Why Strata
Structured Yield Products: Risk-Optimized Access to Crypto-Native Yields.
Strata: Structured Risk. Structured Yield.
Today’s DeFi yield products are one-size-fits-all, where every depositor bears the same risk regardless of their individual risk tolerance. This limits adoption from conservative capital and prevents efficient, market-based pricing of risk. As investor demand shifts from standardized yields to tailored, risk-optimized yields, risk-tranching becomes the essential missing layer DeFi needs today to democratize crypto-native yields.
Strata introduces a risk-tranching protocol designed to offer structured yield products on crypto-native yields by splitting yield and risk into two tokenized tranches : Senior and Junior, each designed for distinct risk-reward profiles.
Senior tranche is suitable for risk-averse investors, providing the safest access to the underlying yield strategy with protection against strategy and counterparty risks.
Junior tranche acts as a liquid insurance fund underwriting the strategy risk (credit, volatility, protocol) in exchange for a risk premium from the senior tranche, providing leveraged upside to the underlying yield.
This structure enables transparent, market-driven pricing of risk, attracts a wider range of investors from risk-averse institutions to yield-seeking DeFi users, and transforms DeFi yields into structured, risk-adjusted financial products similar to how securitization scaled fixed income in TradFi. It eliminates the need for an embedded insurance fund in DeFi yield products by allowing the market to price underlying risk directly. The junior tranche assumes this risk in exchange for higher potential returns, while the senior tranche gets safer, moderate returns with built-in protection.
Strata targets global conservative capital to be onboarded into on-chain finance with low-risk, uncorrelated, transparent and scalable crypto-native yields while meeting high-yield demand from DeFi-native users.
Strata x Ethena: Structured Yield Products on USDe
The one-size-fits-all design of Ethena’s sUSDe - while elegant in its simplicity - is not optimal for many investors across DeFi and TradFi. Different capital allocators have varying risk appetites and return expectations, which a single yield product cannot fully satisfy.
The one-size-fits-all design of Ethena’s sUSDe, although elegant and simple, is not ideal for many investors across DeFi and TradFi. Different capital allocators have varying risk appetites and return expectations, which a single yield product cannot fully satisfy.
Strata is purpose-built to deliver structured yields on Ethena’s carry and basis strategies by segmenting risk into distinct tranches, each tailored to match the risk-return profiles of different investor types. This tranching structure unlocks targeted exposure, improves capital efficiency, and catalyzes the next phase of Ethena’s growth: one that is more inclusive, scalable, and institution-ready.
By transforming sUSDe into risk-tiered tranches, allowing different types of investors to access yield based on their risk appetite, Strata is redefining how Ethena’s crypto-native yield is accessed, managed, and scaled.
Tailored Risk Exposure Conservative investors prioritize predictable, low‑risk returns, while risk-tolerant users seek higher-yield opportunities with greater upside.
Enhanced Risk-Return Pricing Splitting USDe rewards into senior and junior risk tranches enables real-time and transparent market-based pricing of risk and returns.
Capital-Efficient Access Both tranches are tokenized as fully permissionless and composable assets, enabling seamless integration across DeFi and CeFi. This design offers enhanced capital efficiency, flexibility, and broad accessibility for a wide range of users.
Ethena’s yield engine combined with Strata’s risk-tranching democratises access to tailored, risk-adjusted yields by unlocking a new class of investment products. By bringing together the principles of traditional structured finance with DeFi’s programmability and composability, Strata delivers enhanced risk-adjusted yields and capital efficiency, reinforcing USDe’s position as a core asset for scalable, programmable crypto-native yields in DeFi.
Strata’s dual-token design marks a meaningful shift in the risk management for Ethena USDe users by splitting risk and yield into distinct senior and junior tranches.
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