Overview
A bond pays you a fixed amount, the maturity value, on a date you choose when you buy. You pay ETH now, the principal, and receive an NFT that is the bond itself. Whoever holds the NFT holds the claim, so you can keep it to maturity or transfer it, see Your bond as an NFT.
The payment comes from one validator’s Coffer contract and is backed by that validator’s stake. The rate is fixed at purchase and does not move with the network. At maturity you redeem the NFT and the contract pays the maturity value, principal plus interest less the protocol fee taken at purchase, see How a bond works.
What it does not give you
Section titled “What it does not give you”The protocol enforces no minimum backing beyond what is observable when you buy. The contract does not read the beacon chain, so whether the validator’s stake really covers the promises is a check you make before buying, not one the code makes for you. Before you buy walks through exactly what to check, and the risks page explains every mechanism behind those checks. And a bond is one validator’s promise, not a pooled one, if that validator’s stake collapses beyond its buffer, the bond can be left partly or fully uncovered.
The path through these pages
Section titled “The path through these pages”Before you buy is the checks. Buy a bond is the purchase itself. Bond lifecycle and statuses explains every pill and label. Redeem at maturity is the normal ending, When a validator defaults the abnormal one, and Claim escrowed funds covers the case where the validator settled your bond for you.