Perpetual futures have become crypto’s default way to trade with leverage. Andre Cronje’s Flying Tulip thinks an old Wall Street instrument could offer traders another option, potentially with cheaper financing.
The platform has launched Trade, its spot and leveraged spot engine, alongside Total Return Swap, or TRS. Both are now live on Ethereum and Sonic and plug into the same non-custodial margin account already used by Flying Tulip’s lending layer.
That shared account is central to the pitch. Instead of moving capital between lending, spot and derivatives protocols, the same collateral can support loans, resting orders and leveraged positions. Assets can also continue earning inside the account while an order waits to execute.
Flying Tulip Wants Your Capital Doing More Than One Job
Trade starts with familiar territory. Users can buy and sell supported assets through market and limit orders, with estimated execution, fees and slippage displayed before confirmation.
Leveraged spot is where the structure becomes more interesting. Flying Tulip uses actual borrowing rather than creating a synthetic position. A trader’s collateral supports a loan, the borrowed asset is exchanged through RFQ execution, and the asset purchased is deposited back into the same account as collateral.
The trader therefore owns the asset while carrying the corresponding debt. When the position closes, the asset is sold, the loan is repaid and the remaining capital stays in the account.
The current leveraged markets are limited to assets that Flying Tulip’s Lend system can safely borrow or accept as collateral. Its roadmap, however, includes permissionless lending markets automatically created from AMM pairs, which could eventually open leverage to a much wider range of assets.
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TRS is the more unusual addition.
Total return swaps have been used for years by hedge funds and other institutional investors to gain exposure to an asset without owning it directly. Flying Tulip is adapting the structure for onchain markets, letting traders choose an underlying asset, go long or short, select collateral and add leverage.
What makes that interesting for crypto traders is the financing.
Perpetual futures rely on recurring funding payments between longs and shorts to help keep the contract aligned with spot. Flying Tulip instead calculates TRS financing using collateral yield and the actual cost of borrowing.
Cronje argues that can materially reduce the cost of maintaining a leveraged position.
“Total return swaps are the instrument most traditional financial institutions use to get the same kind of exposure a perpetual allows. Same leverage, same capital efficiency, but funding is often a lot cheaper. Your funding is actually the delta of your borrowing cost,” said Andre Cronje, founder of Flying Tulip.
Flying Tulip lays out the comparison with perpetuals in more detail in its TRS launch announcement.
Liquidations Get an RFQ Too
Flying Tulip is also taking a different approach to what happens when leverage goes wrong.
Risk is measured across the entire margin account, including collateral, debt and profit and loss, rather than treating every position as a separate island. There is no auto-deleveraging as long as the account continues meeting its margin requirements.
If liquidation becomes necessary, Flying Tulip sends out RFQs and accepts the best available bid rather than automatically handing collateral to a liquidator at a predetermined discount.
That makes executable liquidity especially important. A reference price may say what an asset is worth, but during a stressed market the price somebody is actually willing to pay matters more. Flying Tulip’s risk documentation goes deeper into how the system handles those conditions.
The Bigger Bet Is One Onchain Financial Account
Trade and TRS are pieces of a broader attempt to put more of a trader’s financial activity onto one balance sheet. ftUSD handles liquidity and settlement, Lend provides credit and collateral, Trade handles execution, and TRS adds synthetic exposure.
A fully onchain central limit order book is also being hardened. Once live, orders could execute through the AMM, the order book or both depending on where the best price is available.
Further out, Flying Tulip’s permissionless trading roadmap includes automatically created lending markets, a volatility-adaptive AMM and permissionless futures and options.
For traders, the immediate experiment is simpler. Flying Tulip is asking whether one pool of collateral can do more work, and whether crypto leverage needs to revolve around perpetual futures at all.
If TRS can deliver similar exposure with meaningfully lower financing costs, a product borrowed from traditional finance could end up being one of the more interesting parts of Cronje’s new onchain stack.