structured products
Vision
Parthenon Fi's long-term vision extends beyond plain loans to enable on-chain structured products issued natively for RWA assets. This enables investors to invest across the capital stack while maintaining privacy when trading on the secondary market.
Structured products represent the evolution from bilateral lending (Module 2 launch) to capital markets infrastructure — where Parthenon becomes the platform for issuing, managing, and trading the full range of institutional credit instruments.
Planned Product Types
Mezzanine Debt
Subordinated debt positioned between senior secured debt and equity in the capital stack. Mezzanine facilities on Parthenon would:
Offer higher yields than senior tranches, reflecting subordination risk
Be represented as LPTs with embedded subordination logic
Allow investors to take targeted exposure to specific risk/return profiles
Use Canton's privacy to shield tranche pricing and investor composition
Preferred Equity
Equity-like instruments with debt-like cash flow characteristics. On Parthenon:
Fixed dividend payments encoded in the LPT
Priority over common equity in liquidation waterfall
Convertibility features where applicable
Custodian-held underlying assets with defined distribution mechanics
Commodity-Backed Facilities
Leveraging DMCC FinX integration for commodity tokenization:
Trade finance facilities backed by tokenized gold, oil, or agricultural commodities
DMCC-VARA regulated tokenization pipeline (October 2025 partnership)
Custodian holds tokenized commodity receipts as collateral
LTV parameters calibrated to commodity price volatility
Credit Tranching
A single pool of collateral supporting multiple tranches with different risk/return profiles:
Senior tranche: First claim on collateral. Lower yield, higher safety.
Mezzanine tranche: Second claim. Moderate yield and risk.
Junior/equity tranche: Last claim. Highest yield, absorbs first losses.
Each tranche is represented by a distinct LPT with embedded waterfall logic governing payment priority and loss allocation.
Architecture Requirements
Structured products require extensions to the Module 2 architecture:
LPT
Embedded subordination and waterfall logic. Tranche identifiers.
TICS
Multi-tranche collateral allocation and distribution mechanics.
GMSLA
Intercreditor provisions governing tranche priority.
Orderbook
Tranche-specific trading markets with risk-adjusted pricing.
Oracles
Commodity price feeds (DMCC FinX) alongside crypto feeds.
Regulatory Considerations
Structured products introduce additional regulatory complexity:
ADGM: May require "Managing Assets" FSP category (beyond "Arranging Deals")
US: Structured credit instruments may implicate SEC securities registration; Regulation D (Rule 506) exemption applies for institutional-only distribution
Canton: Sub-transaction privacy enables compliance with confidentiality requirements for structured product investors