$CNT
What is CNT?
CNT is SolStrategy's "convertible note token", representing a claim against the protocol's treasury. Each CNT token represents one SOL of debt that the protocol has issued.
Similar to bonds in traditional finance, CNT is only softly pegged to the price of SOL. While there is a clear arbitrage if the price of CNT exceeds SOL, the opposite is not true. A price discrepancy between CNT and SOL is natural and expected, and a similar phenomena exists in TradFi.
Why CNT?
The primary purpose of CNT is to create a tradable market for the debt for the protocol. This enables the following additional functionality:
Users can sell their CNT to get more funds to put back into the protocol. This enables looping strategies that allows even more leverage.
Arbitrageurs can buy up cheap CNT debt if undervalued. This allows market forces to decide the true value of the debt of the protocol.
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