YZi Labs Invests in TermMax to Build On-Chain Fixed-Income Infrastructure

YZi Labs has made a strategic investment in TermMax, a decentralized finance protocol focused on building fixed-income market infrastructure for on-chain assets. The move, announced on August 26, aims to develop more sophisticated financial services, such as credit and risk management, for the rapidly growing tokenized securities market.

Strategic Investment Details

The financial terms of the investment were not disclosed. TermMax, built by Term Structure Labs, was a participant in YZi Labs’ EASY Residency Season 3 incubation program and has raised more than $8 million to date, according to the announcement. The protocol's earlier backers include Cumberland DRW, which led its 2023 seed round, as well as HashKey Capital, Decima Fund, and MZ Web3 Fund.

Bridging a Gap in On-Chain Finance

The investment addresses what YZi Labs described in an August 14 post as an underdeveloped financial layer for tokenized assets. While tokenized blue-chip equities have reached significant volume, the firm noted a lack of infrastructure for credit, collateral management, and risk-transfer products like options. TermMax aims to build that missing infrastructure, with a goal of establishing an on-chain interest rate curve.

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"When I left banking, there were a few hundred billion dollars of assets sitting on-chain without a single directly observable interest rate curve between them," said Jerry Li, Co-founder and CEO of TermMax. "In traditional markets, that would be unheard of. That is what made me decide to build this infrastructure on-chain." The market for tokenized equities currently stands at $2.48 billion and has seen its holder count grow 165% in the last 30 days, the release stated.

Protocol Features and Market Position

Since its mainnet launch in April 2025, TermMax has deployed across 10 EVM-compatible chains, supporting 60 fixed-rate markets. The protocol allows users to borrow at fixed rates against tokenized U.S. equities, including ETFs like QQQ and SPY on the Robinhood Chain, following an integration in August.

A key feature is its approach to risk management. The protocol's upcoming TermMax Alpha platform will offer physical delivery options that cannot be liquidated before expiry, a design intended to be more suitable for thinly traded tokenized assets than perpetual futures. All liquidations on the protocol settle via physical delivery, where collateral is transferred directly to the lender rather than being sold on the open market, mitigating price impact. The protocol holds a DeFiSafety Process Quality Review score of 93%, matching that of Aave V3.