Profit from $UBOND and help get $UNITE back to peg at https://unitefinance.io/bond
Come to the rescue of Unite and get it back to peg while making a healthy lucrative profit!
UBonds are sold by the protocol when the UNITE price is under peg of 1 ONE. Bonds can be purchased as “UNITE at a discount” since bonds can be redeemed back to higher UNITE price once it reaches peg. All Unite used to buy UBONDs is burned to help reduce supply. UBOND holders are incentivised to hold their token longer as the reward (in UNITE) increases quadratically with price movements.
What are UBOND (Bonds)?
Bonds are unique tokens that can be utilized to help stabilize UNITE price around peg (1 UNITE = 1 ONE) by reducing circulating supply of UNITE if the TWAP (time-weighted-average-price) goes below peg (1 UNITE = 1 ONE).
When can I buy UBOND (Bonds)?
UBOND can be purchased only on contraction periods, when TWAP of UNITE is below 1.
Every new epoch on contraction periods, UBONDs are issued in the amount of 1.5% of current UNITE circulating supply, with a max debt amount of 45%. This means that if bonds reach 45% of circulating supply of UNITE, no more bonds will be issued.
To encourage redemption of UBOND for UNITE when UNITE TWAP > 1.1 and incentivize users to redeem at a higher price, UBOND redemption will be more profitable with a higher UNITE TWAP value, of which UBOND to UNITE ratio will be 1:R, where R can be calculated in the formula as shown below:
Where coeff = 0.7
Note: UBOND TWAP (time-weighted average price) is based on UNITE price TWAP from the previous epoch as it ends. This means that UNITE TWAP is real-time and UBOND TWAP is not.
Where can I buy UBOND (Bonds)?
You can buy UBONDs if any are available, anyone can buy as many UBONDs as they want as long as they have enough UNITE to pay for them.
There is a limited amount (3% of UNITE current circulating supply) of available UBONDs per epoch while on contraction periods, and are sold as first come first serve.
Why should I buy UBOND (Bonds)?
First and most important reason is Bonds help maintain the peg, but will not be the only measure used to keep the protocol on track. We also have a DAO fund which will step in and buy UNITE to get it back to peg.
UBONDs don't have a expiration date, so you can view them as a investment on the protocol, because long-term you get benefits from holding bonds.
Incentives for holding UBOND
The idea is to reward UBOND buyers for helping the protocol, while also protecting the protocol from being manipulated from big players.
So after you buy UBOND using UNITE, you get 2 possible ways to get your UNITE back:
Sell back your UBOND for UNITE while peg is between 1 - 1.1 (1 UNITE = 1 ONE) with no redemption bonus. This to prevent instant dump after peg is recovered
Sell back your UBOND for UNITE while peg is above 1.1 (1 UNITE = 1 ONE) with a bonus redemption rate
The longer you hold, the more both the protocol and you benefit from UBOND.
When UNITE = 0.8, burn 1 UNITE to get 1 UBOND (UBOND price = 0.8)
When UNITE = 1.15, redeem 1 UBOND to get 1.105 UNITE (UBOND price = 1.27)
So, which one is better?
If I buy UNITE at 0.8, and hold it until 1.15 and then sell, I'm getting +0.35$ per UNITE
But, if I buy UNITE at 0.8, burn it for UBOND, and redeem it at 1.15, I'm getting 1.105 UNITE* 1.15 (UNITE current price) = 1,271 (+0.47$) per UBOND 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 UNITE and UBOND holders when needed.
Note: For redemption of bonds, there are two requirements: The last hour TWAP is >1.01, and with the "Treasury" at 0xb5024ff84046459Dd8474077e6072A05E34E82cd has enough UNITE balance (which is emitted in boardroom when above peg) to support the transactions & exchange of UBOND for UNITE.
The current Treasury unite balance will be available on the bonds page at unitefinance.io/bond for better understanding of the amount of bonds which can be redeemed. New UNITE are added to Treasury every epoch (similar to boardroom) so this value will constantly update.
When can I swap UBOND for a bonus?
UBOND TWAP (time-weighted average price) is based on UNITE price TWAP from the previous epoch as it ends. This mean that UNITE TWAP is real-time and UBOND TWAP is not. In other words, you can redeem UBOND for a bonus when the previous epoch's TWAP > 1.1.