Summary
Create a USDap vault to attract USDap holders to stake and earn rewards.
Background
What is BondAppetit?
BondAppetit is a DeFi protocol for business loans. Businesses can borrow money (in fiat as well as in crypto) from the protocol, providing bonds with fixed income as collateral. A loan can be made in two ways: through loan agreement, and through a sale and purchase agreement. BondAppétit is a part of the Ethereum ecosystem.
BondAppétit issues two native tokens — the BondAppetit USD (USDap) and the BondAppetit governance token (BAG).
What is USDap?
USDap is the native stablecoin of BondAppetit. It is built on Ethereum and is fully backed by real-world assets (yield-generating bonds). The bonds are stored by a licensed custodian in a stable jurisdiction. Anyone can check their availability any time online at the protocol’s website. The information is transmitted from the custodian and is digitally signed making data spoofing impossible.
What is BAG?
BAG is a governance and a reward token, which is used to vote on-chain and to collect the bonds’ interest in dollars. Technically, it is an ERC-20 token and is based on the Compound Governance system — a recognized industry standard with the highest rate of transparency and security. Any member of the BondAppetit community with more than 1 million BAG tokens can initiate a governance proposal.
BAG had a gradual and fair launch. 100 million tokens will be distributed within two years. 65 million of them are reserved for the community.
Team
The protocol was built by a team of coders, lawyers, and financiers, who worked at and with the most well-known global corporations. The key founder is Artem Tolkachev, a former head of the Blockchain Lab at Deloitte. One of our advisers is Sasha Ivanov, CEO of Waves.
Project history and plans for the near future
BondAppetit was launched on April 5, 2021. In the first few days since launch, the volume of locked funds reached $10 million.
Over the ensuing several months, BondAppetit reached several key milestones:
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BondAppetit established its first partnership to help increase the emission of the USDap stablecoin. The partner is the EAST Finance, the first protocol targeted at large businesses. EAST is a part of Waves, a massive crypto ecosystem with a market cap over $2 billion. The EAST token is partially backed by USDap.
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BondAppetit acquired a portfolio of corporate bonds to fully back the USDap. The USDap is currently backed by bonds of the following companies: Nexa Resources, Ecopetrol, Delta Air Lines, Ford Motor, Xerox Holdings, American Airlines. These are bonds rated BB / BB +, with maturity dates for 2026–2029 and coupon yields ranging from 5.38% to 7.38%.
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BondAppetit started to distribute profits generated by its bonds’ portfolio among BAG token holders. To be eligible for receiving payments, token holders have to stake their tokens in a special contract for 3, 6 or 12 months. The income is accrued for each block and distributed in USDC (in the future, the protocol will transition to making payments in USDap). The current APY is above 8%.
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BondAppetit has distributed more than 10% of all BAG token emissions among its liquidity providers. To become fully decentralized, the protocol has committed to distribute 65% of total BAG supply among the community.
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In October 2021, BondAppetit raised $350,000 from the Digital Fortress investment fund. The fund retains an option of acquiring more BAG tokens throughout the year.
Until very recently, the value of the protocol was based on expectations. Now, as the protocol proved its business model, has stable cash flows, acquired collateral to fully back its stablecoin, started distributing profits to token holders, and secured the first investment round, BondAppetit is ready scaling. The key task now is to grow the supply of USDap. The protocol plans to achieve this in part by establishing partnerships and attracting investments.
The demand for decentralized stablecoins with robust and transparent collateral is insatiable. Many institutions and protocols are in need of such assets.
The stablecoin market is currently led by two mainstays: Tether and Circle. Tether is centralized and notoriously opaque. The large portion of their assets consists of commercial bonds. But no one knows for sure whether USDT is fully backed and if underlying assets even exist. Tether has been a source of FUD for many years.
Circle is more transparent and willing to comply with regulators. Its stablecoin is perceived as less risky than USDT, but the impression is deceptive. Circle strives to become a de-facto U.S. parastate entity. Circle openly admitted that they can freeze any USDC account with a flip of a switch.
For its own good, the crypto market needs to shift to decentralized stablecoins. Centralized stablecoins are too much of a risk.
A few words on market size. The market for business loans is enormous. The corporate loans and short-term liquidity markets are worth tens of trillions of dollars.
Some TradFi companies are already looking for ways to connect decentralized finance and traditional debt instruments. Back in September, Société Générale applied for a $20 million MakerDAO loan using bonds as collateral:
BondAppetit seeks to become a bridge between DeFi and the traditional debt financing market. The protocol has the necessary infrastructure and is now poised for scaling.
Motivation
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USDap is fully (100%) backed by real-world assets and can become a mainstream stablecoin.
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More stablecoins from different issuers, under different custodians and for different markets can lower down the systematic risk.
Specification
USDap is the native stablecoin of BondAppetit. It is built on Ethereum and is fully backed by yield-generating bonds. The bonds are stored by a licensed custodian in a stable jurisdiction. Anyone can check their availability any time online at the protocol’s website. The information is transmitted from the custodian and is digitally signed making data spoofing impossible.
For:
Create a USDap vault.
Against:
Do not create a USDap vault.