💸Liquidity Bonds
Overview
Liquidity Bonds let you add BNB to FEG liquidity through a fixed-term LP position.
When you mint a bond, you deposit BNB. The bond matches that value with FEG at a 1:1 value ratio to form the LP position.
The bond matures after 12 months. After maturity, you can withdraw the LP position and any eligible income generated during the term.
Bond terms
Match ratio: 1:1 by value between deposited BNB and paired FEG
Term: 12 months
Withdrawal: Available after maturity
How Liquidity Bonds work
Deposit any amount of BNB.
The bond pairs that deposit with an equal value of FEG.
The combined assets form the LP position for the bond term.
Example: Deposit 1 BNB and the bond adds 1 BNB worth of FEG to create the LP position.
Potential outcomes
Your final result depends on market conditions during the bond term.
Key factors include:
FEG price movement
Trading volume
LP income earned from swap activity
If trading volume stays active, the LP position can earn additional income during the term. If FEG price changes significantly relative to BNB, the value of the LP position can also change.
What happens at maturity
After the 12-month term ends, you can:
Withdraw the LP position
Keep the LP position to continue earning LP income
Remove part or all of the LP to realize gains or rebalance exposure
Because your BNB will be placed in a liquidity pool, the position can be affected by impermanent loss.
LP returns are not fixed. Results depend on price movement and trading activity during the bond term.
Read Impermanent Loss Explained on Binance Academy before participating.
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