Bonding Mechanism

Operation

Aurica’s Treasury incorporates a bonding mechanism that is akin to the one utilized by OlympusDAO. In this system, users can deposit liquidity provider (LP) tokens, representing a pair of fractionalized carbon credits and a stablecoin such as USDT or USDC, into the Treasury. In return, they receive $AURI at a discounted rate, but the conversion is not immediate. A vesting period is put in place to ensure a balanced inflow of assets into the Treasury and to mitigate against immediate sell-off risks, providing a controlled environment for asset appreciation and stabilization.

Benefits

For Platform Users

This bonding process benefits Aurica platform users by offering them an option to convert their earned fractionalized carbon credits into $AURI, which is a more liquid asset on the blockchain. Since $AURI can be staked for additional rewards, users have an incentive to bond their credits and thus, remain engaged with the platform's economy.

For the Treasury

For the Treasury, bonding serves as a method of asset diversification, accumulating a mix of Web3 assets and RWAs. This diversification is critical for the Treasury to function as the ecosystem's financial center, supporting activities such as issuing green bonds and other environmentally-focused financial instruments.