# Tokens

### Tokens Overview

Snake Finance utilizes a multi-token system designed to maintain the **$SNAKE** peg to **$S** and provide governance and stability mechanisms within the ecosystem. The primary tokens in our protocol are **$SNAKE &** **$gSNAKE**,

<figure><img src="/files/7CyZm7wyHMrrWYlqK9B9" alt=""><figcaption></figcaption></figure>

### $SNAKE Token

<figure><img src="/files/LJipEHoJEImoj2vRt4BV" alt="" width="188"><figcaption></figcaption></figure>

**$SNAKE** is the primary token of the Snake Finance protocol, designed to act as a **medium of exchange**. Its built-in stability mechanism aims to maintain a peg of **1 $S** in the long run.

**Key Details:**

* **Initial Mint:** 300 **$SNAKE** were minted upon contract creation for initial liquidity, and **630,000 $SNAKE** were allocated for genesis rewards.
* **Peg Mechanism:** $SNAKE pegs to $S through an algorithm, not collateralization.
* **Tokenomics:** Supply of $SNAKE is increased when above peg, and maintained when below peg. The supply is, in theory, unlimited; but supply expansion rates are dependent on the revenue generated by the Snake Treasury. This way all newly minted $SNAKE is always 100% backed by $S in the Snake Treasury.
* **Volatility:** It may not always be valued at exactly 1 $S. **$SNAKE is not a crypto or fiat-backed stablecoin** and should not be treated as one.

{% hint style="info" %}
Note that SNAKE **actively pegs via the algorithm**, it **does not mean** it will be valued at 1 $S all times as it is not collaterized. SNAKE is not to be confused for a crypto or fiat-backed stablecoin.
{% endhint %}

### $gSNAKE Token

<figure><img src="/files/13Lgxc3kEg5Zoze0UnJe" alt="" width="194"><figcaption><p>Governance &#x26; Share Token</p></figcaption></figure>

**$gSNAKE** represents governance and protocol ownership. It also acts as a share token that reflects confidence in the protocol’s ability to maintain **$SNAKE** near its peg.

**Key Details:**

* **Initial Mint:** 310 **$gSNAKE** were minted upon contract creation for initial liquidity, and **59700 $gSNAKE** allocated towards liquidity rewards.
* **Tokenomics:** 59,700 $gSNAKE for liquidity rewards over 2 years linearly; 10,000 $gSNAKE to the Team also linearly over 2 years.
* **Epoch Expansions:** During expansion epochs, **$SNAKE** is minted based on generated revenue and distributed to **$gSNAKE** holders who have staked in **The Nest**.
* **Governance:** Holders of **$gSNAKE** have voting rights and can participate in protocol governance, shaping its future development.
* **Bootstrapping Epoch:** The initial epoch will run for **72 hours (12 epochs)** at a **0.7-0.9% expansion rate**.

### $bSNAKE (Bonded SNAKE) – HIGHLY DISCOURAGED

{% hint style="info" %}
**Please NOTE**: While Bonds are available via the contract, We HIGHLY discourage them. \
\
They have been **completely removed from the UI** on Snake Finance and only available via the contract. This is to avoid users being trapped or having funds locked. There is NO gurantee that users will be able to claim bonds in the future.
{% endhint %}

**Why are bonds discouraged?**

* **No Guarantee:** There is **no guarantee** that users will be able to claim **$bSNAKE** in the future.
* **Funds Lock Risk:** Bonds could leave users stuck in locked positions without the ability to redeem them.

#### **How Bonds Work**

**$bSNAKE** is issued during contraction periods when **$SNAKE’s Time-Weighted Average Price (TWAP)** falls below **1 $S**.

* **Buying Bonds:** Users can purchase **$bSNAKE** with **$SNAKE**, removing those **$SNAKE** tokens from circulation and creating deflationary pressure to help restore the peg.
* **Redeeming Bonds:** Bonds can be redeemed for **$SNAKE** when its price rises above peg, with additional rewards for holding them longer after the peg is restored.

Unlike earlier algorithmic protocols, **$bSNAKE bonds do not have an expiration date**. This allows users to hold them until conditions are favorable for redemption.


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