Bond Sales

Liquidity Pools

Once a bond is issued, it will appear on the Optim UI where liquidity providers are able to deposit ADA to participate in the bond. SPO bonds require a large amount of ADA to be economically viable and serve their intended purpose. As such, Optim provides a pooling function that enables many lenders to buy bonds and pool funds in order to fulfill a single SPO’s borrow order aka ‘bond issuance’ (1M ADA minimum). An SPO Bond is not active until a pool is completely filled. The full amount of ADA indicated by ‘Bond Value’ must be deposited into a pool before it becomes ‘active’. Until this occurs, an SPO’s stake key isn’t attached to any of the pooled/deposited ADA and no interest payments are incurred. It is possible for a single whale to deposit the full amount and buy all the bonds, in which case a bond becomes active and starts the ‘duration’. Otherwise, the bond remains inactive until enough liquidity to meet the total Bond Value has been provided by enough users.

Pending Pools

SPOs will be able to monitor the progress and state of their bonds by utilizing the Your Page user interface. Active Bonds, whereby an SPO has control of the associated stake key of their Bonds, will be known as and appear as ‘Bond Positions’ on the UI. The parameters agreed upon during the bond issuance form will be summarized here.

Canceling a Pending Pool

Up until the bond is fully funded, which changes its status from ‘pending’ to ‘active’, an SPO can cancel the position and fully reclaim all of the prepaid interest premium, incurring no penalties in this scenario. As liquidity is captured by the pool, lenders are given Equity Tokens representing their ownership share of the pool. Equity Tokens, or EQTs, are placeholder tokens that are not locked and thus allow users to withdraw their ADA from the pool only while the loan is still pending. These tokens will need to be converted by the lenders to Bond Tokens once the pool is fully funded and the bond becomes active by clicking the Convert button on their Open Positions page.

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