🪙Bonding

Bonding in TemplarDAO

What is bonding?

Bonding is the secondary value accrual strategy of Templar. It allows Templar to acquire its own liquidity and other reserve assets such as BNB by selling TEM at a discount in exchange for these assets. The protocol quotes the bonder with terms such as the bond price, the amount of TEM tokens entitled to the bonder, and the vesting term. The bonder can claim some of the rewards (TEM tokens) as they vest, and at the end of the vesting term, the full amount will be claimable.

Bonding is an active, short-term strategy. The price discovery mechanism of the secondary bond market renders bond discounts more or less unpredictable. Therefore bonding is considered a more active investment strategy that has to be monitored constantly in order to be more profitable as compared to staking.

Bonding allows TemplarDAO to accumulate its own liquidity. More Protocol-Owned Liquidity(POL) ensures there is always locked exit liquidity in our trading pools to facilitate market operations and protect token holders. Since Templar becomes its own market, on top of additional certainty for TEM investors, the protocol accrues more and more revenue from LP rewards bolstering our treasury.