Please note that none of this is financial advice. You should do your due diligence to become an informed investor by doing your own research, coming to your own conclusions, and taking note of the risks and responsibilities associated with participating in Tomb.Finance.
The team is available in the Discord to answer questions, so please reach out if they're not answered here!
Why have a token that’s pegged to the price of $FTM when you could just use $FTM itself instead?
But before we dive into what $TOMB could mean for you as an investor, let’s break down the potential impact of $TOMB’s long-term success on the Fantom ecosystem as a whole.
If $TOMB succeeds in holding the peg, this will create a mirrored, liquid asset that can be moved around and traded without restrictions, all while benefiting from the price appreciation of the native $FTM token. Reaching the peg and holding the peg is crucial, and this will ultimately be what drives the value of $TOMB for investors. In the short term, this would mean attractive APRs for liquidity providers on what would essentially be a stable pair.
So, once a liquid market is the norm, what happens next? What are some other reasons you’d want to hold $TOMB?
$TOMB aims to become the primary utility token of the Fantom ecosystem, and the first step is its role in FTMpad, Fantom’s first incubator & launchpad. The selection, development, and deployment of the next generation of Fantom DeFi projects will be decided by those who hold $TSHARE, $TOMB’s governance token (affectionately referred to as “the money printer” by gravediggers). Oh, and we’re just getting started.
1.“ELI5: I keep seeing that Tomb will solve Fantom Opera's liquidity issues, but I don't fully understand what that means or its implications.”
You may have read that by pegging to $FTM, $TOMB hopes to become a highly liquid, mirrored asset. What does this actually mean though?
As an example, say the dollar is the world's main medium of exchange. Everything is measured in terms of dollars, whether that's your weekly salary, or whether it's the price of bread or a computer. And you need dollars to buy literal gas to get to the bakery, or to the computer store.
But imagine if nobody wanted to use their dollars, and preferred to keep them under their mattresses instead. Since the value of everything gravitates in relation to the dollar, there would need to be something out there that is 1:1 "interchangeable" with the dollar, so that even if all the dollars in the world were tucked under mattresses, people could continue to transact freely.
Knowing that whatever they received would be able to be traded in for a dollar at whatever point in time they so desired. That's what $TOMB hopes to become for $FTM.
1.“Generally speaking, what's the easiest flow to follow for compounding rewards?”
The following is NOT FINANCIAL ADVICE. It is for education and entertainment purposes only.
There are countless strategies, and which one you choose depends on your risk tolerance and short, medium, and long-term goals. That being said, the "plug-and-play" method is detailed below. Also, take some profits along the way. Don't get too greedy.
If $TOMB is OVER the peg:
-Buy $TOMB and pair it with $FTM to provide liquidity, and stake your TOMB-FTM LP in the cemetery to earn $TSHARE rewards.
-Take your $TSHARE rewards and stake them in the Masonry to earn inflationary $TOMB rewards.
-Sell half of your earned $TOMB for $FTM, and compound it back into the TOMB-FTM LP.
If $TOMB is UNDER the peg:
1.Buy TOMB and exchange it for TBOND. If you are LP'ing, you can break the LP to exchange $TOMB for $TBOND, and use the remaining $FTM to buy $TOMB to also exchange for $TBOND. Now you have a big fat bag of $TBOND, and you've also helped bring $TOMB back above peg so that the Masonry can resume printing.
2.Sell $TBOND for a redemption bonus once $TOMB is back over peg (above 1.1 TWAP).
2. "What is 50/50?"
50/50 is the method best suited to provide stability for both the platform and for your underlying investment. By boosting liquidity, the 50/50 strategy reduces price volatility, and helps $TOMB stay above the peg for longer to keep the Masonry printing. This, in turn, attracts new investors and keeps the ecosystem growing.
1)When you claim your $TOMB rewards in the Masonry, sell 50% of them for $FTM.
