Anzen Overview
The world's first protocol for Private Credit protection
The goal of Anzen is to create a perpetually scaling reserve pool such that the protocol generates sustainable yields indefinitely. The following diagram depicts the key drivers for the dual flywheel that is created between Anzen which receives Reserve Payments and Eligible Sponsors that operate credit platforms or underwrite transactions within the private credit market.
Sustainable, exogenous yield coming into Defi is a multi trillion dollar opportunity. Join us on the path to $1B TVL, supported by real world assets.
Users can stake Stablecoins (USDC or FRAX) or ANZ protocol token to earn sustainable yield from Treasury farming, Reserve Payments, and ANZ protocol tokens. Staked funds will be utilized to provide credit protection for rigorously underwritten Tradfi investment assets.
Monthly Risk Premium (Reserve Payments) will be paid into Anzen in return for providing this credit protection pool. These Reserve Payments will be priced to cover the default risk that Stakers are exposed to.
Over time, the Treasury (protocol owned liquidity) will grow into a perpetually scaling reserve pool such that the protocol generates sustainable yields indefinitely.
The $46 trillion public credit markets have leveraged transparency, standardization, and governance to build out a $10 trillion credit default swap and bond insurance market that provides downside protection for investors.
Recent innovations in the $8 trillion private credit markets have brought that same transparency, standardization, and governance into the ecosystem, and yet there is still no credit protection offering available for this massive market.
Anzen has the opportunity to leverage the power of DeFi to be the first to deliver credit protection to a private credit market that is unserved by TradFi.
Anzen will provide private credit investors with loss protection by collecting Reserve Payments and using these cash flows alongside the Anzen treasury and staking pools to cover potential losses arising from Covered Defaults. The end result is a perpetually scaling reserve pool whose investors are properly incentivized and benefit from an increasingly diversified capital base.
Anzen will also only apply coverage to transactions that meet strict Eligibility requirements that is governed by veANZ holders. veANZ holders will have a variety of voting powers to maintain high quality assets are being covered, economics that incentivize all stakeholders and other controls.
At a high level, usage of the protocol is as follows (note these steps are not necessarily sequential):
- Stakers or Liquidity Providers deposit capital into Anzen to earn yield from incoming reserve payments, AMO activities, and ANZ token incentive yield
- If the Eligible Transactions are indeed eligible for coverage based on Anzen's Eligibility Criteria and as verified by an independent 3rd party verification agent, a standard Reserve Payment will be assigned to the Approved Eligible Transaction
- Approved Eligible Transaction's borrower or investors will send Reserve Payments to Anzen Treasury on its regular payment dates of interest and principal
- If a Covered Default occurs, a process will be followed ensure an orderly verification, potential payout and subsequent recoveries. Payout amounts will come from staked capital and Anzen's treasury
- The payout amount in a Covered Default scenario for any given Approved Eligible Transaction is set by the Coverage Ratio as well as the the coverage limits specified in each Reserve Agreement
Last modified 9mo ago