Flying Tulip is a full-stack on-chain decentralized finance (DeFi) protocol founded by developer Andre Cronje. The project is designed as an integrated financial marketplace that combines spot trading, derivatives, lending, a native stablecoin, and on-chain insurance into a single, capital-efficient, cross-margin system. ^{[7] [9]}​

Overview

Flying Tulip aims to address issues of capital efficiency and fragmented liquidity prevalent in the DeFi sector by unifying multiple financial primitives within one ecosystem. The project's architecture is built upon the conceptual framework of Deriswap, a protocol first proposed by Andre Cronje in 2020, which sought to merge swaps, options, futures, and loans into a single platform. The core of the platform is a cross-margin system that allows users to leverage their assets across various activities, such as trading and lending, without needing to move capital between separate protocols. ^[8]​

A central tenet of the project is a novel approach to capital management and investor protection. Unlike many projects that spend raised funds on development and operations, Flying Tulip intends to deploy its entire capital pool into established, on-chain yield-generating strategies. The yield earned from this capital is then used to fund the project's growth, ecosystem incentives, and token buybacks. This model is coupled with an "onchain redemption right," a mechanism that allows investors to redeem their tokens for their original principal at any time, providing significant downside protection. The project's stated goal is to create a sustainable, self-reinforcing growth model where protocol revenue drives value back to the ecosystem and its token holders. ^{[4] [7]}​

In a statement about the project's scope, founder Andre Cronje noted, "It isn't 'a DEX.' It's a ground-up rebuild of lending, trading, AMM [automated market maker], CLOB [central limit order book], derivatives, insurance, and stablecoins, each with their own unique innovations." ^[7]​

History

The conceptual foundation for Flying Tulip dates back to 2020, when Andre Cronje introduced the idea of Deriswap, a protocol designed to combine multiple DeFi services into a single, capital-efficient contract. This concept served as the precursor to the more comprehensive vision of Flying Tulip. ^[8]​

The project began its private seed funding round on August 14, 2025, and successfully closed the round by September, raising 25 million, followed by a further 183.9 million. The native FT token went live with its Token Generation Event (TGE) on February 23, 2026. ^{[7] [10] [11]}​

Technology and Features

Flying Tulip is architected as an integrated ecosystem of financial products that operate cohesively rather than as standalone services. The platform's components are linked through a single cross-margin system designed to maximize capital efficiency for users. ^[6]​

Core Architecture

The platform's design unifies several key DeFi services:

• Spot Trading: For direct asset-to-asset exchange.
• Derivatives: Including perpetual futures and options.
• Lending: A money market for borrowing and lending assets.
• Native Stablecoin: The ftUSD stablecoin, which is central to the ecosystem.
• On-chain Insurance: To provide risk transfer and mitigation products.

This integrated structure allows collateral deposited for one activity, such as lending, to be simultaneously used to margin positions in the derivatives market, reducing the total capital a user needs to lock within the ecosystem. ^[9]​

ftUSD Stablecoin

The ftUSD is a decentralized stablecoin pegged to the U.S. dollar that serves as a foundational component and native settlement currency within the Flying Tulip ecosystem. It is engineered to be fully on-chain, auditable, and transparent, with a delta-neutral architecture designed for stability without reliance on oracles. ^[12]​

By default, ftUSD is a non-yielding stablecoin. Users can opt-in to earn yield by staking their ftUSD in the protocol, which converts it into sftUSD, a separate, yield-accruing receipt token. The yield is generated from the protocol's capital deployment strategies and is distributed to sftUSD holders in the form of FT tokens, which are acquired by the treasury via open-market buys. Users must manually claim their accrued FT rewards. ^[12]​

Peg Stability and Mechanism

ftUSD maintains its $1 target through balanced, delta-neutral strategies that aim to generate a net positive yield while minimizing directional market exposure. The protocol manages risk through controls such as position caps and rebalancing bands. A typical strategy involves supplying a base asset like USDC to a money market to earn interest, borrowing a hedging asset against it, staking the borrowed asset to earn rewards, and looping the staked asset back as collateral to increase the position's safety. ^[12]​

The ftUSD uses a staged roll-out plan, beginning as a simple wrapper for stablecoin deposits into protocols like Aave and gradually expanding to include more complex, on-chain delta-neutral strategies based on lending, crypto-collateral, and perpetual futures. ^[12]​

Lending Market

The protocol features a money market with a dynamic risk management model. Instead of relying on static, predetermined asset lists and parameters, the lending market assesses risk based on real-time market conditions, including observed volatility and price impact. Key features include:

• Slippage-Aware LTV: Loan-to-Value (LTV) ratios, borrow caps, and health factors are dynamically adjusted based on the potential slippage that would occur if a position needed to be liquidated during periods of market stress.
• Same-Asset Debt: The market allows users to borrow the same asset that they provide as collateral. This feature is specifically designed to facilitate delta-neutral strategies for perpetuals and structured products. ^[6]

Trading Exchange

Flying Tulip employs a hybrid liquidity model for its trading exchange, combining a "volatility-aware" Automated Market Maker (AMM) with a Central Limit Order Book (CLOB). This dual structure allows the protocol to route trades to the venue offering the best execution price, optimizing for lower slippage and better rates for traders. For leverage trading, borrow limits are updated dynamically based on price impact and market volatility, enabling higher leverage during calm market conditions and automatically reducing risk when volatility increases. The platform also aims to simplify user onboarding through account abstraction and gas subsidies. ^[6]​

Perpetual Futures

The perpetuals exchange is designed to operate without reliance on external price oracles. The protocol uses pricing data generated from its own internal spot exchange for marking and settlement. This oracle-less design is intended to create a more robust and self-contained system, reducing dependencies on third-party data feeds that can be potential points of failure or manipulation. The core principle is that the internal settlement data itself constitutes the price. ^[6]​

Capital Management and Investor Protection

Flying Tulip introduces a distinct model for managing its treasury and protecting its investors, which deviates significantly from typical crypto project financing.

