BarnBridge, founded in 2019, is a protocol for tokenizing risks. It was launched in September 2020. BarnBridge is a sort of decentralized finance (DeFi) lego for creating tradeable tokens that expose a consumer to market volatility. As of March 2021, the platform is still in an early stage of launch.
BarnBridge is a project that expands the functionality of DeFi to make it more flexible and efficient. By tokenizing market fluctuations and exposure to risks, it can reduce volatility for conservative investors or increase it for daytraders. BarnBridge enables traditional risk management tools and fixed income instruments on the DeFi market. The main focus is dividing cryptocurrency risks into tranches so market participants, depending on their risk profile, can invest in different products or assets.
The idea for BarnBridge was originally conceived in 2019. At the time, MakerDAO started to garner mainstream awareness and capture the imagination of what is now the DeFi community.
A year later, as 60% of global debt was yielding less than 1% and over $15 trillion of global debt was yielding negative rates, capital continued moving into higher risk yield streams.
TradFi continues to experience a historic uptick in aggregate debt levels while yield and interest rates continue to plummet. Meanwhile, yield on the DeFi-equivalent instruments continued to dwarf the menial rates offered by legacy TradFi products.
The need for familiar TradFi derivatives to exist in the DeFi ecosystem has never been greater. And thus, BarnBridge was born to address the essential need for managing risk.
