OTFs are the hallmark of Lorenzo Protocol.
They represent the on-chain, tokenized evolution of traditional fund structures, similar in spirit to ETFs (Exchange-Traded Funds) but entirely transparent, programmable, and interoperable within the blockchain environment.
Unlike typical DeFi products that remain relatively limited to spot trading, lending, or AMM-based yield generation, OTFs open access to a much broader universe of financial strategies. Each OTF wraps a specific investment thesis or trading methodology into a tokenized instrument that users can easily mint, redeem, or trade.
Key features include:
• Full Transparency: All fund compositions, movements, and performance metrics remain visible on-chain.
• Flexibility: Users can enter or exit positions in a frictionless manner by interacting with the associated OTF tokens.
• Safe Custody: The strategy execution remains handled by the protocol’s smart contract infrastructure, reducing reliance on traditional fund managers.
OTFs essentially democratize structured financial exposure, making it possible for smaller investors to access hedge-fund-level strategies in a permissionless environment.
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