# Bundles Protocol Overview
Invest and diversify your portfolio in a snap.
bundles.fi allows investors to access fully automated and decentralized crypto indexes.
Designed for all types of investors, from beginners to institutions, it provides anyone with the power to build a simple crypto portfolio.
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[Mechanism](/mechanism/what-is-a-bundle)
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[Performance](/performance/mint-and-burn-fee)
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[$BUN](/ecosystem/usdbun)
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[Managed Bundles - Grow your bundle and earn from it](/managed-bundles-grow-your-bundle-and-earn-from-it/introduction)
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# What is a bundle ?
A bundle is a customized portfolio of multiple cryptocurrencies, each assigned a specific weight.
These weights determine the proportion of each token within the index, for example : 40% BTC, 30% ETH, 20% USDC and 10% DOGE.
To simplify investing, each bundle is represented by a single token, allowing investors to hold a share of the portfolio as a single asset.
# Bundle token
Bundle tokens are ERC-20 tokens that give you exposure to a specific portfolio of multiple assets.
Holding a bundle token is equivalent to holding a proportional share of all the assets in a specific bundle.
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Each bundle token is unique to its respective bundle and represents a proportional share of its included assets.
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Let's take the example of the bundle bellow.
This bundle is composed of 40% BTC, 30% ETH, 20% USDC, and 10% DOGE.
If you own **$1,000** worth of the **bundle's ERC-20 token**, it's equivalent to holding **$400 in BTC**, **$300 in ETH**, **$200 in USDC**, and **$100 in DOGE**.
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Each token's price reflects both the value of the bundle assets and it s performance.
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# Mint & Burn fee
Earn on each entry/exit
Each bundle incurs mint and burn fees (up to 2.5%), paid exclusively in the bundle's underlying tokens—the assets that form the index. These fees accrue to existing holders, increasing their proportional share of bundle tokens. Whenever a user mints or burns a bundle index token, holders earn a share of those fees, effectively growing their bundle token holdings without additional investment.
Mint CORE index token by depositing its underlying tokens
# Rebalancing strategy
Volatility farming redefined
Bundles.fi employs a threshold rebalancing strategy as its core mechanism to drive bundle performance. This approach systematically adjusts asset weights to capture value from market fluctuations.
### How Threshold Rebalancing Works
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Threshold rebalancing captures value from market fluctuations by selling overperforming assets
\
and reinvesting in those with higher growth potential.
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The strategy monitors deviations from target weights, triggering rebalancing when an asset exceeds the predefined threshold (e.g., 5% deviation). It sells the overweight asset (due to strong performance) and reinvests in the underweight one.
### **Value Generation: Long-Term Dynamics**
While rebalancing does not generate immediate value, fees align with arbitraged value at execution, yielding no profit at that moment.
It enables buy-low/sell-high dynamics over time. Deviations prompt swaps that realign the bundle, capturing rebounds from market cycles. In volatile conditions, where prices rise and fall, this exploits mean reversion: selling highs and buying lows compounds gains that a static hold would miss.
Over the long term, with sustained volatility, the compounded effect of these adjustments accumulates greater value than holding unchanged weights, as the bundle continually optimizes exposure to rising trends while mitigating underperformance.
### Rebalancing Fee Extraction
Rebalancing fees are paid with [$BUN](/ecosystem/usdbun). If the bundle accumulates excess $BUN—due to repeated rebalancing or $BUN appreciation used to repurchase depreciated assets (relative to others)—15% of the fee value is extracted from the bundle. This occurs after $BUN has gained value, positioning it as a structured accrual rather than an isolated cost. The extraction is allocated as follows:
* **With a Curator**: 5% to the curator, 10% burned.
* **Without a Curator**: 15% burned.
This mechanism supports the protocol's deflationary design, reducing $BUN supply while incentivizing balanced growth, and integrates seamlessly with [dynamic threshold adjustments](/ecosystem/interconnectivity-of-bundles-via-usdbun) for opportunistic rebalancing.
### Fully automated through arbitrage
*Arbitrage is the process of buying an asset on one market at a lower price and selling it on*
\
*another market at a higher price to earn a profit.*
Arbitrage automates rebalancing when thresholds are crossed, keeping bundles assets aligned with their target allocations.
This makes the bundles entirely self managed, requiring no action from investors while keeping asset
\
weights within their target allocations.
