About

Tranche is a decentralized protocol for managing risk. Integrating with other DeFi protocols such as Compound and Aave, the project allows users to slice any interest accrual token into a fixed rate and variable rate component. For example, Compound’s cTokens can be sliced into fixed rate Tranche A tokens and variable rate Tranche B tokens. This allows users to invest in DeFi protocols at their preferred risk level.

History

There is a wide range of different debt instruments available on financial markets today. Traditionally, debt instruments such as mortgages or bonds are bundled together as Collateralized Debt Obligations (CDOs). By slicing these instruments into smaller pieces or “tranches”, new instruments can be created with different risk profiles and characteristics. This makes them suitable for different market participants. Tranche Finance seeks to bring tranches to DeFi.

The project is being developed by Jibrel, a blockchain development company based out of Zug, Switzerland. Established in September 2017, Jibrel is the team behind Ethereum wallet Jwallet, digital assets price-feed Jticker, and Nodes-as-a-Service platform Jnode. In 2020, the team launched Tranche Finance.

Tranche allows users to deposit into DeFi protocols with different debt seniority. Users seeking high returns can deposit into riskier levered tranches, and those seeking more stable returns can invest in the fixed yield senior tranches. This way, Tranche introduces Crypto-Collateral Debt Obligations (Crypto-CDOs).

In November 2017, Jibrel raised funding for the development of the mentioned projects through the public sale of Jibrel Network Tokens (JNT). With the launch of Tranche Finance, SLICE was airdropped to JNT holders in a 10:1 token swap on February 28, 2021.