Bonds Overview
Financial mechanism allowing the protocol to acquire treasury assets in exchange for PARS at a discount.
Bonds Overview (اوراق قرضه)
Bonds (اوراق قرضه - Oraghe Gharzeh) are a financial mechanism that allows the protocol to acquire treasury assets in exchange for PARS at a discount. Bonds serve as the primary method for growing protocol reserves and managing PARS supply.
What Are Bonds?
Bonds are a market-driven exchange mechanism:
- Users provide assets (stablecoins, ETH, LP tokens)
- Protocol provides PARS at a discount to market price
- Transaction settles over a vesting period
Unlike lending, bonds are purchases—not loans that require repayment.
Why Bonds?
For the Protocol
| Benefit | Description |
|---|---|
| Treasury Growth | Accumulates reserves without external funding |
| Supply Management | Controls PARS supply based on demand |
| Liquidity Acquisition | Acquires permanent protocol-owned liquidity |
| Price Stability | Provides counter-cyclical supply mechanisms |
For Users
| Benefit | Description |
|---|---|
| Discounted PARS | Acquire PARS below market price |
| Treasury Participation | Contribute to protocol health |
| Predictable Terms | Known discount and vesting schedule |
Bond Types
Reserve Bonds (اوراق ذخیره)
Reserve Bonds accept reserve assets in exchange for PARS:
┌─────────────────────────────────────────────────────────────────┐
│ RESERVE BOND FLOW │
├─────────────────────────────────────────────────────────────────┤
│ │
│ Bonder Protocol Treasury │
│ │ │ │ │
│ │ 1. Provide USDC │ │ │
│ │ ──────────────────────►│ │ │
│ │ │ 2. Deposit to Treasury │ │
│ │ │ ────────────────────────►│ │
│ │ │ │ │
│ │ 3. PARS (discounted) │ │ │
│ │ vests over time │ │ │
│ │ ◄──────────────────────│ │ │
│ │ │ │ │
│ │
└─────────────────────────────────────────────────────────────────┘Accepted assets: USDC, DAI, FRAX, ETH
Purpose: Accumulate treasury reserves
Inverse Bonds (اوراق معکوس)
Inverse Bonds provide reserve assets in exchange for PARS:
┌─────────────────────────────────────────────────────────────────┐
│ INVERSE BOND FLOW │
├─────────────────────────────────────────────────────────────────┤
│ │
│ Bonder Protocol Treasury │
│ │ │ │ │
│ │ 1. Provide PARS │ │ │
│ │ ──────────────────────►│ │ │
│ │ │ 2. Burn PARS │ │
│ │ │ (reduces supply) │ │
│ │ │ │ │
│ │ 3. USDC (instant) │ 4. Withdraw reserves │ │
│ │ ◄──────────────────────│◄─────────────────────────│ │
│ │ │ │ │
│ │
└─────────────────────────────────────────────────────────────────┘Output assets: USDC, DAI (stablecoins)
Purpose: Absorb sell pressure, stabilize price below range
Note: Inverse bonds vest instantly (no waiting period)
Liquidity Bonds (اوراق نقدینگی)
Liquidity Bonds accept LP tokens in exchange for PARS:
Accepted assets: PARS/ETH LP, PARS/USDC LP
Purpose: Acquire protocol-owned liquidity
PARS Bonds (اوراق پارس)
PARS Bonds exchange PARS for PARS with time-locking:
Purpose: Transition from liquid staking to time-locked staking
Use case: Users lock PARS for discounted future PARS
Bond Pricing
Sequential Dutch Auction (SDA)
Bonds use a modified dutch auction mechanism:
┌─────────────────────────────────────────────────────────────────┐
│ SDA PRICING │
├─────────────────────────────────────────────────────────────────┤
│ │
│ Discount │
│ ▲ │
│ │ ╱╲ │
│ │ ╱ ╲ ╱╲ │
│ │ ╱ ╲ ╱ ╲ │
│ │ ╱ ╲ ╱ ╲ │
│ │ ╱ ╲ ╱ ╲ │
│ 0 │ ╱──────────╳────────╲──────────────────────────► Time │
│ │ │
│ │ Purchase Recovery Purchase Recovery │
│ │ │
│ │
│ Discount increases over time until purchase │
│ Each purchase resets the price; discount then grows again │
│ │
└─────────────────────────────────────────────────────────────────┘Key Properties
| Property | Description |
|---|---|
| No oracle dependency | Price set by market demand |
| Self-regulating | Supply sold evenly over bond term |
| Market-driven | Discount reflects actual demand |
Discount Calculation
discount = (market_price - bond_price) / market_price × 100%- Positive discount: Bond offers PARS below market
- Negative discount: Bond offers PARS above market (no purchase)
Vesting
Most bonds vest over time to prevent immediate selling:
| Bond Type | Vesting Period |
|---|---|
| Reserve Bonds | 5 days |
| Liquidity Bonds | 5 days |
| PARS Bonds | Variable (user-selected) |
| Inverse Bonds | Instant |
Claiming
Vested PARS can be claimed at any time:
- Partial claims allowed
- No penalty for early partial claim
- Fully vested after vesting period
Bond Markets
Active Markets
The protocol maintains multiple active bond markets:
| Market | Asset | Status |
|---|---|---|
| USDC Reserve | USDC | Active |
| DAI Reserve | DAI | Active |
| ETH Reserve | ETH | Active |
| PARS/ETH LP | LP Token | Active |
Market Parameters
Each market has governance-controlled parameters:
| Parameter | Description |
|---|---|
| Capacity | Maximum PARS available for bonding |
| Vesting | Time until bond fully vests |
| Control variable | Price adjustment speed |
| Min/Max price | Price boundaries |
Range-Bound Stability Integration
Bonds integrate with Range-Bound Stability (RBS):
Above Upper Cushion
Reserve Bonds activate:
- Sell PARS at premium
- Accumulate reserves
- Reduce PARS supply pressure
Below Lower Cushion
Inverse Bonds activate:
- Buy PARS with reserves
- Burn purchased PARS
- Support price
Related Documentation
- How Bonds Work – Detailed mechanics
- Treasury – Where bonded assets go
- PARS Token – Token economics
MIGA Token
Governance token of the Freedom of Information DAO, funding anti-censorship technology, independent media, and cultural expression for Iran.
How Bonds Work
Detailed technical documentation on bond purchase flow, Sequential Dutch Auction pricing, vesting, and integration with Range-Bound Stability.