Bonding is designed as a win-win system for the protocol and its users.
Bonds provide a service to the protocol, attracting and locking up new capital which helps to stabilize and bolster liquidity. In return for their locked investment, users receive higher APYs.
How it works:
- 1.Users choose their bonding period.
- 2.They bond with $DAI and start receiving $USDR at the bonding ROI, vested linearly by block. The bond APY replaces the native USDR APY during the bonding period. (Ex: A 10-day bond returns .3% which is equivalent to a 10.95% APY)
- 3.Once their vesting period is over their investment will continue to accrue the standard USDR APY provided that it’s been staked.
- 4.Users can bond new funds once their bond period has completed.
Note: If you create a new bond of the same lock length while you already have a bond that is vesting, your vesting period is reset to the new bonding period. Users may add a new bond of a different vesting length without resetting active bonds.
Bonding periods and ROIs:
- 10 day: 0.3% ROI (10.95% annualized yield)
- 30 day: 1.1% ROI (13.38% annualized yield)
- 90 day: 5% ROI (20.28% annualized yield)
New bonds can be issued on 10% of market cap of Real USD daily. The daily bond limit will reset daily.
The bonding incentive is issued through the minting of Real USD with TNGBL. If the maximum amount of USDR that can be minted with TNGBL has already been reached, then bonds will be unavailable. They’ll reactivate once new USDR has been minted with DAI, creating space for new TNGBL to be used for minting.