Home · Blog · Economics & Policy · · Updated Nov 5, 2025 · 5 min read
SORA's Token Bonding Curve Dollar (TBCD) Explained
Explore how SORA's Token Bonding Curve Dollar (TBCD) became KUSD and Kensetsu — creating algorithmic stability, liquidity, and community-driven finance.
TL;DR: The Token Bonding Curve Dollar (TBCD) is SORA’s algorithmic reserve asset designed to stabilize XOR’s economy. It laid the groundwork for KUSD — the over-collateralized stablecoin of the Kensetsu Platform.
Understanding the Token Bonding Curve Dollar (TBCD)
The Token Bonding Curve Dollar (TBCD) originated as SORA’s first experiment in algorithmic monetary design — an asset created and valued entirely by the Token Bonding Curve (TBC).
It maintains economic equilibrium by stabilizing XOR’s price, building reserves, and funding development through the Economic Growth Fund (EGF).
TBCD remains an active on-chain asset within the SORA network. It can be traded on Polkaswap, used as collateral on Kensetsu, and continues to function as a governance-controlled reserve instrument tied to the Token Bonding Curve.
Core Properties
- Algorithmic and non-synthetic: TBCD’s value is derived directly from the TBC, which treats it as worth $1 USD.
- Governance-minted: Created only through on-chain referenda approved by XOR holders.
- Economic engine: Used to finance ecosystem projects via the EGF and to expand SORA’s productive economy.
- Self-balancing: When XOR is below the bonding-curve price, TBCD trades slightly under $1, discouraging redemptions and supporting price stability.
- Fee support: Around 0.5–1 % of network transaction fees are allocated for TBCD buyback and burn.
- Tradable: Active on Polkaswap and usable as collateral on Kensetsu.
Although its supply remains limited and governance-controlled, TBCD acts as a monetary buffer that keeps XOR liquidity balanced — the on-chain equivalent of a decentralized reserve.
From TBCD to KUSD: Evolution of SORA’s Stable Asset
While TBCD proved that algorithmic equilibrium could work, it wasn’t designed as a retail stablecoin.
As the network evolved, SORA extended the concept through KUSD (Kensetsu USD) — an over-collateralized, USD-pegged stablecoin built on the Kensetsu Platform.
KUSD in a Nutshell
- Collateralized borrowing: Users lock assets such as XOR, VAL, PSWAP, TBCD, ETH, or DAI as collateral to mint KUSD.
- MakerDAO-style vaults: Each vault has parameters for collateral ratio, loan-to-value (LTV), stability fee, borrow tax (1 %), and liquidation penalty.
- Peg maintenance: 19.5 % of all network fees fund KUSD buyback and burn (with 0.5 % still directed to TBCD).
- Governance & incentives: The KEN token rewards liquidity providers and governs Kensetsu risk parameters.
KUSD transforms TBCD’s conceptual model into a fully functional DeFi stablecoin, giving users direct access to decentralized borrowing and lending within SORA.
Inside the Kensetsu Platform
The Kensetsu Platform powers KUSD through vault-based collateral management:
- Vaults manage collateral, debt, and liquidation automatically.
- Stability fees flow into a reserve fund used for peg defense, KEN buybacks, and liquidity rewards on Demeter.
- Supported collateral IDs:
- XOR
0x020000...0000 - VAL
0x020004...0000 - PSWAP
0x020005...0000 - TBCD
0x02000a...0000 - ETH
0x020007...0000 - DAI
0x020006...0000
- XOR
By including TBCD as one of its collateral options, Kensetsu ties the new stablecoin layer directly to SORA’s original monetary base, ensuring continuity between generations of SORA tokenomics.
Algorithmic Central Banking in Practice
Together, TBCD and KUSD form SORA’s algorithmic central-banking model:
| Layer | Type | Peg | Backing | Governance | Role |
|---|---|---|---|---|---|
| TBCD | Algorithmic reserve asset | Nominal $1 USD | Token Bonding Curve (XOR) | XOR referenda | Ecosystem funding + internal liquidity (tradable on Polkaswap) |
| KUSD | Over-collateralized stablecoin | $1 USD | User vaults (XOR, VAL, PSWAP, etc.) | Kensetsu DAO | Borrowing + DeFi stability |
| KEN | Utility/reward token | N/A | Platform value | Kensetsu governance | Incentives + protocol health |
This system turns SORA into a self-regulating economy where supply, credit, and liquidity adjust automatically — governed by mathematics rather than centralized policy.
Why It Matters
SORA’s approach demonstrates that stability, credit, and growth can coexist on-chain without custodians or fiat collateral:
- Continuous liquidity: The bonding curve always provides a counterparty.
- Transparent governance: Every mint or burn event is decided through on-chain vote.
- Economic sustainability: Fee-funded buybacks and over-collateralization keep the system solvent.
TBCD, KUSD, and Kensetsu together show how algorithmic finance has evolved from theory into a working decentralized economy.
SORA’s Broader Vision: A Decentralized Economic System
With SORA v3 — being developed on Hyperledger Iroha 3 — expected to introduce enterprise-grade transparency and scalability for its next generation of DeFi systems, the network is poised for significant advancement.
These improvements are expected to strengthen the foundation for KUSD, TBCD, and future SORA assets that extend algorithmic monetary design across interoperable networks.
To explore vault creation or learn more about the Kensetsu system, visit the official SORA Wiki – KUSD & Kensetsu.
Key Takeaways
- TBCD is an active, algorithmic reserve tied to XOR and the Economic Growth Fund.
- KUSD expands that model into a user-facing, over-collateralized stablecoin on Kensetsu.
- Kensetsu introduces vault-based borrowing, the KEN token, and direct integration with Polkaswap.
- Together they form SORA’s multi-layered, algorithmic economic system built for decentralized growth.
FAQ
Is TBCD still active?
Yes. TBCD is an active on-chain asset. It can be swapped on Polkaswap and used as Kensetsu collateral, but its issuance and role remain governed by SORA’s on-chain policies rather than free-market minting.
How does KUSD maintain its peg?
Through over-collateralized vaults, stability fees, and a buyback-and-burn mechanism funded by network transaction fees.
What is the KEN token used for?
KEN distributes Kensetsu farming rewards and captures platform value through periodic buybacks.
What role will Hyperledger Iroha 3 play in SORA v3?
Hyperledger Iroha 3 is expected to provide a transparent, modular, and scalable foundation for next-generation SORA DeFi infrastructure once SORA v3 launches.
Related Resources
Financial Disclaimer
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