From Private Equity to On-Chain Public Offerings: How Lorenzo OTF is Redefining the $100 Trillion Asset Management Game
There is an iron law in the traditional fund industry: strategies that truly make money are never sold to retail investors. Volatility arbitrage, CTA trends, statistical arbitrage, convertible bond Gamma trading... These annualized Alphas of 15%-40% could only be accessed through private funds with a minimum investment of $10 million. Lorenzo Protocol has completely torn apart this iron law in less than two years.
Through the OTF framework, Lorenzo packages each strategy into an ERC-20 token, allowing users to subscribe in real-time at NAV with a minimum of $100. All vaults are managed jointly by on-chain multi-signatures and professional custodians (Coinbase Prime, Fireblocks), with strategy parameters, position details, and daily PnL all traceable on-chain, offering transparency far exceeding that of 99% of traditional hedge funds.
Even more critically is liquidity: traditional private funds are often locked up for 1-3 years, while OTF shares can be traded instantly on protocols like Uniswap V3 and Pendle, and can even be used as collateral for loans on Aave. This means that investors can enjoy institutional-level returns while retaining the unique flexibility of the crypto world.
Holders of $BANK are becoming the biggest beneficiaries of this revolution: the protocol has announced that starting Q1 2025, 70% of all vault management fees (2/20 structure) will be used for real-time buybacks of BANK, with the remaining 30% going into the veBANK staker dividend pool. When the management scale surpasses $1 billion, the annualized buyback yield will easily exceed 40%, far surpassing most staking projects.
What Lorenzo is doing is not simply "moving funds on-chain," but smashing the entry threshold of the entire private equity industry from $10 million down to $100.
