In order to improve the incentives for eCell tokens and the choice of liquidity management tools, the community r&d team developed and deployed the Bond Protocol. The Bond Protocol provides the core functions of bond issuance, through which projects may issue bonds for project tokens or specific tokens, and the Bond Protocol will be first applied to the Bond issuance of Consensus Cell Network Community eCell Tokens.
Let's take an eCell bond as an example to understand how the bond protocol works on the blockchain. Let's say we have a bond called eCell-230101 with a 1,000,000eCell issue size with a starting date of January 1, 2022, a 1-year bond term with a maturity date of January 1, 2023, The total interest on the bonds is 2,000,000eCell. When a user subscribes to a Bond using eCell, they will receive a corresponding number of Bond tokens. A Bond is a certificate of interest in a Bond held by the user.
Bond: eCell ratio represents the intrinsic value of a Bond. The value ratio is the basis for the calculation of subscribers' subscription and redemption of bonds at maturity.
Bond has a constant value ratio of 1 until the coupon date, after which the Bond's interest incentive will be evenly distributed to all Bond tokens by the second. Bond:eCell's value ratio will increase with the interest distribution (not decrease), and the user's gain from holding Bond will be reflected in the increase in value ratio. When the Bond matures, Since no new interest is produced, the value ratio will not change and the Bond holder can redeem the equivalent eCell.
The Bond issue size refers to the maximum number of eCells that can participate in the subscription of Bond. For example, for the Bond above, the issue size of 1,000,000 ECells means that the cumulative number of ECells that can participate in the subscription of Bond cannot exceed 1,000,000, which is the subscription limit. This is a protection mechanism for Bond investors. The amount of interest is constant and the subscription cap sets a floor for what Bond investors can expect to earn.
In the case of an undersubscribed Bond, as long as the Bond is not due, the number of bonds available will be calculated at the latest value ratio, which is constant at 1 until the Bond commences, after which the value ratio will gradually increase with the interest distribution.
The parameters and attributes involved in a bond can be summarized in the following table：
Bond Token contract address, hold the assets related to the bonds
Bond Token symbol
Bond Token full name
The unit of account for a Bond, such as eCell Bond
The total amount of interest
The amount of interest paid during the life of a bond
Number of bonds
users subscribe to the number of bond tokens that have been minted
Ratio of the prices
The intrinsic value of a bond token, i.e. the number of units of account equivalent to each bond token
Start of time
The time when a bond starts to pay interest
Due to the time
The maturity of a bond at which the bond token can be redeemed into the unit of account of its value
The bond deadline
Maturity time - Starting time
The duration of the current time from the maturity date of the bond
An upper limit on the number of bonds to be subscribed for
The current lock up
The current number of units that have subscribed for bonds
Remaining subscription quantity
State of the bond
There are three states of a bond, based on the starting interest rate, the maturity time and the current time
Raise, renew and expire
Raised means that the bond has not yet reached its coupon date and the bond has a value ratio of 1. Duration refers to the time between the interest date and the maturity date, in this state the bond value ratio will continue to increase; Maturity refers to the expiration date of a bond, at which the bond's value ratio will not increase and the bond holder can redeem the equivalent asset using the bond token.