🦾Bonds Mechanism
Bonds
WISH(bond tokens) are available for purchase when HOPE falls below the 0.001 ETH peg. If HOPE'S TWAP is between 1.00 and 1.01, neither WISH nor HOPE will be issued.
e.g. if HOPE'S TWAP < 1, exchange HOPE for WISH will be in a 1:1 ratio.
WISH (bond tokens) are available for redemption when HOPE goes above the 0.001 ETH peg.
To encourage redemption of WISH for HOPE when HOPE TWAP > 1.1 and incentivize users to redeem at a higher price, WISH redemption will be more profitable with a higher HOPE TWAP value, of which WISH to HOPE ratio will be 1:R, where R can be calculated in the formula as shown below:
R=1+[(HOPE(twapprice)−1)∗coeff)]
Where coeff = 0.7What are WISH (Bonds)?
Bonds are unique tokens that can be utilized to help stabilize HOPE price around peg (0.001 ETH) by reducing circulating supply of HOPE if the TWAP (time-weighted-average-price) goes below peg (0.001 ETH).
When can I buy WISH(Bonds)?
WISH can be purchased only on contraction periods, when TWAP of HOPE is below 1.
Every new epoch on contraction periods, HOPEs are issued in the amount of 3% of current HOPE circulating supply, with a max debt amount of 35%. This means that if bonds reach 35% of circulating supply of HOPE , no more bonds will be issued.
Note: WISH TWAP (time-weighted average price) is based on HOPE price TWAP from the previous epoch as it ends. This mean that HOPE TWAP is real-time and WISH TWAP is not.
Where can I buy WISH (Bonds)?
You can buy WISH's if any are available, through the BOND on hope finance, anyone can buy as many WISHs as they want as long as they have enough hope to pay for them.
There is a limit amount (3% of Hope current circulating supply) of available WISHs per epoch while on contraction periods, and are sold as first come first serve.
Why should I buy WISH (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, more on that on DAO Fund section here.
WISHs 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 WISH
The idea is to reward WISH buyers for helping the protocol, while also protecting the protocol from being manipulated from big players.
So after you buy WISH using HOPE , you get 2 possible ways to get your HOPE back:
Sell back your WISH for HOPE while peg is between 1 - 1.1 (0.001 ETH ) with no redemption bonus. This to prevent instant dump after peg is recovered
Sell back your WISH for HOPE while peg is above 1.1 (0.001 ETH ) with a bonus redemption rate
The longer you hold, the more both the protocol and you benefit from WISHs.
Example:
When HOPE = 0.8, burn 1 HOPE to get 1 WISH(WISH price = 0.8)
When HOPE = 1.15, redeem 1 WISH to get 1.105 HOPE (WISH price = 1.27)
When can I swap WISH for a bonus?
WISH TWAP (time-weighted average price) is based on HOPE price TWAP from the previous epoch as it ends. This mean that HOPE TWAP is real-time and WISH TWAP is not. In other words, you can redeem WISH for a bonus when the previous epoch's TWAP > 1.1.
Last updated