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Sense Finance Raises $5.2M to Bring Yield Trading to DeFi

Dragonfly Capital led the funding round with participation including Robot Ventures and Bain Capital.

Aug 3, 2021 at 4:00 p.m. UTC
Updated Sep 14, 2021 at 1:34 p.m. UTC

Sense Finance, the company behind the upcoming Sense protocol, raised $5.2 million in a seed funding round led by Dragonfly Capital with participation from Robot Ventures and Bain Capital, among others.

The protocol enables fixed interest rates and future yield trading on all yield-bearing assets in decentralized finance (DeFi) markets by splitting assets into principal and yield components and packaging them as "Zeros" and "Claims." These packages allow users to earn or borrow at a fixed rate and trade against future yields.

According to Kenton Prescott, the co-founder and CEO of Sense, existing yield trading solutions in DeFi are prone to protocol insolvency and capital lock-ups, and are often not user-friendly. 

As DeFi continues to grow, users are increasingly looking for on-chain financial products beyond simply buying and selling tokens. While some financial products from traditional financial markets such as structured products and derivatives are thriving, concepts such as yield curves have yet to gain much traction. 

Prescott said that yield curves, which are considered critical infrastructure in traditional finance, are underexplored in the decentralized financial markets and are key to DeFi’s maturity in the long run.

CORRECTION (August 3, 16:09 UTC): Sense Finance has not already launched its protocol.

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