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Tranchess Protocol, A DeFi wealth management system has raised $1.5million in seed funding. It was performed by Three Arrows Capital and Spartan Group. Binance Labs, Longhash Ventures, IMO Ventures, etc. are also part of the funding round.
A chess-themed DeFi asset management platform, Tranchess Protocol, in a seed round had raised $1.5 million led by Three Arrows Capital and Spartan Group. The other investors in the first round of funding include Binance Labs, Longhash Ventures, IMO Ventures, and Key opinion leaders who do not wish to disclose their identities.
As per the release issued on Monday, the money raised will be used for the expansion of the project. This money will help the project become a multi-chain solution as it completes the development of the Decentralized Autonomous Organization (DAO).
Tranchess was launched on June 24 via Binance’s smart chain. It is under development for one year. Smart Chain is an ecosystem designed for DeFi beginner applications using smart contracts.
Appetite for risk
The project seeks to provide a risk/ return matrix from a single main fund, Queen that tracks a specific underlying crypto asset. This started after tracking the movement of Bitcoin, with the aim of adding more assets in the future. The funds raised will be used to provide services to a variety of customers with different risk tolerances. The user can split the fund into two sub-funds, Rook and Bishop to minimize the risk.
How does Bishop and Rook work?
Bishop is a yield tranche, it has no exposure to bitcoin’s price. Whereas the Rook fund is a leveraged tranche. Under this, the user has twice the exposure of price movements in the underlying crypto.
As per the spokesperson of Tranchees, the main fund is Queen which tracks bitcoin. It can be split into 0.5 Bishop tokens and 0.5 Rook tokens. Bishop tokens earn more yield and do not track bitcoin at all. Whereas Rook tokens earn a smaller yield and are essential twice the leverage token for bitcoin.
Chess-inspired theme
The DeFi token has a chess inspired theme. It borrows the concepts of the game including the implementation of game theory. Bishop interest voting system allows the users to vote on how much interest is generated in the fund. Whereas, the governance token, which cast votes, makes decisions regarding the protocol, named chess.
Su Zhu, Co-Founder, Three Arrows Capital said that the yield offered to bitcoin and stablecoin denominated investors through this different style of matching will find product-market fit. As per the speculations, the project is all set to hand over the management of the protocol to the DAO by Q4, 2021. It will also give 2.0 apps to the management.
With a background in journalism, Ritika Sharma has worked with many reputed media firms focusing on general news such as politics and crime. She joined The Coin Republic as a reporter for crypto, and found a great passion for cryptocurrency, Web3, NFTs and other digital assets. She spends a lot of time researching and delving deeper into these concepts around the clock, and is a strong advocate for women in STEM.
