User:Stillmee777/sandbox

= Bonds = For a better understanding of the following section, the reader is advised to read the bonding explanation at OlympusDAO.

In 2021, OlympusDAO introduced bonds and protocol-owned liquidity concepts. Convergence uses 30% of  total supply to sell bonds, incentivizing users to provide various assets while allowing the protocol to own its liquidity and build a treasury.

However,  is not a decentralized reserve currency. does have a maximum supply, and its treasury will not serve any purpose of backing or risk-free value (RFV). As a result, Convergence’s treasury should not be considered as any form of guarantee for ’s price.

= Understanding Bonds = Convergence’s bonding model is slightly different from Olympus’s one. Bonds will have a modulable vesting term, a maximum ROI, and a minimum ROI (fixed range). Bond prices will be calculated thanks to an ad-hoc on-chain oracle that gets bonded assets' prices over various AMMs.

Bonding rounds will be set to control the inflation resulting from bonds. A bonding round will last three months, and 2,000,000  will be available to sell during that time. If all  are sold before the end of a given bonding round N, users will be able to bond again at the beginning of the bonding round N +1. The bond program is planned to last for approximately four and a half years and to sell a maximum amount of 40,000,000.

Bonding round distribution (amount of  sold for each stablecoin or asset) will be set before the beginning of each bonding round. Multiple scenarios will be established for bonding round N + 1 at the beginning of bonding round N.

8,000,000  will remain unplanned in the bond program as a strategic elastic reserve. This reserve will allow Convergence to deploy bonds anytime, preventing the protocol from being out of available bonds when  's price action is favorable.

= Oracles and ROI computation = To compute bonds price, Convergence bonds embed a tailored, generic on-chain Oracle called. The  can get bonded assets price from multiple AMMs (Uniswap V2&V3, Sushiswap, Curve...) and is called each time a user buys a bond.

When a bond is deployed, the most liquid pools are targeted by the  (the team will manually set up each bond parameter).

Convergence bonds also include an additional security check based on Chainlink Price Feeds. Each time a user buys a bond, after the  returns a price, this price is compared to the corresponding asset price given by. The transaction will fail if the price difference between both Oracles exceeds a given percentage.

This security check has been implemented to prevent Convergence bonds from being "exploited" by someone manipulating an underlying pool while allowing the bonding mechanism to function properly during volatility periods.

Once both Oracles returned a corresponding price, the discount (ROI) that the bond buyer will get is computed with a mechanism that considers the previous buying activity and the expected buying activity.

= Tokenized bonds = Just like staking and locking, bonding positions are also tokenized. When a user buys a bond, his bonding position is represented by an  . This   will be burned once the full   amount has been redeemed.

Users may iterate on an existing bonding position or create a new one at any time. However, iterating on an existing position (increase the amount of bonded asset and thus increase the amount of   that can be redeemed) will reset the vesting term.

Like other Convergence's financial   (staking and locking), bonding   can be traded and/or sent to another wallet. Thus, each   has a “lock” function that forbids its owner to redeem   once triggered. The purpose of this function is to ensure that bonding   buyers won't be frontruned and receive an empty  .