Bonds Mechanism

What are $RBOND (Bonds)?

Bonds are unique tokens that can be utilized to help stabilize $ROCKET price around peg (1 ROCKET= 1 FTM) by reducing circulating supply of $ROCKETif the TWAP (time-weighted-average-price) goes below peg (1 ROCKET= 1 FTM).

When can I buy $RBOND (Bonds)?

$RBOND can be purchased only on contraction periods, when TWAP of $ROCKET is below 1.

Every new epoch on contraction periods, $RBONDs are issued in the amount of 3% of current $ROCKET circulating supply, with a max debt amount of 35%. This means that if bonds reach 35% of circulating supply of $ROCKET, no more bonds will be issued.

Note: $RBOND TWAP (time-weighted average price) is based on $ROCKET price TWAP from the previous epoch as it ends. This mean that $ROCKET TWAP is real-time and $RBOND TWAP is not.

Where can I buy $RBOND (Bonds)?

You can buy $RBONDs if any are available, through rocketfi.xyz, anyone can buy as many $RBONDs as they want as long as they have enough $ROCKET to pay for them.

There is a limit amount (3% of $ROCKET current circulating supply) of available $RBONDs per epoch while on contraction periods, and are sold as first come first serve.

Why should I buy $RBOND (Bonds)?

First and most important reason is Bonds help maintain the peg, but will not be the only measure use to keep the protocol on track. We also have a DAO fund which will step in and buy $ROCKET to get it back to peg.

$RBONDs don't have a expiration date, so you can view them as a investment on the protocol, because longterm you get benefits from holding bonds.

Incentives for holding $RBOND

The idea is to reward $RBOND buyers for helping the protocol, while also protecting the protocol from being manipulated from big players.

So after you buy $RBOND using $ROCKET, you get 2 possible ways to get your $ROCKET back:

1. Sell back your $RBOND for $ROCKET while peg is between 1 - 1.1 (1 ROCKET= 1 FTM) with no redemption bonus. This to prevent instant dump after peg is recovered

2. Sell back your $RBOND for $ROCKET while peg is above 1.1 (1 ROCKET = 1FTM) with a bonus redemption rate

The longer you hold, the more both the protocol and you benefit from $RBOND.

Example:

1. When $ROCKET= 0.8, burn 1 $ROCKETto get 1 $RBOND($RBOND price = 0.8)

2. When $ROCKET= 1.15, redeem 1 $RBONDto get 1.105 $ROCKET($RBOND price = 1.27)

So, which one is better?

If I buy $ROCKET at 0.8, and hold it until 1.15 and then sell, I'm getting +0.35$ per $ROCKET

But, if I buy $ROCKET at 0.8, burn it for $RBOND, and redeem it at 1.15, I'm getting 1.105 $ROCKET* 1.15 ($ROCKET current price) = 1,271 (+0.47$) per $RBOND redeemed.

But what if getting back to peg is taking too long ?

We are going to adjust our use cases, to have different behaviors on contraction and expansion periods to benefit $ROCKET and $RBOND holders when needed.

When can I swap $RBOND for a bonus?

$RBOND TWAP (time-weighted average price) is based on $ROCKET price TWAP from the previous epoch as it ends. This mean that $ROCKET TWAP is real-time and $RBOND TWAP is not. In other words, you can redeem $RBOND for a bonus when the previous epoch's TWAP > 1.1.