Announcing DAOJO Bonding: A Step Forward in DojoSwap’s Path to Stability

Hi Ninjas,

We are excited to announce the launch of DAOJO Bonding, a long-awaited feature of Injective’s first rebasing governance and POL token. This marks another step forward in DojoSwap 2.0’s vision, moving us closer to becoming a fully self-sustaining DEX.

Overview

Bonding is the process of trading tokens, LP tokens, or otherwise, to the protocol for DAOJO. The protocol quotes the amount of DAOJO in return, typically more than market value, with a vesting period. To mitigate risks of potential negative price spirals, bonding will be launched cautiously, starting with only $INJ which is paired to $DOJO and with a capped amount of $DAOJO available for bonding.

This is important as the ecosystem has only just started to base in terms of price action, especially with DERF in full swing. In rolling out this feature, we aim to use bonding as yet another tool to bolster and stabilise the ecosystem and $DOJO’s price action during high volatility events such as launchpads and black swan events.

Key Details of DAOJO Bonding:

• Bonding Asset: Only $INJ can be used.
• Discount to Market Price: 5% discount to market price ($105 worth of $DAOJO for $100 of $INJ)
• Vesting Period: 5 Days
• Effective APR: 365% (equivalent to 1% daily asset accrual)
• Bonding Cap: $250K USD worth of $INJ
• Key Feature: Dynamic demand and supply for bond to determine ROI

All $INJ received from bonding will be added to the DAOJO Treasury and be used as part of DERF.

Small Inflation for a Large Gain

All DAOJO provided through bonding will be newly minted. Assuming the cap is met, inflation will be minimal at less than 5% of the current total circulating supply. Despite being slightly inflationary, this enables DAOJO to create a flywheel for liquidity where staking APR can be increased for participants and treasury value is more strongly protected from tokens received in exchange for DAOJO.

In the unlikely event of a negative price spiral, it is worth noting that the DAOJO Treasury has 12.5 Mil $DOJO and 10k $INJ that will be used to support $DOJO and $DAOJO price action. This excludes any $INJ that will be received from bonding. In addition, 65% of all DAOJO-DOJO LP tokens are owned by the DAOJO Treasury. Liquidity for DAOJO-DOJO has also been increased by more than $100K in the recent days.

We expect this to be a net neutral event at worst and a large boost for the liquid backing of the DAOJO Treasury and DERF at best. In the event of a successful bonding campaign, we expect to use the funds more aggressively as we progress toward the full launch of Injera.

Why Do I Want to Bond?

Participant Benefits

• Discounted $DAOJO: Participants get a discount rate of 5% for bonding $INJ, effectively receiving $105 worth of $DAOJO for $100 of $INJ
• Avoid Multi Hop Slippage and Fees: Since bonding is done in an interaction directly with the protocol, you skip slippage and DEX fees entirely, further reducing costs. In the case of INJ, you skip 2 hops of slippage and DEX fees.

Utility of $DAOJO:

• Single Side Staking: Earn high APRs by staking $DAOJO without the risk of impermanent loss.
• Governance: Influence key decisions and proposals within the DAOJO and DojoSwap ecosystems.
• Stability: The treasury uses funds for strategic buybacks to maintain price stability and attract liquidity.

Future Prospects

As the DAOJO ecosystem grows and new features are introduced, participants can expect enhanced utility for bonded $DAOJO tokens. Upcoming developments include:

• Enhanced Staking Rewards: Higher APRs as the ecosystem scales and market conditions improve.
• Enhanced Liquidity Farm Rewards: Higher APR to attract more liquidity and reduce the volatility of DAOJO-DOJO

How Bonding Works

When you deposit $100 in INJ, you will receive $105 in DAOJO over 5 days. This is useful especially if you have plans to enter the Dojo ecosystem but want to enter without slippages (when you buy DAOJO off market directly). Over the course of 5 days, you will get to claim ⅕ of the total value. This means that at the end of day 1, you will be able to claim 105/5 = $21 DAOJO, day 2, another $21 DAOJO all the way until day 5. DAOJO will accrue and you can claim anytime. If you claim after 1 hour, you will receive 1/(24*5) of your total yield.

Conclusion

DAOJO Bonding represents a pivotal step in our mission to create a resilient and community-centric DojoSwap ecosystem. Join us in shaping the future of DojoSwap. Participate in the bonding process today and be part of a community that values innovation, stability, and growth.

Stay Updated With Us

Website: https://dojo.trading/
Telegram Channel: https://t.me/dojoswapann
Telegram Group (English): https://t.me/dojo_swap
Telegram Group (Chinese): https://t.me/dojoswapcn
Price Discussion: https://t.me/dojoprice
Twitter: https://twitter.com/Dojo_Swap
Gitbook: https://docs.dojo.trading/