Author: Nancy, PANews
From financial innovation experiments to the cornerstone of the liquidity market, DeFi has experienced rapid development and evolution in the ups and downs of many years. With the deleveraging amplification cycle evolution effect, the DeFi ecosystem encountered a liquidity crisis, and the gears of fate of each company also turned, and the competition entered a hand-to-hand fight.
Tranchess, which plays with the concept of tiered funds, is a veteran player in the DeFi track. In the past few years, it has continued to improve its ability to cross cycles around asset management and has joined the narrative wave of liquidity staking.
The tiered fund model matches different risk preferences and has attracted more than US$250 million
Tranchess is a hierarchical structure fund in the DeFi world, which mainly provides investment needs with different risk preferences and solves problems such as impermanent loss, inefficient funds, and forced liquidation. This way of breaking down risk levels and expected returns once attracted a lot of attention from the market. The popularity of Tranchess can be directly reflected in the soaring TVL indicator at that time, which also confirmed the market fit of the product.
A tiered fund is a financial derivative instrument, characterized by the classification of fund products and risks into different levels. Generally, the A-level sub-fund mainly obtains fixed income, and the B-level sub-fund mainly obtains residual income. Tranchess has derived multiple risk/return matrices from a single main fund, among which Queen is the parent fund, which is mainly created for BTCB, ETH (annual management fee of 1%) or BNB (annual management fee of 2%) funds, and can provide long-term holders with 2% to 16% additional income; Bishop and Rook are two sub-fund products with different risks and returns split from QUEEN. Each QUEEN can get 0.5 BISHOP and 0.5 ROOK. Bishop is a high-yield stablecoin product in the context of DeFi, which lends liquid assets to Rook holders and is designed for stable income users; Rook is a leveraged fund designed for aggressive investors, which can be understood as unsecured lending mining, and there is no risk of forced liquidation.
At the end of 2023, Transess launched its own qETH liquidity staking product on Ethereum, and then based on this, combined with its own tiered fund structure, it developed the Turbo & Stable product segment.
In the Turbo & Stable fund under Transess, Turbo stands for the enhanced version of ROOK, which allows users to earn points rewards through leverage; Stable is an enhanced version of BISHOP, which can earn a fixed interest rate. According to the official website, Transess's Turbo & Stable fund has launched related funds on Ethereum, BNB Chain and Scroll networks, and has attracted more than US$250 million. These products can be converted back to their respective underlying tokens after the event, and there is no lock-up period, creation/redemption fees, and split fees.
Take the STONE fund product launched on Scroll as an example. The STONE fund has received over $190 million in funding. This is a six-month fund jointly launched by Transess and StakeStone, mainly including stoneQUEEN, turPSTONE, staYSTONE, and staYSTONE-STONE LP. Among them, users can create stoneQUEEN with STONE at a ratio of 1:1 to get 1x points, or further split each stoneQUEEN into 0.1 turPSTONE and 0.9 staYSTONE to get 2x points. Among them, turPSTONE is equivalent to Turbo token, with 10 times inherent leverage and 2 times points bonus of StakeStone additional rewards, so holders can get 20 times StakeStone points (Note: After the fund expires, token holders can exchange the underlying assets (including STONE) in proportion to the net value at the time of expiration, so the figures are all approximate net values ââat the expiration date. Before that, users can exchange Turbo or stable back to STONE through swap, and this process is exchanged according to the current market transaction price displayed on the webpage. The exchange ratio of QUEEN is always 1:1. Same below); staYSTONE is a fixed-income Stable token, and holders can get a fixed 6% annualized interest (after the fund expires, according to its net value, it can be exchanged back to 1.0149 STONE), and no points are obtained. StaYSTONE-STONE LP holders can get a basket of income, including CHESS rewards, 0.05% handling fee rate, interest and points (2 times), and holders can add or remove liquidity in single currency or dual currency at any time.
Take the weETH fund jointly launched by Transess and ether.fi as an example. It includes weethQUEEN, turPWEETH, staYWEETH and staYWEETH-weETH LP. The activity will end on December 15 this year. Users can exchange weeth for weethQUEEN at a ratio of 1:1, and split each weethQUEEN into 0.1 turPWEETH and 0.9 staYWEETH. Similarly, each turPWEETH and 9 staYWEETH can be combined into 10 weethQUEENs, that is, the ratio is always 1=0.1+0.9, and weethQUEEN can get 4 times the points. TurPWEETH holders can also get 40 times the points with a 10x fixed leverage and ether.fi's 4x points multiplier (after the fund expires, it can be exchanged back to about 0.9426weETH based on its net value), and staYWEETH can get a fixed interest of 10% (after the fund expires, it can be exchanged back to about 1.006 weETH based on its net value). staYWEETH-weETH LP holders can receive CHESS rewards, 0.05% handling fee rate, interest and points (4 times) as rewards.
At the same time, through in-depth cooperation with the Scroll ecosystem, Transess allows Turbo & Stable products launched on Scroll to participate in Scroll's own Session rewards and obtain Scroll Marks points.
In addition, the Turbo & Stable Fund also includes SolvBTC, slisBNB and Staked ETH funds, and the product logic is consistent with the above products.
It is worth mentioning that Tranchess will charge a 3% fee based on the points obtained by the Turbo & stable fund. On BNB Chain, this 3% is calculated and paid by the project party and does not affect the user's points income; on Scroll, it is charged based on the user's Turbo points income. All points income will be 100% returned to the veCHESS users on the corresponding chain in full in accordance with the maturity of each project and the rhythm of TGE, further improving the yield of veCHESS holders.