2)When you go to provide TOMB-FTM LP, stake the entirety of your remaining TOMB with the $FTM you've just purchased.
3.“There's so many auto-compounding vaults, what should I do?”
If you are in a $TOMB-FTM LP auto-compounding vault, you are creating buy pressure on $TOMB. If you are in a $TSHARE-FTM LP auto-compounding vault and you also hold $TSHARE elsewhere, the auto-compounding vault will be suppressing its price since it is continuously selling $TSHARE.
(Please Note: Always proceed with caution. We DO NOT recommend putting more than 5% of what you are staking on Tomb into a single auto compounder. Defi involves significant risks and users should manage risks accordingly. For example, users should only put in what they are willing to lose. DO NOT invest your life savings and do your homework before getting active in Defi.)
4. "APR is much higher in the Masonry than in the cemetery for TOMB-FTM LP. Why would I not just invest everything there?"
The cemetery APR is linear and prints 24/7, regardless of Tomb's relation to the peg. Masonry, on the other hand, prints only when Tomb's TWAP is above 1.01. Therefore, it may not always be that an investor gets a higher return from the Masonry than from the TOMB-FTM pool.
Because $TOMB follows the price of $FTM, the TOMB-FTM LP is akin to holding $FTM in your wallet, except with the bonus of a high farming APR on top of it. In other words, if you're bullish on $FTM's price action, the TOMB-FTM LP is a way of holding exposure to that single asset while also reaping high APRs.
Terms and Mechanisms
1. "What is an expansionary epoch?"
An expansionary epoch is the amount of $TOMB that is printed by $TSHARE in order to increase the total circulating supply.
To simplify the explanation with a hypothetical example, let’s say an epoch is 3 days long and there are $100 dollars in the circulating supply.
If the money printer grows the supply by 10% of the existing circulating supply each day, at the end of the 3 days you'd have 100*1.1*1.1*1.1 = $133.
Then, let’s say the emissions decrease to 5% per day.
You’d then have have $133 *1.05 *1.05 *1.05 = $153 at the end of this second epoch.
2. “What is compounding in the context of Tomb.Finance?”
Earning a return on gains you've already made from previous periods is what is commonly referred to as compounding.
For example, consider a 3% daily APR on an initial investment of $100.
After 24 hours it would grow to $103.
After 365 days without compounding: $1195.
After 365 days, compounding once daily: $4,848,272.
1.“Once Tbonds are emitted, does the Masonry stop printing $TOMB until we are above peg again?”
Staking $TSHAREs will give you $TOMB rewards when the price of $TOMB is above the peg (FTM), but not when it is under the peg.
2. “What happens if I interact with the Masonry in any way?”
Any interaction with the masonry will reset both timers. That's 3 epochs (18 hours) to withdraw your TOMB rewards, and 6 epochs to unstake your Tshare (36 hours).
3. “Are the masonry rewards pro-rated by time? I.e if I stake three hours before the end of an epoch vs five hours before the end of an epoch, do I get different rewards?”
No, it's determined by how much you have staked at the time of printing (i.e. end of one epoch and start of the other). It doesn't matter if you stake 3 hours before or 30 seconds before the emissions occur.
4. "If I remove my $TSHARE from Masonry without first collecting my $TOMB, will it be lost forever?"
No, it will still be there to collect whenever you need.
5. "The Masonry APR dropped because we're in a 'debt phase.' What does this mean?"
A debt phase takes place on the expansion epochs that start after a contraction period where there are still $TBOND to be redeemed.
65% of Expansion during Debt Phase is allocated to the Treasury Fund to prepare for the TBOND Redemption. This amount is still reserved whether or not TBOND holders are redeeming bonds or not.
Once TOMB in treasury is sufficiently full to meet all circulating bond redemption, expansion rates will resume to normal.
6. "If we're in a debt phase, how long will it last until Masonry continues printing as normal?"