# Rebalancing example
### The Thermostat Analogy
Imagine your home thermostat:
* You set the temperature to **20°C** (your target)
* You accept a margin of **±2°C** (your threshold)
* Heating only turns on if it drops below **18°C**
* AC only kicks in if it goes above **22°C**
Between 18°C and 22°C? Nothing happens, you're in the comfort zone.
**Same for your bundle**: you set a target and a margin, and it only rebalance when you exit the zone.
### Threshold ≠ Price Change
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**The threshold is NOT the same as the asset's price movement on the market.**
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If an asset goes **+5% on the market**, it does NOT mean it goes **+5% in your bundle**.
The threshold measures the asset's **weight** in your portfolio, not its price change. Because your other assets also move, the actual price change needed to trigger rebalancing is much larger.
### Practical Example
**Initial Setup:**
* Total bundle: **$1,000**
* Asset A: **$200** (target 20%)
* Threshold: **5%**
* Rebalancing zone: **15% to 25%**
#### If the asset rises on the market
Asset A gains **+33%** in value → $266
| | |
| -------------- | ---------------------------------------- |
| Bundle value | $266 + $800 = **$1,066** |
| Asset A weight | $266 ÷ $1,066 = **25%** |
| Result | ⚠️ Above 25% → **Rebalancing triggered** |
#### If the asset drops on the market
Asset A loses **-29%** in value → $141
| | |
| -------------- | ---------------------------------------- |
| Bundle value | $141 + $800 = **$941** |
| Asset A weight | $141 ÷ $941 = **15%** |
| Result | ⚠️ Below 15% → **Rebalancing triggered** |
#### In between?
Asset goes +10% or -15%? **Nothing happens**, you stay in the comfort zone.
# $BUN
### Introduction
$BUN is the native token of the Bundles ecosystem, functioning as a deflationary ERC-20 standard asset essential to the protocol's operations. $BUN must constitute at least 5% of the total weight in every bundle, ensuring its foundational role in index compositions. It facilitates fee payments for rebalancing activities and swaps within bundle pools, with a structured burn mechanism—15% of swap fees and a portion of arbitrage rebalancing fees—permanently reducing supply. This deflationary design enhances scarcity over time, positioning $BUN as a resilient component decoupled from broader market fluctuations.
### Why $BUN is a Compelling Asset
What distinguishes $BUN as particularly attractive within the Bundles ecosystem is its inherent stability paired with long-term investment potential. By design, its value accrual is insulated from the volatility of constituent assets in bundles, as burns occur independently of external price movements, fostering a stable peg relative to the ecosystem's fee generation while rewarding patient holders through progressive supply contraction.
* **Market Decoupling**: Unlike other assets, $BUN is not directly impacted by price variations in bundle components. It serves as a hedge: relatively steady during turbulent periods, yet appreciating as protocol activity expands.
* **Balanced Profile**: Ideal for diversified crypto portfolios, it combines short-term constancy with long-term appreciation, transforming protocol fees into accretive value for holders.
### Implementing Volatility Pumping
$BUN's integration enables the implementation of volatility pumping strategies, a mathematically rigorous approach rooted in optimal portfolio theory. As outlined in quantitative finance literature, volatility pumping exploits rebalancing dynamics to harvest gains from market fluctuations—effectively buying low and selling high through mechanical adjustments, thereby maximizing the expected logarithmic growth of wealth in line with the Kelly criterion.
In the context of Bundles.fi, where $BUN underpins rebalancing fees across volatile asset indices, this strategy becomes actionable:
* **Mechanism**: Periodic adjustments lock in upside from high-volatility periods while mitigating drawdowns, converting ecosystem-wide price swings into compounded returns for $BUN holders.
* **Practical Considerations**: Success depends on disciplined execution, low transaction costs, and extended horizons to overcome short-term convergence challenges inherent to the approach.
### Conclusion
In summary, $BUN not only operationalizes the Bundles protocol but also embodies a sophisticated asset class—stable in the near term, accretive over the long term, and strategically positioned to leverage volatility for enhanced performance.
# Interconnectivity of Bundles via $BUN
The Bundles protocol connects bundles through $BUN's value and dynamics. Rebalancing fees, paid exclusively in $BUN, generate demand during adjustments. As $BUN's weight deviates from 5%, it influences thresholds across bundles, creating a network where one bundle's rebalancing affects others.
