DeFi Startup Hashnote Becomes First Firm To Emerge From Cumberland Labs

Hashnote has become the first decentralized asset management platform from the Web3 incubator, Cumberland Labs. The firm joins a list of other projects that are part of the trend to expand the institutional adoption of the decentralized finance (DeFi) ecosystem.

A New Market Maker

Hashnote seeks to simplify the complexities associated with DeFi with its compliant features like know-your-customer (KYC) requirements. Accordingly, it received a $5 million investment from Cumberland Labs in July 2022.

Based in Chicago, Cumberland is a crypto trading firm affiliated with the diversified trading platform DRW. It will become the first among other selected groups of market markers in the industry.

Despite last year’s broad market tumble, the decentralized lending and trading business has remained robust. However, the DeFi ecosystem lacked a traditional finance-like system familiar to prominent institutional players.

As a result, introducing the Hashnote traditional finance (TradFi) offering is a welcome development, says Leo Mizuhara, CEO of Hashnote. Mizuhara added that last year’s event shows that the crypto space was ineffectively run. 

Market players were devoid of the financial expertise to navigate the tumultuous landscape. The CEO noted that he spent 12 years at the bank of America before joining DRW, where he headed the systematic options trading unit. 

Mizuhara added that he was the one who came up with the idea of developing Hashnote. He said DRW founder and CEO Don Wilson liked his idea and immediately sought to fund the project.

The Players

Hashnote is a regulated commodity pool operator (CPO) registered with the Commodities Futures Trading Commission (CFTC). As an offshore firm, Hashnote is registered with the Cayman Islands Monetary Authority (CIMA), which indicates that all the company’s funds are regulated and wholly allowed, added Mizuhara.

Cumberland Labs is a Singapore-based independent company that funds innovative Web3 startups to meet the rising demand for solutions in the decentralized finance ecosystem.

According to Hashnote’s head of strategy, Tama Churchouse, the firm is not a subsidiary of Cumberland but works closely with other entities like DRW. Furthermore, Churchouse added that they collaborate with external startup founders.

However, such startups must have a massive first check investment option for a significant stock position in companies that can add some competitive advantage to Cumberland and DRW. The executive stressed that this involves deep participation in trading and developing algorithmic systems and other necessities for the firm’s operations.

The need to close the massive gap between TradFi and DeFi has never been more urgent than now, given the explosion in the use of digital currency in the mainstream financial sector, said Churchouse. Ultimately, as prominent institutional players continue to demand innovative solutions to address the growing need to serve some select clients, initiatives like Hashnote will become more widespread.

While the crypto market may have been down following last year’s bloodbath, experts believe that demand for DeFi-based products will continue to rise in the coming months.

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