This thread can be used to discuss the removal of Epochs & Bonds in ARTH v2.
Bonds were first introduced by the Basis Cash team as a means of creating a system that could address a decline in demand by issuing debt to reduce the supply.
In theory, bonds happen to offer a well-stabilizing mechanism to help control the price; however, in practice, they have caused more harm than good.
As we’ve seen in the earlier days of ARTH v1, ARTH Bonds (ARTHB) creates a huge sell pressure that prevented the protocol from expanding when it actually had buy demand that could’ve grown it even further. Moreover, bonds were a debt that had to be repaid at a 20% premium, which means that ARTH supply had to outgrow even the premium for the protocol to be completely debt-free.
This makes it difficult to scale ARTH to the same extent as some of the more established stablecoins, that have managed to grow to a market capitalization of $1 billion+.
The new protocol will no longer have a need for epochs allowing the protocol to be much more flexible than the previous model.