City Protocol raises $11M to scale on-chain structured products

The capital injection supports a three-layer architecture designed to handle tokenization, vault management, and operational record-keeping. By standardizing these functions through smart contracts, City Protocol allows managers to deploy strategies—such as quantitative hedging, arbitrage, and private credit—without developing custom technical stacks for every new product. The firm’s flagship platform, Venzo, currently hosts four strategy vaults that bring institutional-grade financial products into the on-chain ecosystem.

Beyond managed vaults, the company is developing rule-based thematic portfolios that function directly within user wallets. Unlike pooled vaults where users hold a tokenized share, these portfolios allow investors to retain custody of underlying assets while automated programs execute rebalancing based on public data or sector-specific rules. The move positions City Protocol alongside traditional institutions and platforms like Robinhood, all of which are racing to integrate tokenized equities and structured notes into decentralized finance.

This expansion arrives amid increased regulatory scrutiny regarding the nature of on-chain investment management. SEC Commissioner Hester Peirce has signaled that vault structures—particularly those involving active managerial control or pooled assets—may face classification as investment contracts. As City Protocol scales, its model will need to navigate these evolving compliance demands while providing the automated, transparent infrastructure necessary for the next generation of on-chain finance.