Solv ✕ Strips Finance: The first Bond Voucher IVO
Asset Offered: $STRP Bond Vouchers
Value: $2,000,000 USD
Offering Date: April 12, 2022
Maturity: 90 Days
Strips Finance, the world’s first decentralized interest rate derivatives exchange, will launch STRP Bond Voucher IVO on Solv, which is the first case of introducing debt financing to the DeFi world. The capital raised in this round will be used by the Strips team for providing liquidity in the protocol.
Bond Voucher expands DeFi Universe
The Bond Voucher is a convertible bond, which is a zero-coupon bond with an embedded call option. It helps DAOs issue convertible bonds to raise capital, and leverage treasury assets and credit to obtain sustainable external financing support. This investment product ensures that investors can receive fixed returns and enjoy the potential upside of the project.
The payout curve is the key for the Bond Voucher as a win-win solution. Below the predefined strike price, the DAO pays back steady principal and interest. Above the price, the Voucher converts to a fixed amount of native tokens, giving investors the upside.
The Bond Voucher allows DAOs to capitalize themselves by betting on a higher valuation of the project in the future and delay any native token payment till maturity.
For investors, exercising the call option means enjoying the massive upside if the token price pumps up; without the call option, they could still receive profitable fixed returns in stable coins.
Unlike existing DeFi lending the tools, the Bond Voucher never liquidates the collateral during the term of the bond no matter how volatile the token is. (Time to forget the rigid image of DeFi’s risk of liquidation!)
Details of STRP Bond Voucher IVO
Strips have minted the first ever Bond Voucher backed by $STRP collateral. The sale will live on the Solv IVO platform on April 12.
Highlights of this offering:
About Strips Finance
Strips Finance is an interest rate derivatives platform. Strips’s aim is to build an open platform to trade, create and invest in fixed interest products. The first product is Strips Exchange, an interest rate derivatives exchange.
Solv Protocol is a decentralized marketplace for minting, trading and managing NFTs that represent financial rights. Solv has offered Vesting Voucher, an allocation management fundraising tool, Convertible Voucher, a structured product allowing DAOs to leverage native tokens, and Bond Voucher, the first market-tested debt instrument in DeFi that helps DAOs tap into the debt capital markets.