Project Research Dossier: NUNCHI — The Yield Layer of the Internet

Project Status: Pre-TGE / Testnet Season 1 / Points Campaign (cHIPs™) Ecosystem Alignment: Hyperliquid (HIP-3), Ethena (USDe)

1. Project Goal: The On-Chain Interest Rate Primitive

NUNCHI is architecting the Yield Layer of the Internet, a decentralized perpetuals exchange (YEX) designed specifically for trading interest rates and yield-bearing assets.1 Operating on the Hyperliquid Layer 1 via the HIP-3 framework, it seeks to bridge the gap between DeFi native yields and the global macro rates market.

Core Infrastructure:

• Yield Perps (YPs): Allow users to trade the annualized yield of an asset (e.g., stETH staking yield, funding rates) to manage cash flow risk.

• Basis Perps (BPs): Track the price ratio of a yield-bearing asset against its base to manage principal risk.

• nHYPE: A liquid staking token (LST) used to syndicate the mandatory $500,000$ HYPE bond required for HIP-3 market deployment.

Market Significance: NUNCHI transforms yield from a passive reward into a liquid, tradable asset class. This enables institutional-grade strategies, such as hedging against funding rate compression or speculating on Treasury bill yields, directly on-chain.

2. Tokenomics: Pre-TGE Capital Coordination

NUNCHI is currently in a pre-token phase, utilizing the cHIPs™ Game—a cooperative capital strategy to bootstrap liquidity and meet network requirements.

Valuation and Funding

• Current Valuation: $$1,000,000,000$ (Extended Seed round as of November 20, 2025).

• Backing: Formally backed by Anchorage Digital.

• Quote Asset: All NUNCHI pairs are denominated in USDe (Ethena’s synthetic stablecoin) to align yield incentives.

Emissions Model (The cHIPs™ Pool)

The protocol distributes a fixed budget of $250,000,000$ cHIPs weekly. Individual rewards are calculated as:

$\text{Epoch Share} \times \text{accrued bonuses}$.1

3. Unlock + Dilution Risk

As the protocol is pre-TGE, "dilution" currently manifests as the expansion of the cHIPs supply and structural capital locks.

• Scale-Back Mechanism: This is the protocol’s primary defense against mercenary capital. If a user withdraws from the nLP vault or nHYPE bond before the HIP-3 mainnet launch, their earned cHIPs are reduced proportionally to the amount withdrawn (e.g., a $50%$ withdrawal results in a $50%$ cHIP loss).

• The Bond Floor Risk: To operate HIP-3 markets, NUNCHI must maintain a permanent bond of $500,000$ HYPE.4 Consequently, stakers can only withdraw HYPE that exists above this $500,000$ floor.

• Points Inflation: With $250$ million cHIPs emitted weekly, the total supply will reach approximately $13$ billion annually.1 Investors must monitor the eventual conversion ratio of cHIPs to the native governance token to assess FDV dilution.

• Withdrawal Delay: All capital exits are subject to a 7-day countdown.

4. Team Verification Signals

The project exhibits high-signal institutional alignment despite the core team operating under the collective pseudonym "The Nunchi Team".

• Institutional Lead: Anchorage Digital (a federally chartered crypto bank) is a lead investor and strategic partner, providing significant technical and regulatory credibility.

• Ecosystem Alliances: NUNCHI has formalized partnerships with Ethena Labs (providing 20x rewards to nHYPE stakers), Delpho Labs (as a risk layer for USDV), and utilizes Pyth Network and SEDA for global rate oracles.

• Technical Verification: The protocol utilizes Hyperliquid’s CoreWriters to interact with the perps engine and maintains integration with the CCXT library.

• Ecosystem Sentiment: NUNCHI is recognized as a pioneering "Builder Market" within the Hyperliquid community.

5. Key Risks

• Technical (Oracle Basis Risk): Yield and interest rate markets are highly sensitive to latency. Any delay in oracle feeds (Pyth/SEDA) during volatile macro events could lead to significant price deviations (basis risk) or unfair liquidations.

• Execution (Bond Threshold): If the price of HYPE drops significantly or stakers withdraw excess capital, the protocol may fall below the $500,000$ HYPE bond required by HIP-3, leading to the suspension of its perpetual markets.

• Governance: During the pre-TGE and testnet phases, parameters such as yield curves and incentive weights are managed by the team without a decentralized voting mechanism.

• Incentives: The large weekly emission of cHIPs may lead to an "overhang" where the market value of the points at TGE is lower than participants' expectations.

6. Disclosure

Position: No position. I am not currently staked in nHYPE or providing liquidity to the nLP vaults. Incentives: I have no financial relationship with the NUNCHI team, Anchorage Digital, or Hyperliquid. This dossier is for research purposes only as part of the Architect of Value mission.