A major innovation in the cryptocurrency ecosystem! Eternity Cloud introduces Bonds, providing a new source of funding for Web3 project owners. For investors, this is a new way to make money through cryptocurrencies. What are these bonds? And how do these bonds work? The answer is:
Reserve Bond: What is it?
Reserve bonds are financial instruments aimed at providing projects with an alternative solution to create sustainable liquidity. These instruments allow investors who believe in the project to profit by purchasing tokens at an initial price lower than the market price. The goal of this innovative initiative is to ensure that projects enjoy long-term health by diversifying funding sources. The benefit for investors is that the prices of these reserve bonds fluctuate depending on market conditions and the value of the underlying tokens.
Reserve bonds: how do they work?
As soon as a user purchases a bond, they receive the tokens they have acquired over a period of time, represented in their portfolio by an NFT of the bond. In other words, once you acquire the bond, you will receive the tokens in stages according to a well-defined schedule. Then, once you receive these tokens, you can claim them. What is unique about this model is that the price of a bond is proportional to demand and inversely proportional to elapsed time. More specifically, four major factors work together to influence the prices of these bonds. these are:
- Entry price for liquidity provider tokens.
- Exit token price.
- The amount of time elapsed since the last bond purchase.
- Demand for bonds.
Combining these four factors allows us to establish a discount on exit tokens to ensure the competitiveness of our bonds. Therefore, buying a token today at price P does not mean you will get it tomorrow at the same price. This discount system is at the heart of bond returns.
How do discounts work on Eternity Cloud bonds?
Suppose the price of the exit token increases. If the value of the entry token decreases or remains unchanged, the bond discount increases. In fact, the entry token price is going down or staying the same, but the exit price is going up. If the two values are different, the discount will be significant.
Now suppose the price of the exit token falls. If the value of the entry token increases or remains unchanged, the discount on the bond decreases. This is because if the value of the exit token is low and the value of the entrance token is not increasing or changing, the exit token will be obtained at a lower discount rate. The discount decreases as the two price points move closer together.
Even if there is a negative discount, it is still possible to purchase a bond and receive a bond NFT. However, the drawback is that the value of these exit tokens will be higher than the market price.
Note also that bonds are purchased through a single asset. Eternity Cloud's mainnet is on Polygon, and this is his MATIC token, as the majority of the project's community performs transactions.
In summary, reserve bonds introduced by Ethernity Cloud represent a major advancement in the cryptocurrency ecosystem. These offer a new path to sustainable funding for Web 3 projects, while allowing investors to profit from fluctuations in the crypto market. This innovative mechanism is based on a combination of factors including entry and exit token prices, time elapsed since the bond's last purchase, and overall demand. These bonds therefore contribute to the long-term financial health of the project, while providing investors with the opportunity to diversify their portfolios. This initiative, in which bond purchases are made through unique assets on the Polygon network, opens new horizons in the field of decentralized finance.
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Toulouse Scientific Diploma and Certification Consultant Alila Blockchain Exam Rejoined 2019 Coin Tribune. Examining the potential of blockchain in the field of economics, and the relationship between public sensibilities and information providers that will bring about a certain evolution of the social system for learning economics. The month is about understanding blockchain and its opportunities. Analyze the purpose of reality, decipher trends in Marche, analyze innovative technologies and perspectives, and analyze social revolution in Marche.
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