What is BarnBridge?
BarnBridge is a risk tokenization protocol. Its applications allow users to hedge factors such as yield sensitivity or asset price volatility by tokenizing various levels of risk exposure to a given underlying liquidity pool. These tokenized positions, referred to as either senior or junior tranches, are then as liquid as any other ERC-721 or ERC-20 token, respectively.
Although first designed in Q2 of 2019, BarnBridge was officially introduced in September 2020 upon the close of its seed funding round. BarnBridge aims to facilitate the transition of traditional financial institutions to decentralized finance with smart contract solutions for risk management.
What is the project trying to achieve?
The yield products in the decentralized markets which are yielding higher APY than yield products in traditional markets are currently crypto-backed loans. Instead of selling crypto for fiat, borrowers are staking digital assets and receiving digital assets in return.
While these loans have mostly been short-term loans to traders, the system has proven to be efficient & ripe for expansion. These efficiencies will inevitably attract higher value, longer duration loans to decentralized ledgers.
What is the unique selling point?
Tokenized Risk Protocol
They plan to create the first cross platform derivatives protocol for any and all fluctuations. To start, we will focus on yield sensitivity & market price. Downstream, we plan to introduce a far wider variety of hedges against fluctuations in the decentralized ecosystem. BarnBridge aims to be platform and asset agnostic.
Initial Product Offerings
SMART $BONDS - Structured Market Adjusted Risk Tranches
SMART Yield Bonds
Their first structuring will not only allow DeFi users to get access to fixed yield but also pools yield from numerous protocols across the ecosystem creating a more efficient market, again, smoothing out the yield curve across the entire industry.