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  • ⚡Get Started
    • 1️⃣Step 1: Connect Your Wallet
      • 💳Wallets: Best Web3 Options
      • 💰FOUR Ways to Get Funds onto the Shade App
      • 💰How to move tokens from a CEX to Shade
    • 2️⃣Step 2: Create a Viewing Key
    • 3️⃣Step 3a: Hit The Button -> Buy SHD in >30 seconds
    • 3️⃣Step 3b: Bridge
      • How to bridge to Secret Network
      • How to bridge assets from Secret Network to another chain
    • 4️⃣Step 4: Swap Assets
    • 5️⃣Step 5: Use our Features
      • 💲Bonds Feature
        • How to Claim Bond Rewards
        • How to Purchase a Bond
      • 🏦Borrow Feature
        • Borrow (Silk): How to take out and repay a loan
        • Borrow (Silk Earn): How to Deposit and Withdraw
        • Borrow FAQ
      • 📈Derivatives Feature
      • 📖History Feature
        • What is a transaction hash
        • How to view transaction history
      • 💧Pools Feature
        • How to Enter and Exit Liquidity Pools
        • How to Stake and Unstake
        • How to Claim Rewards
        • 'Mint LP Shares and Stake' vs. 'Mint LP Shares'
        • Liquidity Pool FAQ
      • 💹Portfolio Feature
      • ➡️Send Feature
      • 🔵SILK Feature
        • How to Buy Silk
        • SILK's Peg
        • SILK FAQ
      • 📍Stake Feature
        • How to Stake and Unstake
        • What is stkd-SCRT
      • ⚙️Utilities Feature
      • 🔁Wrap Feature
      • 💠NFTs
        • How to Purchase a Shade NFT
        • How to Verify NFT Ownership
        • How to Sell an NFT
        • How to Bid on an NFT
    • 6️⃣Step 6: Connect with Community
    • 📚Beginner Resources
      • What is SCRT
      • Convert SCRT <> sSCRT
      • ⛽Gas Fees
        • How to Increase Gas Fees:
  • 🌑Advanced Topics: Shade Metaengine
    • 🌑What is SHD
    • 🖥️Tech Stack
    • ✍️Principles
    • ⚕️Ethos
    • 🏛️Governance
    • 🏦ShadeDAO
    • 💰Tokenomics
    • 🌀SHD
    • ✔️Brand
    • 📜Tutorials
  • 🌑Advanced Topics: Apps
    • 🔵SILK
      • Minting & Redemption
        • Overcollateralized Minting
        • Collateral Redemptions
        • Bonds
      • Basket Composition
      • Peg Migration
      • Governance
      • Tutorials
    • 🌉Bridge
    • 💱ShadeSwap
      • Trading
      • Liquidity Providing
      • LP Staking
      • Asymmetric, Concentrated Liquidity
      • Shade Swap Contracts
    • 🦅Lend
      • Stability Mechanisms
      • Risks and Fees
    • 📓Bonds
      • Bond Types
      • Collateral Types
      • Illiquid Markets
      • Issuance Policy
      • Bond Tokenomics
      • Tutorials
    • ♟️stkd-SCRT
      • Feautures
      • User Stories
      • Governance & Validators
      • Tutorials
      • FAQ
    • 💱ShadeX - Money Market
      • Liquidations
      • Logs and Transparency
      • Risk Management
      • Configurations and Restrictions
      • Fees
      • Contracts
  • 💳Wallets
    • Keplr
      • Install Keplr
      • Create Keplr Wallet
      • Import a Keplr Account
      • Import a Ledger Account
    • Fina Mobile
  • Research
    • Audit Log
    • Stablecoins
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  • Profit Scenario
  • Loss Scenario
  • Summary

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  1. Advanced Topics: Apps

Bonds

Safe Deposits, Safe Yield.

PreviousRisks and FeesNextBond Types

Last updated 1 year ago

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Shade Bonds are a privacy-preserving DeFi instrument where users can purchase digital assets from the ShadeDAO by depositing protocol desired cryptocurrencies into a smart contract. The rate at which users deposits assets into the bond smart contract is at a fixed spot price determined by Shade Protocol governance. The rate issued is typically at a discount compared to the market. This discount is given to incentivize users to deposit and acquire assets at a discount.

Profit Scenario

Assume that SHD is trading at $10

(1) User deposits $900 worth of ATOM into the bond contract

  • A 10% bond discount locks in 100 SHD for claim (worth $1,000)

(2) User waits 14 a day vesting period

(3) User claims 100 SHD worth $1,000

From here, a user can sell their claimed SHD for $100 of profit or they could choose to use this newly acquired SHD for staking or lending.

Loss Scenario

Assume that SHD is trading at $10

(1) User deposits $900 worth of ATOM into the bond contract

  • A 10% bond discount locks in 100 SHD for claim (worth $1,000)

(2) User waits 14 day vesting period

(3) Price of SHD decreased to $8

(3) User claims 100 SHD worth $800

From here, a user can sell their claimed SHD for a $100 loss.

Summary

Bonds are a powerful DeFi primitive that will help bootstrap, scale, and grow the ShadeDAO. Governance carefully manages the issuance of Shade bonds so as to not introduce damaging liquidity shocks into the market. If balanced properly, bonds can be the Shade Protocol's primary tool for gathering protocol owned liquidity, yield, and stability for Silk and other key Shade Protocol primitives.

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Bonds Whitepaper.pdf
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Shade Bonds empower the ShadeDAO to acquire uncorrelated assets that are capable of generating yield and deepening liquidity for Shade Apps such as ShadeSwap or ShadeLend.