Karma Bond mechanics

A user bonds LP tokens (e.g. Token X/stable coin).
LP tokens go to the Karma Bond contract and are distributed to the corresponding protocol treasury contract.
The Karma Bond contract receives the protocol token at a discount from the protocol treasury.
The discounted protocol tokens are issued to the user based on the vesting period (e.g. 5 days).
The Karma Bond service charges a 3.3% fee on the protocol token pay-out.
The fee is sent to the Karma Finance Treasury.
The 3.3% fee charged by Karma Bond is quoted against a price oracle to determine the fee’s USD value. For every 1 USD worth of fees, 1 bKARMA is minted. 90% of the bKARMA minted goes to the user.
10% of the bKARMA minted goes to the early contributors. 
Example: Julie’s LP tokens generate 30 USD worth of fees for Karma Bond. Julie is rewarded with 27 bKARMA in addition to the discounted protocol token. The Karma early contributors receive 3 bKARMA.
Last modified 11mo ago