City Protocol Raises $11M to Bring Structured Investment Products Onchain

By Lidia Yadlos

City Protocol has raised $11 million to build what it believes is still missing from onchain finance: the infrastructure for turning sophisticated investment strategies into products that can be easily launched and distributed.

The seed and Pre-A rounds attracted Dragonfly, Jump Crypto, CMT Digital, Stratified Capital, Adaverse and Mirana, backing City Protocol's effort to build a standardized technology stack for structured investment products.

The company is already putting that infrastructure to work through Venzo, its flagship investment platform. Venzo currently has four strategy vaults with a combined $30 million in TVL, offering exposure to strategies including quantitative hedging, cross-exchange arbitrage, private credit and onchain yield.

Now City Protocol is preparing to expand the model with non-custodial Thematic Portfolios, while opening its infrastructure to asset managers and strategy providers that want to launch products of their own.

Building the Infrastructure Behind Onchain Investment Products

Creating a structured investment product involves much more than developing the underlying strategy. Issuers also need infrastructure for custody, execution, accounting, valuation, operations and distribution.

Moving the product onchain does not automatically solve that problem. Those functions can remain scattered across different protocols and systems, leaving teams to assemble much of the infrastructure themselves.

City Protocol is building a reusable stack designed to handle that process through three modules:

• Tokenization: Turns an investment strategy or asset class into a verifiable, distribution-ready onchain product.
• Vault: Uses pre-audited smart contracts to manage deposits, withdrawals, execution limits, accounting and exits.
• Issuance & Operations: Provides templates covering the product lifecycle from launch through maturity.

For asset managers, the idea is to make launching an onchain product closer to plugging into existing infrastructure than building a new financial platform for every strategy.

The system also separates permissions across different roles, requires multiple signatures for privileged actions and records fee structures directly in smart contracts. Positions and execution records remain verifiable onchain.

Venzo Already Holds $30 Million

Venzo shows what that infrastructure looks like as an actual investment product.

Its four live Strategy Vaults currently hold $30 million in TVL across EVM-compatible networks. Chain abstraction gives users a unified experience across networks, while the underlying products can connect with decentralized lending, execution and yield protocols.

The vaults package strategies that can otherwise be difficult for individual investors to access, including quantitative hedging, cross-exchange arbitrage, private credit and onchain yield.

Users subscribe to a vault while the strategy provider manages the capital within a predefined mandate. Performance is tracked through net asset value, with redemptions handled according to each product's terms.

City Protocol is also making the infrastructure available beyond Venzo through an SDK and portfolio data interfaces, allowing other platforms to integrate its vault products into their own applications.

Thematic Portfolios Are Coming Next

Venzo's next product takes a different approach.

Thematic Portfolios will create rules-based baskets around specific investment ideas while keeping the underlying assets in the user's own wallet. There is no pooled fund or NAV structure. Instead, automation handles purchases and rebalancing according to rules published in advance.

The initial lineup will include:

• People Trackers: Portfolios based on lawfully disclosed holdings of prominent investors, institutions and public officials, updated as new disclosures become available.
• Sector Themes: Portfolios centered on industries such as space, metals and electric vehicles.

Users will own the underlying assets directly and can dispose of their positions at any time. Published construction and rebalancing rules are intended to make thematic investing possible without requiring users to research every constituent, execute each trade or continually adjust portfolio weights themselves.

Venzo is also running its inaugural Polis Points season. Users earn points by holding eligible positions in registered vaults, with additional multipliers tied to factors including vault participation, position size, genesis status and loyalty. Referrals can generate additional points, and a second season is planned.

$11 Million to Expand the Model

The new funding gives City Protocol additional capital to expand both the infrastructure layer and the products built on top of it.

The project already counts more than 51,000 verified City ID users and 9,400 ecosystem NFT holders, alongside the $30 million currently held in Venzo vaults.

City Protocol's larger bet is that structured products could become a much bigger category in onchain finance as the infrastructure required to create them becomes standardized.

Quantitative strategies, arbitrage and private credit have traditionally reached investors through specialized funds and financial institutions. Putting the infrastructure onchain creates another distribution route, while modularizing it could allow more strategy providers to package and launch products without building every component themselves.

That is where the $11 million raise becomes more significant than simply funding another DeFi platform. City Protocol is trying to build the underlying rails that other asset managers, strategy providers and financial platforms can use to bring their own investment products onchain.

Published on Dragonfly

City Protocol Raises $11M to Bring Structured Investment Products Onchain