The debt phase will last as long as is necessary to adequately pay back outstanding $TBOND debt. Please keep in mind that the DAO will also need to collect a little extra, as there needs to be a cushion to cover the bonuses when people redeem $TBOND over peg.
There's no exact way of calculating how many epochs it takes, since we don't know exactly when people will redeem their $TBOND. If the debt phase is ended too early, and then the treasury doesn't have enough $TOMB to repay the $TBOND bonus, then the APR restriction would need to be turned back on.
7. "At the end of the epoch, the Masonry did not print $TOMB, and then no $TBOND(s) were issued in the pit. Why?"
There is a balanced state "at peg" when $TOMB's TWAP is between 1.00 and 1.01, and this means there is neither contraction nor inflation.
8. "If TOMB continues climbing above the price of the peg, will that influence how long the debt epoch lasts?"
Depending on the price of Tomb, the Masonry print will have to adjust to provide a buffer for any unclaimed TBOND. As the price of TOMB climbs above the peg, more TOMB needs to be distributed to the treasury to account for TBOND bonus redemption.
1.“What will happen when circulating supply = Total supply? Will emissions stop?”
Yes. Once the max supply of $TSHARE (70K) is reached, emissions stop. This is going to be in a little less than a year from the time of writing this. $TSHARE will always print $TOMB in the Masonry, though, as long as $TOMB is above peg.
2.“Why is ‘at-peg’ (TWAP between 1.00 and 1.01) the best time to provide liquidity?”
When $TOMB is pegged or close to being pegged to $FTM, it is more akin to having exposure to a single asset (single staking) than to your traditional LP'ing experience, where you would run the risk of impermanent loss if one of the tokens went up in value and the other did not.
3. "Wait, you mean that if $FTM pumps, $TOMB pumps with it?"
Let's take an example:
If $FTM pumps in price, it won't 'outrun' $TOMB.
The APR will vary in terms of its $USD value, but emissions won’t. This is something that wouldn't be possible with another 1:1 pegged asset like a stable coin LP position, where the $USD value is directly tied to the emissions. If $FTM rises in $USD value, $TOMB goes with it. Same if $FTM falls in $USD value, $TOMB will be worth less in $USD, but it won’t affect the peg. The only thing that can change the price of $TOMB in terms of its $FTM value is buying and selling it.
1.“How do auto-compounding vaults work?”
Staking either $TOMB/$FTM or $TSHARE/$FTM LPs in these vaults rewards you with more of the same LP (liquidity pool) tokens that you have deposited. They deposit your LP tokens in the same yield farms that are available to everyone on $TOMB.finance, and then, every set amount of minutes, they harvest the $TSHARE that you’ve earned, sell a portion of if, and use the proceeds to mint more LP tokens on SpookySwap, before finally depositing those LP tokens back into the $TOMB.finance pools, growing your allocation.
You can actually do this yourself if you prefer not to have to pay fees; it’s simply a service offered as a time-saver for those that don’t want the hassle of going through the whole process themselves all day every day.
Note on the tokenomics of auto-compounding: Both the $TSHARE/FTM LP and the $TOMB/$FTM LP pools pay rewards in $TSHARE: If you’re in the $TSHARE/$FTM pool, 50% of your $TSHARE rewards are sold for $FTM each time the protocol auto-compounds. If you’re in the $TOMB/$FTM pool, 100% of your reward is sold and used to purchase half $TOMB and half $FTM each time. Unlike the TOMB/FTM vault, the TSHARE/FTM vault does not put any buy pressure on $TOMB.
2. "Where else can I use my $TOMB?"
Currently, you can find various rewarded $TOMB pairs on Zoo, Spiritswap, and Summit.
1. “How can I figure out what my future $TOMB rewards will be from the Masonry?”
Simplified example for a non-debt phase: say you have 1 $TSHARE staked out of 10 total $TSHAREs staked in Masonry, so you will get 10% of the total $TOMB emissions.
