Tranchess Protocol, a chess-themed decentralized finance (DeFi) asset management platform, has raised $1.5 million in a seed round of funding that was led by Three Arrows Capital and Spartan Group.

Other notable investors include Binance Labs, Longhash Ventures, IMO Ventures and key opinion leaders who wish to remain anonymous, according to a press release on Monday.

Money raised will go toward furthering the project's expansion and aspirations of becoming a multi-chain system while completing the development of its decentralized autonomous organization (DAO).

Tranchess, which has been under development for almost a year, launched June 24 on Binance's Smart Chain — an ecosystem designed for budding DeFi apps running smart contracts.

In essence, the protocol seeks to provide a risk/return matrix from a single main fund, known as Queen, that tracks a specific underlying crypto asset.

The protocol has begun by tracing bitcoin's movements, with a goal of adding more assets in the future. The fund will attempt to serve a variety of clients with different tolerances for risk, as a user may split his or her fund into two sub-funds, Rook and Bishop, the press release stated.

Bishop is a "yielding" tranche that has no exposure to bitcoin's price, while the Rook fund is a "leveraged" tranche that has twice the exposure to price movements in the underlying crypto.

Once a user splits up his Queen fund into these sub-funds, that user can then sell one fund instantaneously, leaving him with either fixed income or leveraged exposure to bitcoin, a spokesperson for the project told CoinDesk via Telegram.

"The main fund, Queen, currently tracks bitcoin and can be split into 0.5 Bishop tokens and 0.5 Rook tokens," the spokesperson said."Bishop tokens purely earn more yield and does not track bitcoin at all, while Rook tokens earn smaller yield but are essentially a 2x leverage token for bitcoin."

Its chess-inspired theme borrows from some concepts of the game, including implementing game theory of the Bishop interest voting system, which allows users to vote on how much interest the fund will generate. Meanwhile, the governance token – used to cast votes and make decisions regarding the protocol – is named Chess.

"We believe the yields offered to both bitcoin and stablecoin-denominated investors via this unique way of matching will find tremendous product-market fit,” said Su Zhu, co-founder of Three Arrows Capital.

The project said it was aiming to hand over management of the protocol to the DAO by the fourth quarter of this year along with accompanying 2.0 apps.