Sep 8, 2021
On this episode of DeFi Decoded, Andrew and Alex dig into the rapidly emerging DeFi Index fund movement and discuss how they're different from traditional ETF providers.
Many of the largest asset managers in the traditional financial world are passive ETFs and Index funds; the decentralized financial system is no different! Smart contract-based index funds have been one of the fastest growing areas within the DeFi ecosystem. Like traditional ETFs, they create value for investors by packaging multiple different crypto assets into a basket or index, enabling investors to get passive exposure to an entire sector with one click of a button. They come with a twist though; these index funds are entirely blockchain-based and rather than having a centralized asset manager in charge, there is simply an open-source software protocol and decentralized governance system.