BondZero

Bond Zero: Advanced Zero Coupon Bonds with Uniswap V4 Hooks Bond Zero revolutionizes DeFi yield trading by enabling users to split yield-bearing tokens (YBT) into two distinct components: Principal Tokens (PT) guaranteeing 1:1 redemption at maturity, and Yield Tokens (YT) capturing all generated yield until expiration. Built natively on Uniswap V4 Hooks, the protocol delivers unprecedented liquidity efficiency and seamless trading experiences.

Core Innovation The protocol's innovation lies in its native Uniswap V4 integration through custom hooks, enabling atomic PT ↔ YBT swaps to trade freely before expiry and post-maturity PT tokens are automatically redeemed at exact 1:1 rates with zero slippage, while concentrated liquidity provides optimal capital efficiency.

Real-World Example Pendle Market is a real world example proving that there is a PMF for zero coupon bonds and fixed interest rate and yield speculation. BondZero innovates to create these markets more efficient using Uniswap V4 hooks.

Technical Architecture Four core components power the protocol: BondZeroMaster (central registry managing bond markets), BondZeroHook (Uniswap V4 hook providing native AMM integration), and PT/YT ERC-20 tokens representing future claims and yield rights.

Competitive Edge As the first Uniswap V4 hooks implementation for yield trading, Bond Zero offers reduced gas costs, enhanced liquidity via native AMM integration, and better capital efficiency. The protocol targets the $500B+ yield-bearing asset market, serving individual users seeking fixed income, institutions requiring predictable cash flows, and developers building composable yield strategies.

Built for ETH New Delhi 2025, Bond Zero showcases the transformative potential of Uniswap V4 hooks in creating next-generation DeFi primitives

How Bond Zero is Built Bond Zero is constructed as a sophisticated DeFi protocol leveraging Uniswap V4 Hooks to create an innovative yield trading system. The architecture demonstrates cutting-edge blockchain engineering through four interconnected smart contracts.

Core Architecture The BondZeroMaster serves as the central registry, managing bond markets and handling the PT/YT lifecycle. It creates configurable bond markets with custom expiry dates and APR rates, executes 1:1:1 token splitting (1 YBT → 1 PT + 1 YT), and calculates real-time pricing using the mathematical formula: PT Price = 1 / (1 + r*t).

The BondZeroHook integrates directly with Uniswap V4's hook system, enabling native AMM functionality. This hook automatically redeems expired PT tokens during swaps, and manages ERC-6909 claim tokens for efficient settlement.

Token Implementation Principal Tokens (PT) and Yield Tokens (YT) are implemented as standard ERC-20 contracts with specialized logic. PT tokens guarantee 1:1 redemption at maturity and trade at present value discounts, while YT tokens capture all yield rights with complementary pricing (YT Price = 1 - PT Price).

Development Stack Built with Foundry for development and testing, the protocol uses Solidity for development and testing.

The entire system demonstrates how Uniswap V4 hooks can revolutionize DeFi primitives, combining mathematical rigor with practical utility for next-generation yield trading applications.