Flying Tulip June Update

Flying Tulip launched into a brutal market: the October crash hit during the raise, followed by dramatic repeated market-wide selloffs, including around launch.

Unlucky timing, but an ideal stress test for the PUT model. Since launch, many participants have exited their positions or withdrawn their FT. Yet that did not translate into proportional secondary-market sell pressure, with the token price remaining around the primary-sale price. With 100% of tokens unlocked, no vested tokens, and no special VC unlock structure, the team is fully aligned with FT holders who are a priority, rather than treated as a post-revenue afterthought.

As more products go live, user activity grows, and token buybacks trend higher, the impact of fee- and revenue-funded buybacks will become increasingly reflected on the secondary-market. Once protocol revenue is able to sustain team operations with over $3,500 per day, PUT yield is expected to contribute to buybacks and burns as well. At that point, unallocated and divested FT supply, over 94% of total supply, is planned to be burned.

Capital released from invalidated PUTs is already used for NAV-based buybacks and burns, with over $1.2M worth of FT already removed from circulation. In addition, about $1.8M in ftUSD and wETH is currently designated for future buybacks and burns, and is expected to be deployed as ftUSD-denominated limit orders on Spot.

The past four months have shown what aligned incentives can produce, even with weak DeFi yields, repeated market stress, and the Mythos scare.

With a current budget still below $1M, 100% of tokens unlocked, and no free token allocation, the Flying Tulip team has since February:

— launched the ftUSD stablecoin and settlement layer, with staked ftUSD currently yielding 13.27% on Ethereum and 5.53% on Sonic. The yield is not coming from emissions or a farming campaign, but from collateral yield, delta-neutral strategy yield, and FT bought back and distributed to stakers. Users can also provide liquidity and earn rewards on Curve.
— deployed the first fully on-chain delta-neutral architecture for ftUSD, first on Sonic and then on Ethereum. No lockups, no off-chain exposure.
— built and deployed a new version of the Flying Tulip PUT Marketplace.
— demonstrated a novel circuit-breaker safety system, that continuously monitors funds leaving the protocol. If outflows spike beyond a threshold over a short period, withdrawals are automatically rate-limited or queued.
— grew Lend TVL to $9.56M, doubling over the past 30 days, without incentives (yet!). Current USDC rates also show the capital-efficiency model in action: borrow USDC at 1.95%, or deposit USDC and earn 3.54% (😲), with deposit yield supported by both borrow demand and idle-strategy yield.
— completing work on Spot, leverage, and TRS, moving them into their final pre-launch stages, with interface screenshots already shared in Discord.

Flying Tulip Under Stress: Lend and the Perpetual PUT Marketplace

Market volatility in June provided a live stress test for two important parts of the Flying Tulip system: Lend and the Perpetual PUT Marketplace.

In the last week alone, margin-account based Lend processed 30+ stressed liquidations. When accounts crossed dynamic maintenance-margin thresholds, RFQ-based soft liquidations sold collateral required to restore account health, with an average haircut below 1% and near dollar-for-dollar debt repayment.

In traditional LTV (Loan-to-Value)-based lending, the borrowing power and the liquidation risk are primarily determined by using a s static percentage of the deposited collateral, with fixed liquidation thresholds. Flying Tulip's lending layer is designed to be more adaptive and contextual, using market depth and executable liquidity to help determine borrowing power and liquidation behavior, and giving holders more time to respond to volatility.

In liquidations on Lend, RFQ (Request for Quote) helps source executable quotes to sell only the collateral needed to repay debt and restore account health, ideally with low haircut and slippage, rather than dumping collateral in a single clip. In simple terms, the system asks: “I need to sell X for Y; what executable price can I get?” Solvers respond with quotes.

Lend is therefore designed to make liquidations less disruptive by making them market-aware. The system looks at depth, volatility, TWAP/RWAP, and where prices can actually clear. When liquidity is thin or volatility rises, available borrowing power tightens; when markets are calm and deep, borrowing power can expand. As a result, unnecessary forced selling is reduced, liquidations cause less overall pressure, and positions are healthier.

