TrueFi Introduces Trinity Protocol, Targets Enhanced Capital Efficiency of On-Chain Assets
Summary:
Decentralized lending protocol TrueFi has launched the Trinity protocol to increase the capital efficiency of on-chain real-world assets. The protocol uses the dollar-valued TRI token backed by collateralized assets, offering users up to a 15-20% net yield. The Trinity protocol is currently active on the Optimism Sepolia testnet and is expected to launch on Coinbase’s layer-2 Base network, initially unavailable to U.S. users. TrueFi issued $1 billion in loans in 2021, following the introduction of their first protocol in 2020.
The decentralized lending protocol, TrueFi, has launched a new initiative called the Trinity protocol. Its purpose is to improve the capital efficiency of real-world assets on the blockchain. The TRI token, which is backed by collateral assets and valued in dollars, aims to make risk hedging and leverage procurement more accessible. The tfBILL, a short-term US Treasury bill token producing interest, will be the inaugural collateral asset supporting TRI. However, the potential pool could expand to include other TrueFi pools, real-world assets from diverse protocols, and additional crypto-centric assets.
Under the new protocol, a user can create TRI using tfBill or other assets as collateral. They can then exchange the TRI for a stablecoin using an automated market maker. The user can then generate more TRI via a smart contract feature termed a 'vessel', borrowing up to 92% of the loan-to-value ratio in TRI. The TRI can then be exchanged again for the stablecoin, and this cycle can be repeated. Ultimately, users could net a yield of up to 15–20%.
Users also have the option to exchange stablecoins for TRI and deposit it into the sTRI vault, providing an expected yield close to or surpassing T-bill rates. TRI can also be traded on secondary markets.
TrueFi reported that the peak of on-chain real-world assets was in April 2022, with hundreds of millions in outstanding loans to trading firms. The market is now down to just a third of that peak.
The Trinity protocol is currently live on the Optimism Sepolia testnet. After its audit is completed, initial users will be selected. The launch version is expected to have a $40 million TRI mint cap.
TrueFi has plans to debut Trinity on Coinbase’s layer-2 Base network, but it is not expected to be initially available to US users. The Base network has approximately 150,000 verified addresses which can validate non-US residency and ensure institutional whitelisting.
TrueFi unveiled their first protocol in 2020 and issued $1 billion in loans the following year.
Published At
3/25/2024 7:24:15 PM
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