### **Core Mechanism: $BUN's Role in Adjustments**
The 5% $BUN allocation serves as an integrated reserve for rebalancing, allowing swaps without external markets. Activity, such as inflows, outflows, or volatility—shifts $BUN's value, prompting interconnected adjustments that stabilize the ecosystem.
#### **How Interconnectivity Functions in Practice**
1. **Rising $BUN Value**:
* Bundles with excess $BUN (above 5%) sell it during rebalancing.
* Proceeds to buy underperforming assets in the bundle or related ones.
* **Effect**: Reallocates value from $BUN to undervalued assets, capturing recoveries across bundles.
2. **Falling $BUN Value**:
* The threshold lowers dynamically, enabling earlier rebalancing.
* Bundles buy $BUN to restore 5% weight, often at a discount, using overweight assets.
* **Effect**: Creates buy-low opportunities, linking bundle recoveries via $BUN purchases.
In short, $BUN makes bundles work as a whole, using shared adjustments for stronger results. See the [Rebalancing Process](/performance/rebalancing-strategy) for more details.
# Bundle pools
Bundle pools are dedicated liquidity pools for bundle index tokens, enabling users to buy or sell through a simple swap.
Anyone can provide liquidity to a bundle index pool, and earn yield based on its performance.
# Introduction
Managed bundles let anyone—from crypto fans to influencers, brands, or groups—build and run custom on-chain crypto portfolios on Bundles.fi. As the Curator, you pick the assets based on your knowledge, creating a setup that matches your view of the market and brings in others to join and benefit.
# Build Your Bundle Like Your Own Project
Creating a managed bundle is like starting your own token or crypto project, with ready-made tools for quick setup and wide reach. This setup gives you real chances: use it to grow your brand, team up with others, or link it to things like NFTs or communities. It's designed for simple growth and visibility, helping you get noticed in the crypto space and take pride in your creation.
### Customization for Identity
You customize its basics: pick a short ticker symbol, a clear name, number of decimals and marketcap for the index token that stands for the whole portfolio.
This makes your bundle feel like a real project—easy to trade, follow, and grow, just like any top crypto asset.
### Quick Hub
To make it stand out, each bundle gets its own web page (like `yourbundle.bndl.fi`), working as a clean, focused spot. You can show live stats such as bundle description, social media links, TVL changes, performance, bundle activity, and asset splits, plus a top banner with images like logos or themes.
This turns your bundle into a proper home base, great for sharing on social media, emails, or meetups—helping you pull in and keep users while showing you as a smart creator.
**Your Quick Hub page is fully customisable to fit with your bundle branding idea.**
### Limitless index horizons
Beyond crypto native baskets, Bundles enables the creation of crypto indexes across a wide range of tokenized assets. From equities and real estate to commodities and energy, any ERC-20 representation can be combined into fully automated, self rebalancing strategies.
**Tokenized Real World Assets (RWA)**
* Equities & ETFs: company shares and market indices represented as ERC-20 tokens.
* Real estate: fractionalized property exposure through tokenized assets.
**Commodities & Energy**
* Precious metals: tokenized gold, silver, platinum (e.g., PAXG, XAUT).
* Energy assets: oil, gas, electricity as tokenized instruments.
* Agricultural commodities: tokenized exposure to wheat, corn, soy, and more.
# Features
Bundles give you strong controls to protect and improve your setup, plus extra wins that make managing rewarding and flexible.
### Customise weights
Easily tweak weights or add/remove assets with smooth transitions and one-click migrations.
Adjust the weights of underlying tokens in response to market conditions, updating shares to handle market moves with gradual rollouts (7–180 days) to maintain stability.
Change the mix by adding or dropping tokens with easy tools, allowing one-click moves to new versions for everyone.
### Threshold-Based Rebalancing
Implement a threshold-based system for token weights, where you set deviation limits (0.1% to 20%).
This automatically rebalance underlying assets when they drift too far from their target weights—for example, with a 10% threshold on a 30% target, rebalancing kicks in if the weight falls to 20% or climbs to 40%—enabling a **"buy low, sell high" strategy** for stronger long-term returns.
Learn more in the [Rebalancing strategy](/performance/rebalancing-strategy) page.
### Flexible Settings Updates
Bundles empower curators to revise all configurations at any time, ensuring ongoing optimization and alignment with strategic objectives. This feature grants unparalleled flexibility, allowing adaptations to market conditions, user feedback, or performance insights without necessitating a complete overhaul.
