# Bonding Curve

A [**Bonding Curve**](https://yos.io/2018/11/10/bonding-curves/) defines the relationship between the price and token supply.

The lower the reserve ratio in a bonding curve, the higher the effect of each buy on the value of tokens. In a lower bonding curve, at a \~25% reserve ratio, each redeemed token increases the value of other tokens, due to limited supply and growing demand.

![There are many types of curves - we have chosen a quadratic bonding curve.](https://content.gitbook.com/content/QmBZIMpLnXgFOaYgbHiw/blobs/ruO4EddUovaVvai7VJ0O/Screen%20Shot%202022-03-04%20at%201.36.20%20PM.png)

We have chosen to target a Reserve Ratio of 25% in order to best reward early backers and members of $MYO, who will be purchasing tokens at a lower initial price.

As demand for $MYO increases over time through the open markets and our own client services, and the planned $MYO distributions from the Community Treasury continue to decrease over time, the price of $MYO should increase exponentially.