@Lorenzo Protocol is an on-chain asset management platform that makes traditional financial strategies accessible through tokenized products on the blockchain. Its aim is to allow individuals and institutions to use professional-style investment strategies in the crypto ecosystem, just like traditional funds or asset managers do — only through smart contracts.
Key points in a simple and straightforward way:
1. On-Chain Traded Funds (OTFs)
Lorenzo's main product is On-Chain Traded Funds (OTFs) — these are tokenized funds that bundle multiple yield strategies into a single token, similar to how ETFs work in traditional finance. OTFs are issued and traded on the blockchain through smart contracts.
2. How it works
Users deposit their assets (such as stablecoins or BTC) onto the platform. These assets are then deployed in various strategies through simple or composed vaults — such as quantitative trading, managed futures, volatility strategies, structured yield, etc. These strategies generate yield, and the user receives their share in the form of a token.
3. Yield & Tokenized Products
When assets are deployed in strategies, returns accrue through smart contracts. This yield can come from multiple sources — real-world assets, algorithmic trading, DeFi protocols, etc. OTF token holders can trade, redeem, or use their tokens in DeFi.
4. BANK token
BANK protocol's native token. It is used for governance (voting), incentives, staking, and ecosystem participation. BANK holders can vote on product parameters, fees, upgrades, etc., and can also earn some rewards.
5. Simplified example
Do you deposit your money into the Lorenzo vault? The protocol invests your money in multiple strategies. The returns from these strategies automatically reflect in the value of your token. You can trade or redeem your token at any time, without manual fund management.
