team have put forward a proposal for a novel project, the Superstate Trust. This entity is set to manage the Superstate Short-Term Government Bond Fund, a newly proposed mutual fund contingent on regulatory approval. The proposal has attracted $4 million in seed funding from renowned DeFi investors like ParaFi Capital, 1kx, Cumberland Ventures, and Distributed Global.

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This innovative fund would purchase short-term government debt, and investors could monitor this debt as a token on various blockchains, starting with Ethereum. However, Leshner stresses that this initial product is stripped of the usual DeFi trimmings. It merely serves to hold a share in the fund, with every shareholder required to be whitelisted, pre-approved to own the asset. While shares can be held on the blockchain, they can also be held in a traditional brokerage fund, much like any other mutual fund.

Leshner articulated the advantage this approach offers to crypto-native firms that deal exclusively with crypto infrastructure. He explained that these firms could now hold the mutual fund shares alongside their other investments, opening up access to yields on U.S. debt, which are currently outperforming DeFi yields.

Though the concept may seem ordinary, that’s precisely the point of this pioneer fund. Once approved and accepted by government regulators, it could stimulate an avalanche of new applications for real-world assets traceable on a blockchain within a regulated instrument. This could lead to unprecedented power if regulated exchanges trading multiple blockchain assets emerge in the future.

The Superstate team’s main objective is to provide an uncomplicated pathway for DeFi investors to access real-world yields. This innovative approach followed their stint running Compound Treasury, which aimed to provide regular investors access to DeFi yields. With Superstate awaiting the green light, its approval may take several months. However, previous approvals of blockchain-powered products by U.S. regulators hint at a positive outcome.

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