Onchain Redemption Right

A core feature of the project is the "onchain redemption right," a perpetual put option granted to investors in the primary token sales. This right is represented on-chain by an ftPUT, an ERC-721 non-fungible token (NFT). Each ftPUT NFT encodes the specific terms of its redemption right and is tradable on a secondary marketplace. ^{[10] [13]}​

Holders of the ftPUT have three options:

1. Hold: Keep the right open to preserve the principal-protection guarantee while participating in the FT token's potential upside.
2. Exit (Redeem): Exercise the put option to burn their FT tokens and redeem their original principal investment (e.g., exchanging FT back for the original USDC contributed).
3. Withdraw (Invalidate): Forfeit the redemption right permanently. This action unlocks the associated FT tokens for open-market activities like trading or liquidity provision. The capital backing that specific ftPUT is then released by the protocol to buy and burn FT from the market. ^[13]

This redemption is settled programmatically from a segregated, on-chain reserve funded by the capital raised. The process is managed by audited smart contracts with safety features like queues and rate-limiting to ensure solvency. This mechanism is designed to provide investors with a strong floor price, protecting their downside while preserving unlimited upside. ^[5]​

Capital Deployment Strategy

The capital raised from the token sales will not be spent on operational costs. Instead, the entire fund is to be deployed into established, on-chain yield-generating strategies through protocols such as Aave, Ethena, and Spark. The project targets an annual yield of approximately 4% on this capital. This recurring yield is the sole source of funding for the project's development, operations, ecosystem incentives, and token buybacks. This strategy ensures that the principal investment remains intact and accessible for redemptions. ^[8]​

Tokenomics (FT Token)

The native token of the Flying Tulip protocol is FT. Its tokenomics are designed to align the incentives of the team, investors, and users with the long-term success of the platform.

Supply and Value Accrual

The FT token has a fixed, pre-minted supply cap of 10 billion and is designed as a deflationary asset with zero inflation. Architected as an Omnichain Fungible Token (OFT), it supports native transfers across different blockchain networks. Value accrual is driven by a constant buyback program funded by all sources of protocol revenue, surplus yield from the treasury's capital deployment, and capital released when users invalidate their ftPUT redemption rights. These funds are used to buy FT from the open market, with a portion being burned to permanently reduce the total supply. ^{[13] [6]}​

Team Allocation and Incentives

The founding team of Flying Tulip receives no initial allocation of FT tokens. Instead, the team's compensation is tied directly to protocol performance. Protocol revenue is used to fund open-market buybacks of the FT token, and a corresponding amount of tokens is unlocked and distributed to the Foundation, Team, and for ecosystem incentives in a 40:40:20 ratio. This model ensures that team incentives are directly aligned with generating sustainable protocol revenue. ^{[4] [13]}​

Token Transferability

To prevent immediate arbitrage of the redemption mechanism, FT tokens remained non-transferable until the token generation event on February 23, 2026, which followed the conclusion of the public sale. This restriction was designed to mitigate the risk of participants buying tokens on a secondary market at a discount and immediately redeeming them. ^{[5] [11]}​

Funding

Flying Tulip's funding strategy involved a private seed round followed by a public sale and other token sales.

Private Seed Round

In September 2025, Flying Tulip announced the completion of a 1 billion fully diluted valuation. The round was structured as a Simple Agreement for Future Tokens (SAFT) and did not have a single lead investor. The round saw participation from a wide range of institutional backers, including:

• Brevan Howard Digital
• CoinFund
• DWF Labs
• FalconX
• Hypersphere
• Lemniscap
• Nascent
• Republic Digital
• Selini
• Sigil Fund
• Susquehanna Crypto
• Tioga Capital
• Virtuals Protocol

This list reflects the investors mentioned across multiple reports on the funding round. ^{[7] [4]}​

Public Sale and Additional Funding

Following the private round, the project conducted a public sale and raised additional funds through other avenues. A continuous public sale, termed a "Capital Allocation" event, was conducted on Flying Tulip's proprietary platform and offered tokens at the same 183.9 million. ^[10]​

In addition to the main public sale, the project raised 65 million in early February 2026 through token sales on launchpads such as Impossible Finance and CoinList. ^[11]​

Team

Flying Tulip was founded by Andre Cronje, a prominent developer in the DeFi space known for creating Yearn Finance (YFI) and his work with the Fantom ecosystem and the Sonic Foundation. As of September 2025, the team consists of approximately 15 globally distributed members located in the U.S., Europe, and Asia. The project is actively hiring to expand its team. ^[7]​

Launch Plan and Blockchain Support

The protocol is planned for a multi-chain deployment. The blockchains slated for support at launch include:

• Ethereum
• Avalanche
• BNB Chain
• Sonic
• Solana

The initial rollout strategy involves first launching and "hardening" the platform on the Sonic network. This approach is intended to leverage Sonic's infrastructure, including its fee monetization and subsidy features, which will allow Flying Tulip to offer zero-fee trading during its initial phase. Following this period, the full suite of services will be deployed to the other supported chains. ^[7]​