From BNB to Ethereum, Tranchess is deeply engaged in the liquidity staking track
As an important branch of the DeFi ecosystem, liquidity pledge has supported half of the 10 billion TVL of DeFi. Since the Ethereum Shanghai upgrade, liquidity pledge has become a popular narrative in the DeFi track, and the flow of funds directly indicates this market trend. DeFiLlama data shows that as of August 24, the liquidity pledge track has occupied half of the DeFi market with more than 45 billion US dollars. Judging from the pledge rate of each mainstream POS chain, the liquidity pledge track still has a lot of room for growth.
In fact, after years of iteration and upgrading, Transess has entered the staking track. In fact, as early as the beginning of 2022, Transess had already entered the staking income track. At that time, it launched the BNB Fund and became a BSC verification node to obtain new income; in December of the same year, Transess launched the liquidity staking product qETH while listing on Ethereum; this year, Transess officially fired the first shot in the LSDFi track with the release of V3.
In addition to launching multiple products in collaboration with several well-known LSD protocols, Transess also supports liquidity staking of QUEEN tokens on Ethereum and BNB Chain. Among them, if users choose to stake ETH to exchange for qETH, they can get an APR of 4.4%, and the current total staking volume exceeds US$550,000. In addition to staking rewards, users can also provide liquidity in the qETH/ETH pool on Balancer, and LP will receive CHESS rewards and veBAL incentives, which may be used in more DeFi protocols in the future. Of course, the platform will charge a 10% fee after the user receives the staking reward, which will be allocated to the node operator, the Transess fund library, and the weekly rebate distribution of veCHESS holders.
In addition to the mining function that increases the yield of a single asset, BNBFund also adds a layer of Alpha income. Specifically, BNB Fund will stake BNB to the Tranchess validator node on the BNB Chain to obtain an APR of 8% to 16%, and distribute this part of the reward to all nQUEEN+ and nROOK+ holders (minus the protocol fee). You can also stake Q/B/R tokens to receive rewards in the form of CHESS tokens. For example, after a user stakes BNB to create an nQUEEN, he or she can receive a 0.45% POS staking reward and a 3.7% to 11.7% CHESS reward.
"As demand for Ethereum continues to grow, we expect liquid staking products such as qETH, STONE, and related products staYSTONE and turPSTONE to continue to attract attention. The Ethereum spot ETF will increase institutional investors' interest in Ethereum and staking, thereby driving an increase in Ethereum value and network demand, and staking yields will then rise," Tranchess said in a recent post.
As the concept of BTCFi matures, it is also worth continuing to pay attention to whether Transess, which was the first to introduce WBTC asset management on BNB Chain, can further explore opportunities to participate in BTCFi through its current cooperation with projects such as SolvBTC.
TVL has increased by more than 240% this year, and has received investment from Binance Labs and others
The impressive growth data demonstrates the strong competitiveness of Transess. According to DeFiLlama data, as of August 24, Transess's TVL has exceeded US$210 million, ranking second on Scroll, with a year-on-year increase of 241.9%.
As a DeFi protocol born during the DeFi boom, Tranchess announced the completion of a US$1.5 million seed round of funding as early as 2021, with many institutions participating in the investment, including Three Arrows Capital, The Spartan Group, Binance Labs, Longhash Ventures and IMO Ventures.
In addition to product strategy, the team is also an important factor behind the support of star capital. Danny Chong, co-founder of Tranchess, has more than 16 years of banking experience and was responsible for the SEA department of foreign exchange and fixed-rate product sales at Credit Agricole CIB. Other members have rich working experience in institutions such as Microsoft, Google, Morgan Stanley, and UBS.
Token economics is also an important part of the Transess ecosystem. The total supply of the governance token CHESS is 300 million, of which 50% will be used for community allocation and incentives. Holders can use it to participate in community decision-making, voting, and pay transaction fees. In addition to secondary market purchases, users can also obtain CHESS by staking QUEEN, BISHOP, or ROOK tokens (weight ratio of 3:4:2), providing liquidity for AMM pools, etc. veCHESS represents locked CHESS tokens, with a lock-up period ranging from one week to four years, and the exchange ratio will increase linearly (1 CHESS locked for one year will get 0.25 veCHESS, and 1 CHESS locked for four years will get 4 veCHESS). The rights and interests of veCHESS holders include voting on the distribution of Alpha income between BISHOP and ROOK, voting on the weekly release of CHESS, 50% of the protocol income distribution per week, improving staking efficiency, and the 3% Turbo & stable fund points income sharing mentioned above.
In addition, the community management proposal newly launched by Tranchess last Thursday stated that the future cooperation of Turbo & Stable will be decided by veCHESS users through voting. On the one hand, it further expands the application scenarios of veCHESS, and on the other hand, it illustrates the unlimited potential of the rapid replication of the Turbo & stable model.
Not only that, in the dark forest of DeFi, Transess is also working hard on security, including completing the smart contract audits of PeckShied and Certik, launching a bug bounty program with ImmuneFi, and reaching a cooperation with the DeFi insurance protocol InsurAce. According to the roadmap, Transess will continue to expand structured products, node operators, X-Chain and other expansions in 2024.
Overall, the established crypto structured fund Tranchess has provided more users with diversified risk strategies while improving the flexibility and efficiency of asset allocation. As the liquidity pledge track continues to explode, the popularity of the LSD track will also inject strong momentum into Tranchess's competition in the DeFi market.
