YIELDBONDA is a new token listing on hive-engine/leodex offering 15% APY.
Overview
By buying this token, you are making a loan of funds to me @nealmcspadden. The funds will then be used in stable coin platforms to provide a level of principal security while obtaining a yield sufficient to pay the note.
The token is available for trading at https://leodex.io/market/YIELDBONDA
For purchases in currencies other than SWAP.HIVE, see Special Notes below.
Tokenomics
- 100,000 tokens will be created, representing 100,000 USD of value locked in the token.
- Each token holder will be paid weekly or monthly at an annualized rate of 15%.
- Example
- Joe Smith holds 10,000 tokens.
- His expected interest is 1,500 USD per year (15%)
- If the weekly mode is active, he will receive appoximately 28.84 USD in payments each week
- Payment methods may change, but at this time all payments are expected to be in HIVE at a daily fix price.
Pre-Sale
- A pre-sale will take place until at least 30,000 tokens have been sold or Dec 31, 2020 is reached, whichever comes first.
- If fewer than 30,000 tokens are sold by Dec 31, 2020 then all funds will be returned to lenders.
The token price will be fixed to 1 USD each morning.The token price is continually adjusted to be within 1% of 1 USD. As the price of SWAP.HIVE varies over time, be sure to calculate your own yields based on the current market price.Example
The morning fixed price of 8.333 is based on 0.12 $/HIVE.
Over the course of the day, HIVE rises in value to 0.14. At this price, 8.333 will cost 1.166 USD in HIVE, reducing your yield.
Future Development: We plan to implement a script that will re-list the price of the token as the price of HIVE changes rather than manually re-listing once per day.
Operational Phase
- Once at least 30,000 tokens have been sold, the loans will become active.
- Funds will be moved off the HIVE blockchain and into ethereum assets in order to obtain a yield.
- Payouts will start approximately 1 week later. There may be small timing differences based on network congestion and gas fees. If gas fees rise too high, payouts will shift to monthly.
- The token will continue to be sold until all 100,000 tokens are sold. After that point, users may sell their token on the market for any price they wish.
- Weekly updates will be provided on the status of loans and payments.
Exits and Redemptions
- There are 3 methods of exit:
- 1, Sell your token to another user. The market price will vary depending on demand and whether the total supply has been sold or not.
- 2, Once in operational phase, you may redeem your loan with 1 week notice to me. Your balance will be impacted by gas fees of liquidation. Effort will be made to pick low-fee times to liquidate, but cannot be guaranteed.
- 3, If yields collapse to the point that maintaining the 15% payment to lenders is unsustainable, lenders will have the option of liquidation & return of principal or accepting a reduced payout.
Risks
- All loans carry risk.
- These specific stable assets are chosen in order to minimize those risks, but they do not eliminate them.
- If a stable asset is found to be fraudulent or hacked, it can and probably will affect the balance of funds and the ability to pay the stated rate of interest.
- These loans are non recourse.
- Do your due diligence on the borrower and the intended uses before making any lending decision.
Special Notes
- You'll notice the name YIELDBONDA. I expect that if there is sufficient interest, more of these bonds will be offered in the future.
- If you want to pay with something other than SWAP.HIVE (e.g. LEO, ETH, BTC, etc), contact me directly on discord @nealmcspadden#9419. Minimum quantity for direct sale is 5,000 tokens. Start your message with "YIELDBONDA"
My Thoughts
I am pretty excited to see this model develop. While it's not the first crypto-based loan product in existence, it may very well be the most accessible to date. By utilizing stable coin assets, we are eliminating the majority of risk to any kind of yield farming. You are lending in USD, and we are putting USD to work.
The risks that remain are basically platform hacks (very low risk in my opinion) and stable-coin demonetization. For example, if the STABLE Act that some Democrats are pushing for passes, USDC might have to reorganize. Or if the crypto world turns on USDT, then that will impact that portion of the portfolio.
Overall though, I think this is going to go great. Effectively, it's a super high-powered savings account. If yields on farming operations come down to the point where 15% isn't feasible any more, then the loan balances get returned and you go on your way having made 15% all the while.
Watch this page for updates over time.