> For the complete documentation index, see [llms.txt](https://traverse.gitbook.io/traverse/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://traverse.gitbook.io/traverse/monetary-policy.md).

# Monetary Policy

Traverse features policy constants that allow us to optimize the system.

Every time a user Mints **VERSE** on Traverse, they are actually purchasing a bond. This Bonds have different parameters. The **BCV** allows us to scale the rate at which bond premiums increase. A higher BCV means a lower discount for bonders and more protocol profit. A lower BCV means a higher discount for bonders and less protocol profit.

The **vesting term** determines how long it takes for bonds to become fully redeemable. A longer term means lower inflation and lower bond demand.

The **DCV** allows us to scale protocol buy pressure up or down. A higher DCV means more buy pressure and higher deflation. A lower DCV means less buy pressure and a weaker floor.

Profit Allocations are the only treasury variable. This allows us to choose who receives profits from the protocol.

There are no variables in the staking contract. **VERSE** and **sVERSE** are always redeemable 1:1, and profits are always distributed equally through rebase.

Another Re-layer would be our Innovative approach to handling Treasuries across multiple chains. Thus enabling us to further optimize our Cross-chain Treasuries to:

Price Stabilization

Influence Bond minting

Influence Staking rewards


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