Temperature Check - Solv Bond Voucher for Paraswap

PS Research
1

Introduction

This proposal provides a financing solution, Bond Voucher, for Paraswap with the purpose of capital diversification under the impact of the market downtrends.

This is a temperature check proposal, the objective is to confirm the Paraswap DAO is interested in a collaboration with Solv on the Bond Voucher.

What is Solv and the Bond Voucher

Solv Protocol is the first and largest bond issuing and trading marketplace backed by top-tier institutions including Blockchain Capital, Binance Labs, Sfermion, Spartan, IOSG and so forth.

Bond Voucher

The Bond Voucher is Solv’s premier debt NFT to bridge TradFi with DeFi. Bond issuers can issue debt capital through a Bond Voucher, customizing key financial terms in a no-code front end. The issued Bond Voucher is a NFT which represents the lender’s financial claims on the underlying bond.

Since its February launch, Bond Voucher has successfully raised $1MM for Unslashed Finance, $6MM for Perpetual Protocol and $2MM for Strips Finance and $11MM for iZUMi Finance and $4MM for Solv.

For more information, please taking aim at:

Solv bond voucher overview : Solv Bond Voucher Overview - Google Docs

Onboarding borrowers:

Proposal

Amid increased market volatility, we are seeking to use Bond Voucher to help Paraswap diversify capital resources without the need of selling any assets. Our team will manage the entire process and key execution steps, including bond voucher design, smart contract development, incentives, sourcing lenders and repayments.

Paraswap is one of the most recognised Web3 brands with a great track record and supported by many Tier 1 investors. This provides a solid foundation for trust amongst the lenders. After thorough discussion internally, we are proposing a bond issuance for Paraswap.

Aside from capital diversification, the advantages of this bond issuance are summarized below:

  1. Low-cost and low-risk funding resource
  2. Solv has robust relationships with top investors and lenders to help close the bond sale in a short period of time
  3. Additional $SOLV tokens as incentive rewards

Following are the proposed bond issuance details：

Issued Amount: $2-4MM

Duration: 180 Days

Borrow APR: 8%-10%

Payment Currency: TBD (USDC ideally)

Repayment frequency: Principal and Interest Payable at Maturity

Type of Bond: Collateral Bond

Collateral: 2-3x of Issued Amount

Custody: Not Required
Conversion terms: TBD (example; current market price +50%)

A number of partners and investors have already reached out to Solv and expressed strong desire to purchase a bond issued by Paraswap.

Other Resources

Official Website：Solv

Official Doc：https://docs.solv.finance/solv-documentation/

Discord：Discord

6 Likes
2

It is a good thing to issue 2-4 million US dollars of bonds for the future development of paraswap, but how to use the funds after financing?

3

The proposal makes a lot of sense in principle and I think solv is a protocol more projects should be taking advantage of in this market.

I’d just want to know that at the lower end of this range, ie. raising $2m (together with any other funds Paraswap already has) Paraswap can sustain itself for at least 2 years of runway.

5

Thanks for your interests, @luoxin

Bond Vouchers are ideal for issuers, in this case, Paraswap, to raise debt capital for purposes such as:

  • Bootstrap liquidity
  • Market neutral trading strategies
  • Market making
  • Operational expenses

As tighten monetary policy looms, we believe sufficient and diversified capital resource can serve as safeguard to help paraswap weather the storm

6

Thanks for the compliment, @elisafly we are really flattered.

From our perspective, $2m might not be not sufficient if the market keeps going south. (you could refer to lido’s recent proposal against current market status :Lido to prepare for the bear market - Proposals - Lido Governance)

This proposal is a temperature-check proposal, meaning if the bond insurance proceeds smoothly, we are likely to take our cooperation into the next level. Namely, raising funds will be an ordinary state whenever Paraswap contends with fiscal dilemmas.