Nunchi Introduction
1. Our Mission: Making Yield Itself a Tradable Asset
For the last decade, DeFi has perfected the art of trading the price of assets. The next great frontier is trading the most fundamental driver of value in all of finance: the interest rate.
Every CEX funding rate, every DeFi borrow rate, and every real-world asset coupon is a floating yield that creates massive, unhedged risk for treasuries, traders, and liquidity providers. Until now, there has been no single, capital-efficient venue to manage this risk on-chain.
Nunchi is building that venue. Our mission is to transform yield from a passive, fragmented metric into a liquid, tradable, and perpetual asset class. We are creating the definitive on-chain exchange for rate-based derivatives, building the missing link between the crypto economy and the multi-trillion-dollar global rates market.
b. What is Nunchi? (The Problem & The Solution)
The Problem: Yield is Not a Price, and It is Not Monolithic.
The infrastructure built for price-based perpetuals is ill-suited for the unique nature of yield. Price speculation often thrives on high-frequency trading, making volume a natural measure of success.
But yield is different. It is fundamentally a balance-sheet instrument. A DAO treasury hedging its T-Bill portfolio opens a position and holds it for a quarter. A yield farmer locks in a rate and holds it for months. The primary goal for these users is not rapid turnover, but long-term risk management. This requires a new way of thinking about both product design and platform success.
Every yield-bearing asset can be deconstructed into two fundamental risk components: its Price (principal risk) and its Rate (cash flow risk). To simply trade "yield" is to see only a shadow. To master it, you need the tools to control both.
The Solution: A New Class of Perpetuals for a New Asset Class
Nunchi is the first perpetuals exchange designed from the ground up to serve the unique needs of a rates market. Because our users are managing long-term positions, evaluating the health and utility of our platform requires a different lens. While trading volume is important, the measures of a thriving rates market are the scale of risk being managed and the economic activity being generated. This points to two key indicators:
Open Interest (OI): The total notional value of all open positions, reflecting the market's trust and utilization of the platform for risk management.
Yield Streamed: The total value of all coupon and funding cash flows settled between participants, representing the core economic activity facilitated by our engine.
The Nunchi Primitives: We have engineered two distinct, yet complementary, perpetual contract types:
Yield Perps (YPs): To Trade the Rate.
What it is: A Yield Perp tracks the annualized yield (APY) of an asset, like the 3-month T-Bill coupon or the Aave borrow rate. It is the primitive for managing cash flow risk.
For DAOs & Treasuries: Short a Yield Perp to transform a floating APY into a synthetic, fixed-rate coupon, guaranteeing predictable income for your runway.
For Traders: Go long a Yield Perp to speculate on rising interest rates or amplified staking rewards.
Basis Perps (BPs): To Trade the Price Ratio.
What it is: A Basis Perp tracks the price ratio of a yield-bearing asset against its underlying base, like the stETH/ETH discount or the NAV of an LP token. It is the primitive for managing principal risk.
For LPs & Hedgers: Short a Basis Perp to hedge against impermanent loss or the premium decay of a Liquid Staking Token, isolating your fee income from price volatility.
For Traders: Go long a Basis Perp to speculate on a re-peg, or short it to capture a collapsing premium.
These two primitives are the foundation of Nunchi, allowing any participant to construct their desired exposure with precision. To power these new markets, we have built a new class of DEX engine: a Hybrid CLOB/AMM designed for CEX-level performance and decentralized resilience, ensuring tight spreads and deep liquidity from day one.
This is Nunchi: a new type of exchange, for a new on-chain asset class. Welcome to the future of on-chain finance.
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