* **Mint and Burn Fees (0.1% - 2.5%)**: Set customizable fees for minting and burning tokens to balance sustainability with user accessibility. Lower fees can attract more participants and increase liquidity, while higher settings support advanced management strategies, ultimately contributing to the bundle's economic viability.
* **Curator Fees (0% - 25% of Mint/Burn Fees)**: Allocate a portion of generated fees as compensation for your bundle management and growth. This incentivizes diligent management by rewarding your effort to grow your bundle.
* **Rebalancing Threshold (0.1% - 20%)**: Adjusts deviation limits for underlying assets, enabling adaptation to market conditions. A narrower threshold ensures precise alignment with targets by keeping assets closer to their initial weights through more frequent rebalancing, ideal for periods of low volatility. Conversely, a broader threshold reduces rebalancing frequency.
* Decreasing the threshold → gradual transition over 7 days (prevents immediate rebalancing surge)
* Increasing the threshold → immediate effect (allows quick response to market conditions)
* **Transition Period (Duration: 7 Days - 6 Months; Start: 7-30 Days)**: Define the rollout duration and initiation timeline for changes. Shorter durations enable rapid responses to market shifts, while longer periods provide stability during transitions.
Bundle settings management example
# Security and Stability Tools
#### Rebalancing Locks
You can lock rebalancing entirely during uncertain times, such as high volatility or potential exploits, to prevent any adjustments that could harm the portfolio—this gives you full control to pause operations until conditions improve.
#### Price Limits for Underlying Assets
Set a minimum price threshold for each underlying token relative to the protocol token ($BUN).\
If an asset's price falls below this level (e.g., due to a sudden dump to near zero from a rug pull or failure), rebalancing involving that token is blocked.
This acts as a hedge, protecting the overall bundle from total value loss by isolating the bad asset and preserving the integrity of the rest.
#### **Threshold Cool-down Period**
When certain critical changes are made to a bundle, a 7-day cool-down period is automatically triggered for security.
**When it applies:**
* Creating a new bundle
* Modifying price floors (setFloors)
* Deactivating the rebalancing lock
**How it works:**
* The rebalancing threshold is temporarily set to 2000%
* This effectively "blocks" any rebalancing activity
* Over 7 days, the threshold gradually decreases to reach your target/current threshold value
* Users can still mint and burn bundle tokens normally during this period
**Why it matters:** This cool-down mechanism ensures bundle stability after critical parameter changes. It gives the market time to adjust and protects bundle holders during transitions.
# How curators earn
Your profit grows with the bundle's action. Build up size and use to get the most—through group joins and market responses.
### Mint/Burn Fees
When users mint or burn your index token, a fee (e.g., 0.1–2%) applies, and you receive a share (often 25–50%) as your index token that rise in value.
### Rebalancing Fees
During rebalancing, fees are extracted as 15% of the fee value from the bundle when $BUN appreciates and exceeds its 5% target, prompting a sale against another asset. These fees are paid in $BUN and allocated as follows:
* **With a Curator**: 5% to the curator(curator), 10% burned.
* **Without a Curator**: 15% burned.
This mechanism captures excess value post-appreciation, supporting deflationary dynamics.
## Earnings Examples
### Mint/Burn Traffic
With $1M in value, and the same fees applying to burns, 1% fees make $100K total—your 25% gives $25K in your index token, growing with the assets.
### Rebalancing
You take a cut on fees from rebalances; the more liquidity your bundle has, the larger the rebalance amounts and the more fees you earn.
# Ethereum contracts
Bundles Token $BUN: [`0x695f775551fb0D28b64101c9507c06F334b4bA86`](https://etherscan.io/address/0x695f775551fb0D28b64101c9507c06F334b4bA86)\
Bundles Factory: [`0x661F8b1Ef3d24E99C461E0523Fd441Ed8d49bF19`
](https://etherscan.io/address/0x661f8b1ef3d24e99c461e0523fd441ed8d49bf19)
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Swap Factory: [`0xAcff9eee0a5522000E7141b77107359A6462E8d2`](https://etherscan.io/address/0xacff9eee0a5522000e7141b77107359a6462e8d2)\
Swap Position: [`0xC2b84f1F3B0b56c26A15C84aE3191cf487a28a8c`
](https://etherscan.io/address/0xc2b84f1f3b0b56c26a15c84ae3191cf487a28a8c)\
Swap Router: [`0x601deaa741d09145B76B8A76752324484664d455`](https://etherscan.io/address/0x601deaa741d09145b76b8a76752324484664d455)