Solana Bonding Curve
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Solana Bonding Curve, also known as SPAR Curve, is a new asset creation protocol introduced by Solana Labs. It enables the efficient and secure creation of new assets by harnessing the power of bonding curves. In this article, we will explore example smart contracts that you can use as a starting point to create your own bonding curve on Solana.
What is Bonding Curve?
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Bonding Curve is a type of liquidity protocol used in DeFi applications, including Solana’s Interblock Transactions (IBT). It enables the creation of new assets by combining existing assets through a series of liquidity swaps. Bonding Curve is based on the idea of “bonding” two or more assets together to create a new asset that has different properties than either of the original assets.
Solana Bonding Curve Smart Contract Example
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One of the most well-known examples of the Solana Bonding Curve is the SPL Token Swap contract, which allows users to exchange their SPARK (SPL’s native token) for SLP (the Solana token). This contract uses the bonding curve to facilitate efficient asset creation and management.
Here’s an example code snippet in Solidity:
pragma solidity ^0.8.0;
contract SPLBondingCurve {
// Define the assets bonded together
address public SPARK;
address public SLP;
// Define the bonding parameters
uint256 public bondLength; // Number of waiting periods before unbonding
uint256 public minPrice; // Minimum price for unbonding
uint256 public maxPrice; // Maximum price for unbinding
uint256 public reserve1; // Reserve 1
uint256 public reserve2; // Reserve 2
// Initialize contracts with a specific asset
constructor(address _SPARK, address _SLP) {
SPARK = _SPARK;
SLP = _SLP;
// Set bond parameters to default values
bondLength = 10; // Wait 10 periods before unbinding
minPrice = 1; // Minimum price for unbinding: $1
maxPrice = 1000; // Maximum price for unbinding: $1000
reserve1 = 50; // Reserve 1
reserve2 = 50; // Reserve 2
}
// Unbind a period of length bondLength
function unbind() public {
// Get the current prices of SPARK and SLP
uint256 priceSPARK = SPARK.getPrice();
uint256 priceSLP = SLP.get_price();
// Check if we can unbind with enough capital
require(priceSLP > minPrice && priceSLP < maxPrice, "Unbind failed");
// Update reserves and prices
reserve1 -= priceSPARK;
reserve2 -= priceSLP;
// Calculate the new prices of SPARK and SLP
uint256 newSPARKPrice = priceSPARK * (priceSLP / (priceSLP + reserve1));
uint256 newSLPPrice = priceSLP * (priceSPARK / (priceSPARK + reserve2));
// Update Prices and Reserves
SPARK.updatePrice(newSPARKPrice);
SLP.update_price(newSLPPrice);
// Check if we successfully unbonded
require(reserve1 > 0 && reserve2 > 0, "Unbonding failed");
}
}
This contract uses the bonding curve to create a new asset called SPARKL (SPL’s native token) with different properties than SPARK and SLP. The unbind function is used to unbind the bondLength period, which allows the creation of new assets.
Tips for creating your own bonding curve
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- Choose appropriate bonding parameters
: select values that make sense for your use case and make sure you can unbond with sufficient capital.
- Use a reliable liquidity provider: Make sure your liquidity provider is trustworthy and will return high prices to untie the period.
- Monitor and adapt: Continuously monitor your asset prices and adjust collateral settings as needed.