So, for this example we are assuming that there is a total circulating supply of 10,000 $TOMB, the current expansion rate is at 4%, and therefore 400 $TOMB will be emitted.
You would get ((0.04 * 10000) * 0.8) * (1/10) = 32 $TOMB.
With current regulations, this is the distribution breakdown:
-80% of printed $TOMB goes to $TSHARE stakers.
-18% goes to DAO-fund.
- 2% goes to the devs.
Formula to calculate your rewards: ((ExpansionRate * CirculatingTOMBSupply) * 0.8) * (YourTShareStake/TotalTShareStaked)
2. “How long will it take for Tshare to pay itself off from $TOMB rewards, based on current prices?”
This will vary constantly as the APR in the masonry fluctuates, along with other variables such as the price of $TOMB.
For a quick estimation, however, you can do the following:
1) Take the total APR shown in the masonry, and divide that by 365 to get the daily APR. (In this example, we will say the daily APR is 5%.)
2) Multiply that daily APR by the current market price of the total Tshare you have staked to see what your daily rewards are.(In this example, we have 5 Tshares, each worth $500, for a total amount staked of $2500. Your daily return is $2500 * .05, which comes out to $125/day.)
3)Take your initial buy-in price for Tshares, and divide it by your daily rewards. If you bought these 5 Tshares at a higher price of $700, for example, in the current market conditions you will recover your initial investment ($3500) in 3500/125 = 28 days.
3. “Does a higher TVL mean a higher APR?”
The more TVL in the pool, the less APR (there's more people getting the same piece of the pie), but the higher the price of the reward (the pie) the higher the APR (better quality of pie). In other words, although the same rewards are diluted across more investors, if those rewards have a higher dollar value because of the increase in TVL, then it can actually lead to a higher APR as well.
1. “I'm invested in the project for the long term, and I feel guilty taking profits. Am I still a team player if I move profits somewhere outside of the project?”
Never put all your funds in one basket, even if it's $TOMB. Always take gains along the way. The Tomb team views it as a success if, over time, everyone gets their initial investment back into their wallets and continues investing with the profits that come after that.
Contractions and $TBOND
1. "When can I swap $TOMB for $TBOND?"
$TBOND will only become available in the Pit following epochs in which the Time Weighted Average Price (TWAP) of $TOMB is under peg. This means that $TOMB's price will have had to have been under 1 $FTM for the majority of the previous epoch in order to trigger the Pit to "open".
For example: If, during the previous epoch, the ratio of $TOMB to $FTM had been 1.2 for 5 hours, but dipped to 0.9 in the final hour, the Pit will not open, as the TWAP would be higher than 1. Conversely, if $TOMB's price is at 0.9 that of $FTM for 5 hours, but spikes to 1.25 in the final hour, the Pit will remain open during the following epoch, since the TWAP is less than 1.
The Pit will always open at the very beginning of a new epoch, and remain open for the entire epoch — the Pit can not and will never open mid-epoch — and during epochs in which the Pit is open, $TOMB will not be printed in the Masonry.
2. "What is the formula to calculate the redemption bonus for $TBOND?"
To encourage redemption of $TBOND for $TOMB when $TOMB's TWAP > 1.1, and in order to incentivize users to redeem at a higher price, $TBOND redemption will be more profitable with a higher $TOMB TWAP value. The $TBOND to $TOMB ratio will be 1:R, where R can be calculated in the formula as shown below:
To further illustrate why the longer you hold $TBOND the more profitable it is, let's take an initial $1000 investment into consideration. In this example, say this $1000 is used to buy $TOMB when $TOMB TWAP is 0.95 and then swapped for $TBOND.
If these $TBOND are redeemed when:
- $TOMB TWAP is 1.5, your investment would now be worth $1421.
-$TOMB TWAP is 2, your investment would now be worth $1789.
-$TOMB TWAP is 3, your investment would now be worth $2526.
-$TOMB TWAP is 5, your investment would now be worth $4000.
