A Bond Token becomes a dollar. Not as an analogy — BT-USDC redeems exactly 1:1 against USDC at maturity, by Fira's protocol design. On May 7, 2026, this happens for the first time in production: the PT-USDe and PT-sUSDe markets reach their settlement date.

The convergence is not an emergent property of the market. It is Fira's settlement mechanic — a dual-rail design that turns a discounted instrument into a fixed rate, on a defined date.

The setup

Both markets opened with PT-USDe and PT-sUSDe — Pendle Principal Tokens for Ethena's yield-bearing dollar — as collateral. Borrowers minted Bond Tokens (BT-USDC) backed by their PT collateral, then swapped those BTs for USDC at a discount on Fira's fixed-rate AMM. That discount embedded the fixed cost they would pay at maturity. Lenders performed the inverse: they converted USDC into BT-USDC at a discount, locking in a return realizable at expiry.

Parameters set at deployment:

• LLTV: 90% / Max LTV: 89%

• Liquidation penalty: 3.1%

• BT cap per market: 1M

• Grace period after maturity: 24 hours

What happens at maturity

A Bond Token is a zero-coupon instrument. Its face value is 1 USDC. Before expiry, it trades below par because the holder must wait to redeem. As maturity approaches, the discount narrows. At t = T, the conversion rate converges to 1:1 — the price of a BT equals the price of a dollar.

Settlement on Fira does not depend on the AMM alone. After expiry, the protocol opens a primary market: BT-USDC holders redeem 1:1 against USDC via FW-USDC, and borrowers can mint BT-USDC by depositing USDC to repay. This dual-rail design — secondary AMM before maturity, primary mint/redeem at and after — eliminates the risk that a thin secondary book delays settlement at the moment it matters most.

The convergence is therefore guaranteed by mechanism, not by liquidity. That distinction is the entire point.

For borrowers — action is required

The action is straightforward but it must be taken. Open the Fira app at app.fira.money, navigate to your open position in the PT-USDe or PT-sUSDe market, and repay the outstanding BT debt. The amount due equals the BT face value (1 USDC per BT), unchanged across the life of the loan.

Repaying before May 7 closes the position at the cost locked at origination. The implied rate paid is determined by the discount at which the BT was originally swapped for USDC — and that cost has not moved since the day the loan was opened.

The grace period — what it is and what it isn't

After maturity, a 24-hour grace period applies. This is operational margin built into the protocol — a final manual window for repayment, not an extension of the fixed-rate guarantee.

Positions still open after the grace period are force-liquidated automatically. A 3.1% liquidation penalty is applied to collateral. There is no further window after that.

The structural point matters. A fixed rate is a contract with two parties: the protocol guarantees the rate; the borrower must close the trade. Failing to repay is not a passive default — it triggers the liquidation rail by design, because the system must reconcile every BT against actual USDC at expiry. The mechanism that makes the fixed rate enforceable is the same mechanism that liquidates positions left open.

For lenders

Redeem BTs 1:1 against USDC via FW-USDC after maturity. The realized return equals the difference between USDC paid at origination and USDC received at redemption. This realized rate matches the implied rate at the time of purchase — for positions held to maturity. Positions exited earlier on the AMM realize the prevailing market price, which may sit above or below the originally locked rate.

Why this matters

DeFi credit operates almost entirely in floating-rate primitives. Rates change every block. There is no maturity, no term structure, no curve. The cost of borrowing today and the cost six months from now are not connected by any contract — only by the assumption that the model holds.

A fixed-rate market with a defined maturity changes that. It does not promise a better rate; it promises a known one. The price of time becomes legible. The risk of duration mismatch becomes manageable. Treasuries can match cashflows to commitments. Structured products can build on a stable yield curve.

Fira's mechanism — BT for principal, CT for yield, FW for the wrapping rate, settled through a dual-rail AMM-then-primary design — is what makes this guarantee enforceable. The first maturity is the moment that enforcement becomes operational, not theoretical.

Track the next ones

PT-USDG matures May 28. APX-USD follows roughly a month after. Each maturity tightens the curve, validates the mechanism, and adds a new reference point to the onchain rate structure.

Follow @Fira_Lend on X for ongoing updates — rate moves, supply caps, upcoming expiries.

Documentation: docs.fira.money

App: app.fira.money