> For the complete documentation index, see [llms.txt](https://docs.prl.one/buttonwood/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.prl.one/buttonwood/learn/tranche.md).

# Tranche

Tranche is a protocol for *stratifying price risk* of crypto-assets. At the core, it allows users to deposit an asset in return for several `Tranche` assets, each representing a different risk level. The safer assets have relatively stable value, while the risky assets have value roughly equivalent to a leveraged position of the underlying asset.&#x20;

![](/files/dz1OK2T7OiHjLCIBazKY)

The following sections will explain how this mechanism works and why it's useful.&#x20;