Bonding
Strategy 3: Bonding (Selling LP for Discounted $WM)
Overview: Bonding is a mechanism by which users can sell assets to the protocol in exchange for $WM at a discounted rate. In WOMO’s context, bonding typically means you deposit $WM LP tokens (assets like $WM-$S or $WM-$USDC) into the Treasury via a bond, and receive $WM tokens at a lower price than market. However, the tokens are vested over time and not received immediately.
How Bonding Works:
On the WOMO app, navigate to the “Bond” section.
When you start a bond, you’ll deposit a specific asset - like $WM-$S LP, $WM-$USDC LP, or a single token using our zapper.
In return, the protocol offers $WM tokens at a discount to the current market price. For instance, if $WM is $5 in the market, a bond might allow you to get it for $4.50 (a 10% discount). This discount is the incentive to bond.
Vesting: The $WM owed from the bond is vested over a set period (commonly 5 days). This means the bonded $WM cannot be traded immediately — It becomes fully claimable only after the vesting period ends.
Benefits for the User (Bonder):
One of the biggest advantages of bonding is protection from rebases during vesting. Here’s why it matters: Imagine the rebase rate is 5% per day. If you bond 1 $WM with a 5-day vesting period, you’ll unlock 1.1 $WM at the end. If instead you bought 1 $WM directly from the market, after 5 days and ~25% cumulative rebases, you’d be left with just ~0.75 $WM.
The difference? Bonding gives you a 10% bonus upfront and shields you from supply reductions — meaning your effective advantage over regular buyers is about 46%.
Once claim the vested $WM, you can then use them in other strategies (for example, add them to liquidity and stake, or just hold). The optimal strategy is often to bond, then once the bond vests, stake the received tokens to keep earning (e.g., bond LP, then once you get $WM, perhaps pair it with more $S or $USDC to form new LP and stake, compounding position).
Vesting and Auto-Claim: Once bonding is complete, a vesting schedule begins. The bonded $WM remains locked and cannot be claimed during the vesting period. After the vesting period ends, the full amount becomes available for claim. Even without manual claiming, the system includes an auto-claim mechanism (explained in the next section), ensuring that no unclaimed $WM remains exempt from rebases. This prevents missed rebases or rebasing avoidance due to unclaimed tokens — the protocol will process them automatically.
In summary, active participants are encouraged to either provide liquidity (and stake it) or bond assets to acquire more $WM. These strategies synergize with the deflationary rebases, LP stakers and bonders are rewarded and can come out ahead. The combination of these mechanisms is what will drive WOMO's value and distribute tokens into the hands of those contributing to the protocol.
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