Brains of Crypto: How Team Finance is Bringing Trust & Transparency to the Crypto
Join us as we discuss Team Finance's innovative DeFi tool with liquidity locking & token vesting services. Over 32k projects have used it with $1B TVL.
Today we are joined by Zac, Team Finance’s Product Manager to discuss their innovative DeFi tool that provides liquidity locking and team token vesting services for token founders and the crypto community.
Team Finance is a token management toolkit. Founders can create their tokens, lock them, automate their vesting, and launch staking pools. It reduces the need to use several different providers for each of these services, and helps projects build trust with their investors and community.
Over 32 000 projects have already used Team Finance, with around $1 billion USD of total value locked (TVL). Team Finance is part of Trustswap - other Trustswap verticals include The Crypto App, Swappable, and Trustswap Launchpads.
We will discuss blockchain security, the benefits of liquidity locking for users, and the future of DeFi.
What inspired you to create a service for liquidity/token locking
The original idea came from Jeff Kirdeikis, Trustswap’s CEO. In a previous project Jeff was negotiating an investment in exchange for tokens. The only way at that time to ensure trust in the transaction was to pay a lawyer a ridiculous fee to escrow the money until the investor had sent over the money, and Jeff had sent over the tokens.
This, combined with being burned by other scams, inspired Jeff to think about how to leverage smart contracts to create trust.
What are the biggest challenges in this field?
This is changing, but as an industry we need to focus more on how to create the best product for the end user, not just a worse, slightly more decentralised version of what we see in the traditional financial sector. The market size of people who will use an inferior product just because it’s more decentralised is small.
If we really want to change the world, we’ve got to find a way to create superior products that incorporate the best elements of decentralisation. That starts with really solid user research and discovery, which is something that is time consuming but ultimately will help us really move the needle.
Could you describe for newcomers to crypto, why it’s important to analyze the locked liquidity of crypto projects?
For investors, you want to make sure that the team you’re investing in is aligned with driving value to the project over the long run. One of the great things about crypto is increased liquidity - in this case liquidity pools and IDOs make it possible for investors to participate in a company’s growth and success much earlier than traditional venture-startups. However this can be a double-edged sword, because if teams can sell tokens immediately, this increases the risk that they will do so and crash the token price.
Liquidity locks and token locks create the best of both worlds for the investor - the ability to access high-growth companies at an early stage while greatly decreasing the likelihood of scams.
What are some of the ways Team Finance might innovate and grow in the future?
Where do I start! Firstly, next month we’ll be releasing our dashboard, which will allow token founders to manage and see all their token needs in one place. Overtime we want to help founders with their treasury management, allowing them to forecast how changes in vesting and token prices impact their cashflow.
On the locks side, we’re watching the developments with liquid staking very closely and think that locks could benefit from a similar framework. Payroll is another area that we’re exploring.
Crypto is famous for all kinds of scam schemes. What are the red flags to watch out for when trying to identify a crypto scam?
Two main ones are:
1) Liquidity locked. Make sure that 90% or more of the liquidity pool for a new token on a DEX is locked. This greatly reduces the possibility of a rug pull.
2) Team tokens locked/token vesting. Make sure the core team has their tokens locked or vested. There is no one-size fits all approach for how long this should be for, but Lauren Stephhanian has a handy guide that I think is useful for investors to use when they are evaluating the trustworthiness of the project.
The good news is that more and more tools are being developed that help investors better navigate the ecosystem. Solidus Labs released a great report on scams and what to watch out for which I’d recommend. Sites like Coinbrain are also really helping investors through the addition of ‘safety checks’ which is great to see.
What should change so the industry becomes more transparent?
I actually think we’re getting close to the stage where instead of calling for more transparency, we’ll be calling for proofs. There are a number of valid reasons why you wouldn’t want your transaction history on-chain for all to see. To overcome this while still allowing for trust, we’ll be seeing a lot more use of things like zero-knowledge proofs.
What do you think is the most important aspect of blockchain security that many new projects overlook?
Lock and vest your tokens! It’s literally the fastest and easiest way to 10x your credibility and investment worthiness.
How do you envision the impact of DeFi on the traditional financial system?
The possibilities are endless, but we shouldn’t think that DeFi is inevitable. To succeed, DeFi has to outcompete centralised alternatives. The average user doesn’t care that something is decentralised, they just care that it works and that it works better than anything else.
I spent a number of years working in Latin America. It has one of the highest rates of crypto adoption in the world, but also some of the best domestic payment rails in countries like Brazil and Mexico. For DeFi to really gain a foothold, it needs to focus on real use cases. For example Bitso, Mexico’s largest exchange, facilitates over 5% of all remittances between the US and Mexico, which is the largest in the world.
These use cases will inevitably grow and evolve over time, and that’s where we’ll see big shifts of volume and users towards DeFi.