#lorenzoprotocol @Lorenzo Protocol
In the traditional world, Managed Futures funds require massive minimums, lock-up periods, and layers of intermediaries. Lorenzo Protocol bypasses this by using **On-Chain Traded Funds (OTFs)**.
Instead of just holding a "yield token," you hold a **tokenized strategy**. These OTFs behave like programmable versions of a hedge fund, executing complex logic 24/7 directly on the blockchain.
### đ Managed Futures & Trend Following
Managed Futures are professional investment strategies that use "Trend Following"âa systematic approach to identifying market momentum.
* **How it works on Lorenzo:** The protocolâs vaults use quantitative signals to automatically go long or short on various assets (commodities, currencies, or indices) based on market trends.
* **The Tokenization Edge:** These signals are baked into the smart contracts. When you hold the token, your capital is automatically routed into these strategies without you needing to lift a finger or understand complex technical indicators.
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## đ ď¸ The Architecture: Simple vs. Composed Vaults
Lorenzo uses a modular vault system to manage these advanced tools:
| Feature | **Simple Vaults** | **Composed Vaults** |
| --- | --- | --- |
| **Focus** | Isolates a **single strategy** (e.g., just Trend Following). | Merges **multiple strategies** into one portfolio. |
| **Use Case** | Users who want precision and predictable exposure. | Users looking for a balanced, "all-in-one" macro fund. |
| **Benefit** | Transparency; you see exactly how that one strategy performs. | Risk management; one strategy's loss can be offset by another's gain. |
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## đ Why It Matters for the Ecosystem
1. **24/7 Execution:** Unlike Wall Street, crypto never sleeps. Lorenzoâs trend-following bots react to market data in real-time, capturing volatility that human managers might miss.
2. **Institutional-Grade Risk:** Strategies are compartmentalized. The risk in a Managed Futures vault stays there and doesnât "leak" into your staked BTC or stablecoin vaults.
3. **Composability:** Because these strategies are **tokens**, you can use them as collateral in other DeFi protocols. You aren't just "investing" in a fund; you are holding a liquid asset that works for you across the entire Web3 economy.
### đłď¸ The Role of $BANK
The **$BANK token** acts as the coordination layer for these products. Through **veBANK** (vote-escrowed BANK), the community can influence which strategiesâlike specific Trend Following modelsâget more incentives or are added to the next flagship OTF.
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> **"Lorenzo is not just building a bank; itâs building the factory where the financial products of the future are designed."** $BANK
