# Introducing 3Jane By [3Jane ](https://paragraph.com/@3jane) · 2024-04-18 --- 3Jane is a crypto-native derivatives protocol built on restaking and cash-and-carry. At its core, 3Jane revolutionizes the way Ethereum is utilized by enabling the _collateralization_ of cryptoeconomic security of _any_ Proof-of-Stake (PoS) based system in derivatives contracts. This approach maintains the security of these systems whilst weaving them seamlessly into a vibrant derivatives market. Through composability, 3Jane unlocks the potential to generate substantial yield from options contracts all while contributing to the overarching security and robustness of the crypto economy. ### **State of the Space** We are witnessing a cambrian explosion in crypto-native yield-bearing assets enabled by EigenLayer’s restaking primitive. At time of writing, **14%** of all staked ETH has been restaked equating to **$14B** TVL from native/liquid restaking. ![](https://storage.googleapis.com/papyrus_images/c97451f8dc99ba2989c24cd32035eece6d87f61146fe9d18fa84ca200553b7f3.png) In 2023, there was effectively **1** PoS yield source between ETH and BTC — you can stake your ETH on the Beacon Chain. Today, staked ETH and BTC can be re-pledged across an **infinite** number of cryptoeconomic systems and by doing so one can earn more yield in exchange for providing security. Specifically, this scales with the number of Actively Validated Services ([AVS](https://docs.eigenlayer.xyz/eigenlayer/avs-guides/avs-developer-guide#what-is-an-avs)’s) live on EigenLayer (ETH) and the number of PoS chains live on [Babylon Chain](https://babylonchain.io/learn) (BTC). As a result, you can have an **infinite** number of yield-bearing ETH and BTC variants with varying yield / risk profiles. #### **Ethereum** ETH security can now not only be used to secure ETH mainnet, it can now be re-pledged to secure AVS’s such as sidechains, data availability layers, new virtual machines, keeper networks, oracle networks, bridges, threshold cryptography schemes, trusted execution environments, etc. [Operators](https://docs.eigenlayer.xyz/eigenlayer/operator-guides/operator-introduction#what-is-a-node-operator-within-eigenlayer) secure AVS applications by running their software and in return receive AVS rewards. Operators are subject to slashing conditions of each AVS that it is securing. Let’s imagine a scenario where there are 2 Operators {O1, O2} and 3 AVS’s {A1, A2, A3} live on EigenLayer. The _power set_ of AVS’s represents all the possible combinations of AVS software that a Node Operator may run simultaneously, ranging from 1 AVS (isolated security) to all 3 AVS’s (pooled security). As a result, there are 7 (2³ — 1) possible combinations per Operator, and 14 in total between O1 and O2. Note that an Operator re-pledges the same ETH delegated to it across every AVS that it is running simultaneously. So, in this example with just 2 Node Operators and 3 AVS’s we have effectively gone from **1** asset (staked ETH) to **14 yield-bearing exotic variants** of ETH, all with their own risk profile and importantly **yield** profile from each AVS. ![](https://storage.googleapis.com/papyrus_images/396ab11de5e61eb1c4eb7d7414ae827c1e00b8551e382fb0d22286ca2ac0a213.png) Now, scale this to the current number of Node Operators (P2P, Chorus One, EtherFi, 01 Node, Ankr, etc.) and current number of AVS’s (EigenDA, Ethos, Lagrange, Espresso, Fhenix, etc.) and we get **thousands** of possible {Node Operator, AVS\_1, …., AVS\_n} combinations. Granted, in reality the only combinations are whatever each subset of AVS’s each Node Operator decides to run. #### **Bitcoin** Similar to EigenLayer with ETH assets, BTC can now be used to secure other PoS Chains through Babylon Chain. This enables staking idle BTC towards securing alternate PoS chains and earning yield. Babylon allows you to lock directly on the Bitcoin network and leverages extract one-time signature (EOTS) to enforce slashing. As a result, BTC holders can also stake and earn yield and get exposure to different risk profiles/ APR’s depending on what it is securing. #### **Stablecoins** Whereas EigenLayer allows users to access yield through proof-of-stake rewards, Ethena has built an on-chain vehicle for capturing cash-and-carry (long ETH spot, short ETH perpetuals) yield giving users upwards of 20% APY. sUSDe is yet another novel crypto-native yield-bearing asset. ### **Enter 3Jane** ![](https://storage.googleapis.com/papyrus_images/6ff3fcac1daf09d77c64508e4dde086bb2a3ca3d478517841e83f55b74cff92b.jpg) 3Jane is a crypto-native derivatives protocol leveraging restaking and cash-and-carry to unlock a _novel layer of derivatives yield_. 3Jane enables the _collateralization_ of all exotic yield-bearing ETH and BTC variants across EigenLayer, Babylon Chain, and Ethena, in _options contracts_, encompassing a market size of approximately $17.5 billion (and growing) at time of writing. Options contracts are a type of derivative that grants options buyers access to leverage in crypto without getting liquidated, unlike perpetuals. However, just like perps traders must pay a _funding rate_ to be able to trade on leverage, options buyers must pay something equivalent to options sellers called a _premium_ to get access to leverage. As a result, selling options is commonly used as a way to earn yield by collecting _premiums_ in exchange for taking on a short volatility position. Options are a multi-trillion dollar market in traditional finance. Selling options is **not** a risk-free strategy. Read more [here](https://workplace.schwab.com/content/options-strategies-covered-calls-covered-puts). Users will be able to execute the cash-and-carry as well secure other PoS-based chains, data availability layers, shared sequencer marketplaces, ZK / FHE co-processors, TEE committees, etc and _collateralize_ those positions in a robust derivatives market. As a result, users can earn an additional yield of up to **40% APY** on their natively restaked ETH, eETH, ezETH, rswETH, and sUSDe by selling options contracts and collecting _premiums_. **ETH Buy&Hold:** 0% yield **Stake on Lido:** +x% staking yield **Restake on EigenLayer:** +y% restaking yield **Collateralize on 3Jane:** +z% options yield Mainnet coming soon. Follow the 3Jane protocol [twitter](https://twitter.com/3janexyz) and join the [telegram](https://t.me/three_jane)! * * * _3Jane will_ **_not_** _be offered to persons or entities who are U.S. Persons, Restricted Persons, or Sanctioned Persons. Access and use by such persons is expressly prohibited._ --- *Originally published on [3Jane ](https://paragraph.com/@3jane/introducing-3jane)*