DeFi duo take action again: Curve founder targets BTC, AC prepares all-in-one exchange

Author: Ash

Translation: TechFlow

Original Title: New Projects from DeFi Veterans: Curve Founder Launches BTC Pool, AC to Build an All-in-One Exchange

@CurveFinance founder @newmichwill is launching @yieldbasis, a Bitcoin AMM liquidity platform with no impermanent loss (Note: IL, impermanent loss, refers to the potential loss you may incur as a liquidity provider to an AMM compared to simply holding the tokens);

Meanwhile, @yearnfi founder and DeFi god @AndreCronjeTech is building @flyingtulip_, a unified AMM+CLOB (Note: Automated Market Maker + Central Limit Order Book. AMM provides continuous liquidity and automatic pricing, while CLOB offers more precise price discovery and order execution) exchange.

Two different approaches to solve the same problem—how to make on-chain liquidity truly effective:

• Yield Basis ($YB): A Curve-native AMM that eliminates impermanent loss for BTC liquidity providers by maintaining a constant 2x leveraged BTC-crvUSD liquidity pool (LP value remains 1:1 with BTC while earning trading fees). Users can mint ybBTC (yield-bearing BTC).

• Flying Tulip ($FT): An on-chain unified exchange (including spot, lending, perpetual contracts, options, and structured yields), based on a volatility-aware hybrid AMM+CLOB architecture, combined with a slippage-aware lending mechanism, and ftUSD (a Delta-neutral USD equivalent) as the core incentive.

Yield Basis

• Traditional AMMs force BTC liquidity providers to sell when prices rise or buy when prices fall (√p exposure, i.e., market risk exposure measured in the square root of price), resulting in impermanent loss that often exceeds the fees earned from providing liquidity.

• The specific mechanism of Yield Basis will be detailed later, but the core is: users deposit BTC into the platform, the protocol borrows an equivalent amount of crvUSD, forming a 50/50 BTC-crvUSD Curve liquidity pool, and operates with 2x compounded leverage.

• A re-leveraged AMM and virtual pool keep the debt approximately 50% of the liquidity pool value; arbitrageurs profit by maintaining constant leverage.

• This allows the value of the liquidity pool to change linearly with BTC while earning trading fees.

• Liquidity providers hold ybBTC, a yield-bearing BTC receipt token that automatically compounds BTC-denominated trading fees.

• The platform also offers a governance token $YB, which can be locked as veYB for voting (e.g., choosing liquidity pool reward allocations).

• Yield Basis mainly targets BTC holders who wish to unlock productive BTC and earn fees in a protocol that solves the impermanent loss problem.

Flying Tulip

• The user experience and risk settings of traditional decentralized exchanges (DEXs) are usually static. Flying Tulip aims to bring centralized exchange (CEX)-level tools on-chain by adjusting the AMM curve based on volatility and the lending loan-to-value (LTV) based on actual execution/slippage.

• Its AMM adjusts curvature based on measured volatility (EWMA)—flattening (approaching constant sum) in low volatility to compress slippage and impermanent loss; becoming more product-like in high volatility to avoid liquidity exhaustion.

• ftUSD tokenizes Delta-neutral liquidity pool positions, used for incentive mechanisms and liquidity programs.

• The platform token $FT may be used for revenue buybacks, incentives, and liquidity programs.

• Flying Tulip is a DeFi super app: an exchange that supports spot, lending, perpetual contracts, and options simultaneously.

• Execution quality depends on accurate volatility/impact signals and robust risk control under stress conditions.

Outlook for Both Projects

Yield Basis aims to become the platform for BTC liquidity; Flying Tulip is committed to being the platform for all on-chain native trading. In the current era where perpetual DEXs dominate, the launch of Flying Tulip is timely. Frankly, if it can deliver optimal execution, Flying Tulip could even channel future BTC flows into pools like YB. If Yield Basis succeeds, ybBTC could become the "stETH" primitive for Bitcoin: BTC exposure + LP trading fees, with no impermanent loss. Flying Tulip has the potential to launch its integrated stack, giving users access to CEX-level tools; aiming for "one-stop trading covering all of DeFi." While maintaining cautious optimism about both projects, it should not be overlooked that these OG founders and top teams' projects remain untested, and the founders still need to balance the development of other protocols (such as Curve and Sonic).

The above image was compiled by TechFlow as follows: