BASED token is designed to be used as a medium of exchange. The built-in stability mechanism in the protocol aims to maintain BASED peg to 1 Tomb (TOMB) token in the long run.
Note that BASED actively pegs via the algorithm, it does not mean it will be valued at 1 TOMB all times as it is not collaterized . BASED is not to be confused for a crypto or fiat-backed stable-coin.
Based Shares (BSHARE) are one of the ways to measure the value of the BASED Protocol and shareholder trust in its ability to maintain BASED close to peg. During epoch expansions the protocol mints BASED and distributes it proportionally to all BSHARE holders who have staked their tokens in the Acropolis (boardroom).
BSHARE holders have voting rights (governance) on proposals to improve the protocol and future use cases within the Based finance ecosystem.
BSHARE has a maximum total supply of 50000 tokens distributed as follows:
- Team Allocation: 5550 BSHARE vested linearly over 4 months
- Remaining 44550 BSHARE are allocated for incentivizing Liquidity Providers in two share pools for 5.5 months.
Based Bonds (BBOND) main job is to help incentivize changes in BASED supply during an epoch contraction period. When the TWAP (Time Weighted Average Price) of BASED falls below 1 TOMB, BBONDs are issued and can be bought with BASED at the current price. Exchanging BASED for BBOND burns BASED tokens, taking them out of circulation (deflation) and helping to get the price back up to 1 TOMB. These BBOND can be redeemed for BASED when the price is above peg in the future, plus an extra incentive for the longer they are held above peg. This amounts to inflation and sell pressure for BASED when it is above peg, helping to push it back toward 1 TOMB.
Contrary to early algorithmic protocols, BBONDs do not have expiration dates.
All holders are able to redeem their BBOND for BASED tokens as long as the Treasury has a positive BASED balance, which typically happens when the protocol is in epoch expansion periods.