Bond Pricing
TendieSwap Bonds are dynamically priced directly proportional to demand, and inversely proportional to time. As such Bond pricing is influenced by 3 things:
The price of the input LP token that is used to purchase the Bond
The price of the output token (i.e. $TENDIES)
The time since the last Bond was purchased
Demand for the Bond
These factors combine to determine the discount on the output token, compared to market price. Bonds start out at a specific discount, set by TendieSwap. Over time, that discount will increase if the price of the input LP tokens (#1) and the price of the output token (#2) has no change in value, to make the Bonds more attractive to purchase. When you purchase a Bond, the entire amount of the tokens you purchase will be discounted by the amount shown at the time of purchase.
How Discount Amounts Change
If the price of the $TENDIES token increases, and the price of the input (LP) tokens decreases or stays the same, the discount of the Bond will increase, since the output token is worth more, and the input token(s) is worth the same or less.
If the price of the $TENDIES token decreases and the price of the input LP tokens increases or stays the same, the discount of the Bond will decrease, since the output token is worth less and the input LPs are worth the same or more.
Negative Discount Bond ROI
If the Bond discount is negative, purchasing the Bond NFT will not deliver a return at a price lower than the current market rate. Users can still buy Bonds to provide liquidity, which is beneficial to the project long term, and receive $TENDIES tokens and their NFT, but must understand that they are purchasing at a price higher than current market value.
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