Term Structure, a decentralized finance (DeFi) protocol offering non-custodial fixed-income solutions for peer-to-peer and fixed-rate borrowing and lending, has successfully raised initial funding of USD 4.25 Million in a series seed fundraising round.
Cumberland DRW took the lead in this funding round, joined by Decima Fund, HashKey Capital, Longling Capital, and MZ Web3 Fund. The successful seed fundraising brings Term Structure's total funding to date to over $8 million. In speaking about why it led the funding round, Cumberland DRW said, "Fixed income products are a foundational element of traditional financial market structure, and demand for these products in DeFi markets is an important signal of the increasing maturity in this market sector. Term Structure, which is led by industry veterans, is an exciting investment for us and reflects our commitment to investing in innovative solutions that solve real market needs." Likewise, MZ Web3 Fund adds, “We are inspired by Term Structure’s vision to reshape DeFi with a structured interest rate system and comprehensive hedging instruments. Their commitment to providing fixed rates and term financing for tokenized real-world assets bridges the gap between TradFi and DeFi and holds great promise for the company and stakeholders.”
In TradFi, fixed-income products allow institutions and individuals to anticipate future cash flows and assess the relative value of diverse investment opportunities. However, these products are currently absent in DeFi. The Term Structure Protocol introduces fixed-income products, enabling users to earn fixed interest to receive an income stream or to secure fixed rates to manage funding costs. Furthermore, the establishment of fundamental fixed-income products catalyzes the development of advanced financial instruments, including forwards, futures, and options. They can be used for hedging, valuation, and pricing financial instruments.
Term Structure's Protocol testnet is live at https://app.testnet.ts.finance/ on Ethereum Goerli. The platform features primary markets for borrowing and lending with fixed interest rates and maturity dates and secondary markets for buying and selling fixed-income tokens through an orderbook trading system. Repurchase markets, which allow fixed-income tokens to be used as collateral, will soon become available.
To enhance security, the zkTrue-up scaling solution, a custom ZK Rollup, is implemented to achieve data availability and allow users to place and cancel orders without gas fees. In the event of censorship or other issues, users can initiate Forced Withdrawal through the zkTrue-up contract to directly withdraw their funds. If the withdrawal request remains unfulfilled, users can then activate the Evacuation Mode on the L1 contract as a protective measure for their assets.
A workshop introducing the protocol will be held on December 4th, 2023, on YouTube, followed by an AMA on December 5th, 2023. To promote understanding of interest rate products, a trading competition will be organized after the testnet launch. Prizes, including 10,000 USDC, will be distributed to winners and participants. Professional traders will soon have access to programmatic trading APIs and SDKs. Please follow Term Structure’s Twitter at https://twitter.com/TermStructLabs to receive the latest information.
Note: Decima Fund is a joint fund that includes gumi Incubation, MZ Cryptos, Animoca Brands, and SBI Holdings as general partners.
About Term Structure:
Term Structure is a decentralized fixed-income protocol that aims to establish interest rate curves in DeFi. This includes the development of Primary Markets with auctions and Secondary and Repurchase Markets with real-time order books. The protocol achieves scalability by employing zkTrue-up, a customized ZK Rollup that functions as a gas compression engine while ensuring data availability remains uncompromised. Our vision is to provide comprehensive investment and hedging instruments for DeFi and infrastructure for tokenized real-world assets. Please visit https://ts.finance/ for more information.