Tranchess Rebalancing Explained Simply
2 min read
Why and how Tranchess rebalances ROOK leverage instead of liquidating positions.
Why rebalancing exists
ROOK's leverage changes as the price of the underlying moves. If it drifts too far up or down, the protocol resets the ratio of BISHOP and ROOK to keep the system healthy.
What happens to holders
During a rebalance, balances are adjusted so value is preserved but leverage returns to its target. This replaces liquidation. See tranches and risks.
Independent educational resource, not affiliated with Tranchess. Nothing here is financial advice. Crypto assets are volatile — do your own research.
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