Bonding Curve

The bonding curve is a mathematical concept that defines the relationship between the price and supply of any given asset. The idea behind the bonding curve is pretty simple. While purchasing an asset with a limited quantity for example Ethereum, each subsequent buyer needs to pay a slightly higher price.

As the availability of the given asset decreases, its demand increases while bumping up the price as well.  By studying the bonding curve, early investors can make a fortune out in the end. This also led to the creation of bonding curve contracts in the crypto space.

Completely independent from the cryptocurrency exchange, these token insurance smart contracts can create a market for such tokens. The end goal of the bonding curve contracts being able to keep the price of each token directly proportional to the total number of tokens issued.