3. "I expected $TBOND to be issued in the pit, but there is none. Why?"
There is a balanced state "at peg" when $TOMB's TWAP is between 1.00 and 1.01, and this means there is neither contraction nor inflation.
4. "When can I swap $TBOND back to $TOMB?"
You can swap it back again when the following two criteria are met:
1: $TOMB TWAP is above peg and
2. There is enough in the treasury to cover it the redemption.
5. "Is $TBOND right for me?"
Like anything else in crypto, obtaining $TBOND is not risk-free. Just like in the real world, you are purchasing debt from the protocol with the expectation that you will be redeemed at a premium in the future. To date, this has occurred after all contractions, but past performance does not guarantee the same future outcomes.
$TBOND is ideal for those with a medium to long-term time preference, as it incentivizes hodling in exchange for potentially extremely lucrative rewards. If you are looking for a quick flip or have short-term time preference, $TBOND may not be the right investment option for you.
7. "Please, ELI5. Why do people keep saying $TBOND is a longer-term investment?"
Say, for example, that you buy 5,000 $TBOND at the time of writing this. That's about $1,000.
Then, say the market flips super bullish and $FTM goes back to $0.60 and $TOMB pushes up to $0.90.
You could redeem your $TBOND at that point for 11,250 $TOMB, which would be worth $10,125.
That's over $9K in profit if you hold your $TBOND.
8. "When can I redeem $TBOND for a bonus?"
TBOND TWAP (time-weighted average price) is based on TOMB price TWAP from the previous epoch as it ends. This mean that TOMB TWAP is real-time and TBOND TWAP is not. In other words, you can redeem TBOND for a bonus when the previous epoch's TWAP > 1.1.
1.“What is FTMPad and how will it benefit $TOMB investors?”
FTMPad is a launchpad/incubator for the hottest new projects on the Fantom network! As a $TOMB investor, you will have the first seat at the table. $TOMB will buy you a seat to buy a certain % of the pre-sale rights, and this $TOMB is then burned and removed from circulation. Then, you use FTM to buy the tokens based on the total allocation you’ve reserved with $TOMB. This effectively means that if you are in masonry printing $TOMB, you’re printing yourself a seat to all the newest projects on FTM. Others will have to buy $TOMB to get involved with the launchpad.
TLDR; Until now, staking in the Masonry gave you two choices for what to do with your rewards: sell, or compound. With FTMpad, you can now put your $TOMB to a third and unique use: buy a seat at the table by burning your $TOMB. $TSHAREs print you the tickets, so non-masonry participants will have to buy $TOMB to participate.
2.“I'm a dev interested in launching my project on FTMpad. What should I know?”
FTMpad serves as an incubator. You submit your project proposal, and, once governance is active, $TSHARE holders will vote on whether it will make it to the launchpad. Once your project has been voted in, the team will assist with tokenomics and other technical questions you may have. All projects using FTMpad will be adding their liquidity into Spookyswap— that's a prerequisite.
3. “What’s the advantage of participating in FTMpad as an investor? Does launching on Tomb's FTMpad mean the project has been thoroughly vetted, and therefore that I as an investor can rely on Tomb's assurance, compared to if I were to buy it from somewhere else?"
Tomb does not represent nor guarantee the particular outcomes of any investment. That being said, the Tomb team will perform thorough vetting of each project in accordance with best practices. Investors should still always do their own research.
As an early-stage investor, participating in FTMpad will give you access to an immediate discount, intimate knowledge about the project’s development before it reaches the broader public, and a relationship with the community built around it during its incipient stages.
Concerns and Panic
1. "Why can't I swap $TOMB for another token on Spooky?"
Here are couple troubleshooting tips.
-Try swapping $TOMB -> $FTM directly.
-Remove decimals so that you're trading a round number of $TOMB.
-Refresh your page and try again.
-Restart your browser and try again.
-Switch to a different RPC URL and try again.