Flying Tulip's On-Chain Redemption Rights Redefine DeFi Safety

Flying Tulip, the DeFi project co-founded by Andre Cronje, has secured $200 million in a seed funding round, valuing its token at $1 billion on a fully diluted basisFlying Tulip raises $200M seed funding round at $1B valuation^[1]. The round, structured as a simple agreement for future tokens (SAFT), attracted participation from major institutional investors including Brevan Howard Digital, CoinFund, DWF Labs, FalconX, Hypersphere, and othersFlying Tulip raises $200M seed funding round at $1B valuation^[1]. The capital will support the development of a full-stack on-chain exchange integrating spot trading, derivatives, lending, money markets, a native stablecoin (ftUSD), and insurance within a cross-margin system designed for capital efficiencyFlying Tulip raises $200M seed funding round at $1B valuation^[1].

The project plans to raise an additional $800 million through a public token sale of its FT token, maintaining the $1 billion valuationFlying Tulip raises $200M seed funding round at $1B valuation^[1]. The public offering will be conducted directly on the platform, bypassing traditional ICO platforms. If successful, the combined private and public rounds would total $1 billion in funding, reflecting growing institutional confidence in Cronje’s track record and the DeFi sector’s potentialFlying Tulip raises $200M seed funding round at $1B valuation^[1].

A key innovation in Flying Tulip’s funding model is its "on-chain redemption right," described as a perpetual put option. Investors in both private and public rounds can redeem their tokens for their original contribution at any time, providing downside protection while preserving unlimited upside potentialFlying Tulip raises $200M seed funding round at $1B valuation^[1]. Redemptions are managed via audited smart contracts, with rate limits and queues to ensure solvency. The mechanism ties raised capital to on-chain yield-generating strategies through protocols like Aave and Ethena, targeting a 4% annualized return to fund growth, incentives, and token buybacksFlying Tulip raises $200M seed funding round at $1B valuation^[1].

Cronje emphasized that the team will not receive initial token allocations. Instead, team exposure will be earned through open-market buybacks funded by protocol revenues, aligning incentives with long-term platform adoptionFlying Tulip raises $200M seed funding round at $1B valuation^[1]. This approach contrasts with traditional tokenomics models, which often prioritize early allocations. The FT token will remain non-transferable until the public sale concludes, mitigating arbitrage risksFlying Tulip raises $200M seed funding round at $1B valuation^[1].

Flying Tulip’s platform distinguishes itself by consolidating DeFi primitives into a unified system. It supports Ethereum, Avalanche, BNB Chain, Sonic, and Solana, with plans to expand further. The initial rollout will prioritize Sonic, leveraging fee subsidies to enable zero-fee tradingFlying Tulip raises $200M seed funding round at $1B valuation^[1]. Revenue streams include trading fees, lending spreads, liquidations, stablecoin yield, and insurance premiums. Cronje described the platform as a "ground-up rebuild" of decentralized finance infrastructure, integrating automated market makers, central limit order books, and dynamic loan-to-value modelsFlying Tulip raises $200M seed funding round at $1B valuation^[1].

The project faces competition from established players like Coinbase and Binance, as well as specialized DeFi protocols such as Uniswap and AaveFlying Tulip raises $200M seed funding round at $1B valuation^[1]. However, its institutional-grade risk management features, including OFAC screening and tax reporting, aim to attract U.S. institutional investors. The team, currently 15 members strong, plans to expand rapidly as development acceleratesFlying Tulip raises $200M seed funding round at $1B valuation^[1].

Flying Tulip’s dual focus on innovative tokenomics and a comprehensive DeFi ecosystem positions it as a potential disruptor in the sector. If its model succeeds, it could redefine how DeFi projects structure funding rounds and investor protection. The combination of Cronje’s reputation, institutional backing, and a $1 billion valuation underscores its ambition to become a major player in on-chain financeFlying Tulip raises $200M seed funding round at $1B valuation^[1].