First-loss capital & Insurance

First-loss capital absorbs losses before other lenders are affected. Tydro lets institutions post it verifiably in markets to provide coverage for their depositors

How it works

A first-loss provider commits capital that sits at the bottom of the loss waterfall. If a covered position takes a loss, the first-loss capital absorbs it before any senior lender or depositor is touched. The coverage is posted on-chain, so depositors can verify it exists and see its size rather than relying on an assurance.

For a manager, first-loss capital is how you stand behind your own strategy. By posting it, you give your depositors verifiable protection and, in return, hold the position that carries the higher yield for taking on that risk.