Andre Cronje, a name that often sparks strong opinions across the crypto world, is back. He’s launched a new project, Flying Tulip, and it’s already making waves. This isn’t just another DeFi venture. It aims to stitch together the entire decentralized finance landscape under one roof, a rather ambitious undertaking.
- Andre Cronje’s new project, Flying Tulip, has secured $200 million in a private seed funding round, aiming to integrate the entire decentralized finance landscape.
- The project introduces an “onchain redemption right” or perpetual put, allowing investors to burn tokens and redeem their principal, offering downside protection while preserving upside potential.
- Flying Tulip plans to build a full-stack onchain exchange integrating various DeFi functions and aims to launch on multiple blockchain networks, starting with Sonic for zero-fee trading.
The project recently closed a private seed funding round, pulling in a hefty $200 million. This raise, structured as a simple agreement for future tokens (SAFT), pegs Flying Tulip’s token at a $1 billion fully diluted valuation. That’s a lot of zeroes for a project still in its early stages.
The funding round wrapped up in just a month, starting on August 14. No single investor led the charge. Instead, a lineup of familiar names in the digital asset space participated. These included Brevan Howard Digital, CoinFund, DWF Labs, FalconX, Hypersphere, Lemniscap, Nascent, Republic Digital, Selini, Sigil Fund, Susquehanna Crypto, Tioga Capital, and Virtuals Protocol.
Now, Flying Tulip has its sights set on an even bigger prize. It plans to raise up to another $800 million. This will happen through a public sale of its FT token, keeping the same $1 billion valuation. Interestingly, this sale won’t use existing ICO platforms. Instead, it will be hosted directly on Flying Tulip’s own platform.
A New Twist on Investor Protection
One feature of Flying Tulip’s fundraising stands out. It’s called the “onchain redemption right,” or a perpetual put. This mechanism allows investors, both private and public, to burn their FT tokens at any time. In return, they can redeem up to their original principal. Imagine putting in ETH, and being able to get that ETH back, no matter what the token price does.
Cronje designed this model with a clear goal. He wants to give investors downside protection. At the same time, it preserves their “unlimited upside” if the token performs well. It’s a bit like having your cake and eating it too, at least on paper.
Cronje explained this unique approach. He said the perpetual put means these funds can’t actually be spent by the team. “The [perpetual] put means none of these funds can be used, so actual raised is [zero],” he stated. This might sound counterintuitive for a project that just raised $200 million.
So, what happens with the money? The plan is to deploy up to $1 billion of the potential raised capital into onchain strategies. Think of protocols like Aave, Ethena, and Spark. These are places where capital can earn a return. Flying Tulip aims for a roughly 4% annual yield from this pool.
That 4% yield could generate about $40 million each year. This recurring income would then fund Flying Tulip’s growth, incentives, and token buybacks. Cronje calls this a “self-reinforcing growth flywheel.” It’s a system designed to feed itself, driving value back into the ecosystem.
This design comes from Cronje’s past experiences. He’s been involved in big token projects like Yearn and Sonic. He understands the pressures that come with managing a token. “The token itself is a product,” he wrote in his pitch deck. “If the price ever dips below where investors joined, this leads to short term decision making choices that might benefit the token at the cost of the protocol.”
By providing a mechanism for investors to exit at their original principal, Cronje believes it reduces stress. It gives the team comfort, knowing there’s a floor. This allows them to focus on building the protocol, rather than constantly worrying about token price fluctuations.
Redemptions won’t be a free-for-all. Audited smart contracts will manage them. Safeguards like queues and rate limits are in place to protect the system’s solvency. If reserves are temporarily low, requests will enter a transparent queue. They get processed as capital replenishes. It’s a thoughtful approach to a potentially complex system.
One more detail: FT tokens won’t be transferable until the public sale is complete. And for the team members? They get no initial token allocation. Their compensation will come from scheduled open-market buybacks. These buybacks are funded by protocol revenue, directly tying their success to the project’s performance. It’s a model that aligns incentives quite tightly.
Building a Full-Stack DeFi Exchange
Flying Tulip isn’t just another decentralized exchange (DEX). Cronje describes it as a full-stack onchain exchange. It aims to integrate a wide array of DeFi functions into a single, cross-margin system. This includes spot trading, derivatives, lending, money markets, a native stablecoin (ftUSD), and onchain insurance.
“It isn’t ‘a DEX’,” Cronje clarified. “It’s a ground-up rebuild of lending, trading, AMM (automated market maker), CLOB (central limit order book), derivatives, insurance, and stablecoins, each with their own unique innovations.” That’s a mouthful, but it paints a picture of ambition.
When you consider the scope, Flying Tulip has many competitors. At a holistic level, you might think of centralized giants like Coinbase and Binance. But at the product level, it competes with specialized protocols. These include Ethena for stablecoins, Hyperliquid for derivatives, Aave for lending, and Uniswap for swaps.
The exchange is still under development. Cronje offered a classic crypto timeline for its launch: “sooner than people think, later than people hope.” It builds on his earlier Deriswap concept from 2020. That idea also sought to merge multiple DeFi functions into one platform. It seems some visions take time to fully bloom.
At launch, Flying Tulip plans to support several major blockchain networks. These include Ethereum, Avalanche, BNB Chain, Sonic, and Solana. More networks will follow. The initial rollout will be hardened on Sonic. This chain offers fee monetization and subsidies, allowing Flying Tulip to provide zero-fee trading. The full suite will then deploy to other chains.
Where will the money come from to keep this engine running? Revenue will flow from several sources. These include trading and lending fees, liquidations, ftUSD yield, and insurance. The project currently employs about 15 people across the U.S., Europe, and Asia, and they are actively hiring. It seems the team is growing as fast as the ambition.
This project, with its unique funding model and broad vision, certainly challenges some conventional wisdom in crypto. Will the perpetual put redefine how projects raise capital and manage investor expectations? Time will tell if this flying tulip can truly blossom across all of DeFi.