Broader market turbulence has also not impacted holders of Perpetual ftPUTs. These NFT-represented on-chain positions were sold during the primary sale and give holders the right to either exit their position by redeeming their original contributed capital, or invalidate the PUT and withdraw the associated FT.

Flying Tulip's PUT Marketplace gives holders another way to liquidate their position, by offering them a premium on an in-built marketplace, while preserving the underlying redemption rights for buyers. The Marketplace has already generated over $1.6M in trading volume, with 279 completed sales and 121 active listings.

A new and improved version of the Marketplace was released in June, tweaking the buy/sell flow, reorganizing the interface, and bringing the marketplace in line with the updated Flying Tulip design system. The update also added search by listing and backing capital, refreshed the styling, and integrated the Marketplace into Flying Tulip's main website.

The team is continuing to add requested features, including search by premium and bid notifications. In the meantime, the community-made dashboard lets users search listed PUTs by premium and track activity, while a specialized Discord channel helps the community share the best deals!

Flying Tulip PUT dashboard

Live indexed PUTs listings, premiums, sales, and activity from on-chain marketplace events.

FT Dashboard

What comes next?

The next phase is focused on scaling what is already live while bringing the next parts of the stack to launch. The goal is to increase capital efficiency by standardizing pricing, credit, and risk across a suite of products, while reusing the same collateral across multiple functions.

Each new product adds another layer to the Flying Tulip stack, increasing the utility of the products already live. Capital enters through ftUSD and Lend, which provide the liquidity, settlement, and collateral base. It is then reused across trading and margin flows, and ultimately routes value back through the Flying Tulip token model through FT token buybacks and burns.

Currently, work continues on the hardening of ftUSD and Lend across Sonic and Ethereum, while preparing expansion to additional chains with deep liquidity and stablecoin demand. BNB Smart Chain, second only to Ethereum in DeFi TVL, is the natural next expansion target: it sits inside the broader Binance ecosystem, has one of crypto’s largest retail-facing on-chain user bases, and combines deep exchange-linked liquidity with active stablecoin usage.

Development also continues on the next products in the stack, with the current focus on product optimization and final UX improvements. Spot will first add RFQ-based execution, with CLOB functionality to follow as the order-book layer matures and liquidity increases, while Leverage Trading and TRS extend the same infrastructure into margin and synthetic exposure. The screenshots below show ongoing work on these interfaces.

After that, the roadmap continues.

If you made it this far, join the Flying Tulip Discord for the latest updates and to connect with the community: https://discord.gg/flyingtulip.

Links

Socials

• Website: https://flyingtulip.com
• X/Twitter: https://x.com/flyingtulip_
• Discord: https://discord.gg/flyingtulip

Products

• PUT Marketplace: https://marketplace.flyingtulip.com
• ftPUT: https://flyingtulip.com/allocation/dashboard
• ftUSD: https://flyingtulip.com/ftusd/dashboard
• Lend: https://flyingtulip.com/lend/dashboard

Documentation

• FT Docs: https://docs.flyingtulip.com/product-suite/ft-token
• ftUSD Docs: https://docs.flyingtulip.com/product-suite/ft-usd
• Roadmap: https://docs.flyingtulip.com/roadmap
• Contract addresses: https://docs.flyingtulip.com/contract-addresses

Community Resources

• Supply Dashboard (Tracks FT buybacks, burned, circulating, and non-circulating supply): https://ftdashboard.xyz
• Advanced PUTs Marketplace Dashboard: https://ftdashboard.xyz/puts-marketplace.html
• Circuit Breaker Status + Telegram Alerts: https://ftcircuitbreaker.com
• Sonic/ETH metrics and Borrow-Loop calculator: https://flyingtulip-dash.vercel.app