How to release the liquidity of vsToken

Convert vsBond into vsToken

SALP introduces a mechanism for converting vsBond into vsToken.

The system pricing mechanism is used to set different conversion exchange rates according to different redemption periods to obtain a more accurate vsBond value, and realize the conversion of non-homogenized and non-equivalent vsBonds to fully homogenized vsTokens. It makes the circulation of vsBond smoother and meets the needs of users to quickly release full liquidity.

In order to facilitate the user's liquidity and value replacement, you can convert vsBond into vsToken through the "Convert" feature. The converted exchange rate is related to the bond's expiration time.

  1. Enter bifrost.app and click "Bond" under "Explore more" in the main navigation menu on the left

  1. Switch to the "Convert" page by click on the Convert tab on the top

  1. Select the vsBond you may have in the list by clicking in the dropdown list

The purple circle on vsBond icon represents the remaining time to vsBond redemption.

  1. Input the amount of vsBond to redeem, click on the "Convert" button and sign the transaction.

Your vsBond will be converted into vsTokens based on the Bond ratio once confirmed (vsDOT or vsKSM)

By doing so you drop the ability to redeem your contributed DOT (KSM) when the redemptions opens, it's very hard to get vsBond on the market


Convert Rate Matrix

vsBond lease remainingvsBond expired timevsBond β†’ vsKSM ratevsKSM β†’ vsBond rateKSM cashed outArbitrage Return Rate (hold equal vsKSM)APR

Retired

Expired

0.9

0.9

0.6

0

0

9

378

0.64

0.66

8

336

0.68

0.7

0.672

0.4706

0.5112

7

294

0.72

0.74

0.688

0.4368

0.5423

6

252

0.76

0.78

0.704

0.4045

0.5859000000000001

5

210

0.8

0.82

0.72

0.3736

0.6494

4

168

0.84

0.86

0.736

0.34409999999999996

0.7476

3

126

0.88

0.9

0.752

0.31579999999999997

0.9148000000000001

2

84

0.92

0.94

0.768

0.2887

1.2543

1

42

0.95

0.97

0.782

0.2658

2.3101

0

0

1

1

0.8

0.25

0

-1

0

0.95

0.95


Swap vsTokens

You can sell vsDOT (vsKSM) at anytime to release liquidity in advance

  1. Enter bifrost.app and click "Swap" on the left main navigation menu to enter the swap page

  2. Select vsDOT (vsKSM) and DOT (KSM) through the token dropdown menu on the token names

  1. Enter the number of tokens that need to be swapped, and verify the output of the transaction (price impact).

The closer from 0.5 the swap ratio is, the more you will receive

Reminder: each vsDOT (vsKSM) has a theoretical price of 0.5 DOT (KSM)

  1. Click the "Swap" button to confirm the transaction and complete the signature


Buy Bond

You can also use tokens to buy token bonds sold by other users for arbitrage

  1. Enter bifrost.app and click"Bond" under "Explore more" in the main navigation menu on the left

  1. The Bond market is displayed with the information of stock and APY.

  • Stock is usually low to null because the stock comes from people converting their vsBond to release their liquidity before the end of the lease period and dropping the ability to redeem when the redemption opens.

  • And there is of course the arbitrage opportunity to buy Bonds at a discount price (compared to full redemption), so usually the available vsBonds don't last long in the Bond market.

  1. In case where there is no available vsBond remaining in the SALP protocol, you won't be able to buy Bonds from current stock:

  1. Enter the amount of bond you want to buy in the pop-up window

  2. Click the "Confirm" button and complete the signature

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