Bonding

How New Tool Tokens Launch

When a developer deploys a tool via the StrawberryFactory, the contract:

1. Creates a new Strawberry token instance (or upgrades an existing template).
2. Issues an associated CreatorNFT to the developer, granting them “creator rights” (i.e., receiving fee revenue).
3. Sets up the bonding curve parameters (e.g., initial price, max supply, slope).

This token then enters a pre-bonding phase. Early buyers can purchase tokens directly from the bonding curve. Sellers can also exit by selling tokens back, as long as the tool is still in the bonding phase.

How Bonding Curves Work

The BondingCurve.sol contract in Strawberry’s code determines token price based on a mathematical formula (exponential, linear, or hybrid). Key functions:

• buy(amountProtocolToken): Mints a certain amount of the tool token in exchange for protocol tokens.
• sell(amountToolToken): Burns the tool token and returns protocol tokens from the contract’s reserves.

As more people buy in, the price systematically increases along the curve. The reverse is also true—when people sell, the curve returns protocol tokens based on the current supply and price.

Incentives for Early Speculators

1. Price Appreciation: Bonding curves generally reward early entries with lower prices, so if a tool gains traction, subsequent buyers face higher costs.
2. Creator & Protocol Rewards: Fee splits on each transaction go to the creator (via the CreatorNFT) and the protocol, incentivizing ongoing development.
3. Liquidity & Price Discovery: The bonding curve ensures there is always a mechanism to buy or sell—though the price might move rapidly if large buys or sells occur.