Before in DeFi, most of us were forced into the same level of risk. You deposit into a vault, you receive the exact risk/reward of that strategy. Everyone shares the same position. Tranching is changing this by separating yield strategies into different risk layers: > Senior: prioritized repayment, lower risk, more stable yield > Junior: takes first-loss, in exchange for higher yield and greater upside Same yield, but now each person can choose the risk appetite that fits them. Projects making this sector clear: Tranching-as-a-Service: sitting on top of existing vaults/yield @strata_markets · @yearnfi · @roycoprotocol · @ExponentFinance Tranching-as-a-Product: running their own strategy + splitting into tranches @YuzuMoneyX · @avantprotocol · @TrancheFinance · @3Janexyz This is the first time DeFi truly allows risk/reward allocation instead of forcing everyone into the same position, exactly like traditional CLOs have done for a long time.