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🪢Bonding
Bonding (shortened as B) is a mechanism of liquidity accumulation by 𝔾ℂ DAO 🏛 through selling GTON to potential holders with a discount. Some specific features of GTON Capital bonding mechanism are described below.
What is Bonding in GTON Capital?
- Bonding is a GC DAO revenue generation protocol and the main source of AMM liquidity for GTON (POL, protocol owned liquidity).
- A buyer interacts with a smart contract to buy a locked GTON allocation.
- The locked allocation is stakable to make B attractive, therefore Zap-Bonding-Staking (ZBS).
- Bonding is a fundamental factor for 🧬PW because it attracts new liquidity to AMMs and pushes PWPeg up.
What are Bonding parameters?
There are two types of Bonding:
- 1.Short-term Bonding (STB)1 week lock (~7 days) with daily linear unlock starting from +1 day after lock tx. Discount Rate is 7%. Permissionless.
- 2.Mid-term Bonding (MTB) 3 months lock (~90 days) with daily linear unlock started from +1 day after lock tx. Discount Rate is 15%. Permissionless.
How big is the Bonding allocation?
- According to the 🧬PW v1.x DAO vote, we agreed to have ~25% circulating supply at the end of the period (20 epochs). Therefore, the circulating supply will be 0.25·21mln = 5.25mln GTONs. 25% of this amount can be released in the form of staking rewards. So, 1.3 mln from that is allocated for 🪙Staking, which means we can set up 5.25 - 1.3 - 2.1 = 1.85 mln (~9% supply) GTONs for Bonding.
- STB allocation is 1.2 mln GTONs (~2/3 of Bonding Alloc) and BTB is 0.65 mln GTONs (~1/3 of Bonding Alloc).
Where do the numbers come from for 🪢Bonding?
- OlympusDAO discount rates and vesting is used as a reference.
- Those discounts are correlated with weekly and monthly volatility for GTON.
What are the features of ZAP (ZBS, Zap-Bonding-Staking)?
All GTONs locked via Bonding also automatically generate APY from staking.
What is more profitable, Bonding or Staking?
Bonding will be more profitable than staking at some point
However, STBs are restricted in terms of amount and “bond sale” campaign time limits.
If bond sales events only happen once per 2 months, it only yields 42% ROI in GTON.
For MTBs, there are no time limits since it is only possible to repeat it 4 times, which is 4*15 = 60% ROI in GTON.
Therefore, there are 3 strategies:
⚜️ Buy and stake: 23% APR (25 APY with compounding)
⚜️ Active 7d re-bonding: ~45% ROI
⚜️Active 3m re-bonding: ~63% ROI
Different strategies have different pros/cons, but they all are needed to generate revenue for 𝔾ℂ DAO 🏛.
Last modified 3mo ago