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Based on Cryptoasset Valuations by Chris Burniske
The equation of exchange: M(size of the asset base) x V(Velocity) = P(price of the digital resource being provided) x Q (quantity of the digital resource being provided)
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Read the above post first! I may have messed this up, do not take it as truth.
Copy this sheet and play around with the numbers to see how it affects the valuation.
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Please leave comments if you have any suggestions or notice mistakes.
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BLT Supply Schedule InputsSupply Schedule Output
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Blue numbers are assumptions and some values are chosen somewhat arbitrarily.MetricAssumptionYear From Launch2018201920202021202220232024202520262027202820292030
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Total Planned Supply 150,000,000 BLT Released from Public Sale that year 75,000,000
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Percent of Tokens Issued in ICO50.0%SourceBLT Released from Foundation that year 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000
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Percent of Tokens Issued to Foundation20.0%SourceBLT Released from Founders that year 15,000,000 15,000,000
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Lifetime of Foundation30 Aggregate Number of Tokens Released 91,000,000 107,000,000 108,000,000 109,000,000 110,000,000 111,000,000 112,000,000 113,000,000 114,000,000 115,000,000 116,000,000 117,000,000 118,000,000
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Percent Issued to Founders20.0%SourceNumber of Tokens in Float after Bonders 77,300,000 90,875,000 91,687,500 92,481,250 93,246,875 93,970,313 94,630,469 95,195,703 95,618,555 95,827,832 95,716,748 95,125,122 93,812,683
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Lock-up for Founders2SourcePercent of Tokens Held for Voting10%11%12%14%15%16%17%18%20%21%22%23%24%
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Tokens bonded in nodes (exchanges?) and secondary layers like RaidenTotal Percent of Tokens in Float Bonded15%Invites to Bloom50,000.0075,000.00112,500.00168,750.00253,125.00379,687.50569,531.25854,296.881,281,445.311,922,167.972,883,251.954,324,877.936,487,316.89
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Bloom team said 1 BLT held for 1yr for each. BLT/yr Charged for Invite Collatoral1.00Percent of Tokens Held for Voting50,000.0075,000.00112,500.00168,750.00253,125.00379,687.50569,531.25854,296.881,281,445.311,922,167.972,883,251.954,324,877.936,487,316.89
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district0x has 10%-20% being used for voting now, lenders want to vote!Starting Tokens Held for Voting10%Percent of Tokens Released that are Hodl'd60%59%57%56%54%53%51%50%48%47%45%44%42%
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This is basically YoY user growth.Invite Collatoral Growth per Year50%
Number of Tokens in Float after Bonders & Hodlers
13,600,000 16,296,000 16,735,500 17,162,250 17,566,875 17,935,313 18,246,469 18,468,703 18,554,555 18,432,832 17,996,748 17,086,122 15,460,683
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Percent of Tokens in Float Initially hodl'd60%
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Now modeling a yearly increase as voting means more over timePercent Increase in BLT held for voting1.20%
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Decrease in percent of BLT that is hodl'd each year
1.50%
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Blue represents a particularly subjective assumption
BLT Economy and Utility Value Output
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Year From Launch2018201920202021202220232024202520262027202820292030
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BLT Economy InputsTransaction fee charged by the network1.00%0.91%0.83%0.75%0.68%0.62%0.56%0.51%0.47%0.42%0.39%0.35%0.32%
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MetricAssumptionAnnual 3rd thing flows ($) $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
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Is this realistic? Can this be modeled?Cost per transaction1.00%Annual 3rd thing available to BLT $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
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Is this realistic? Prices should come down due to efficiency.Cost decline for transactions10.00%Annual Credit Risk Assessment flows ($) $ 13,117,104,000 $ 14,323,877,568 $ 15,641,674,304 $ 17,080,708,340 $ 18,652,133,508 $ 20,368,129,790 $ 22,241,997,731 $ 24,288,261,522 $ 26,522,781,582 $ 28,962,877,488 $ 31,627,462,217 $ 34,537,188,741 $ 37,714,610,105
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What risk will this apply to? Creidt only? Insurance? Investment?Credit Risk Asessment Global 2016 $ 11,000,000,000 Source
Annual Credit Risk Asessment flows available to BLT
$ 11,805,393,600 $ 12,891,489,811 $ 14,077,506,874 $ 15,372,637,506 $ 16,786,920,157 $ 18,331,316,811 $ 20,017,797,958 $ 21,859,435,370 $ 23,870,503,424 $ 26,066,589,739 $ 28,464,715,995 $ 31,083,469,867 $ 33,943,149,094
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Currently using only credit risk assessment.CAGR for Risk Assessment(2016-2021)9%Annual ID Verification flows ($) $ 11,344,304,900 $ 12,807,720,232 $ 14,459,916,142 $ 16,325,245,324 $ 18,431,201,971 $ 20,808,827,025 $ 23,493,165,712 $ 26,523,784,089 $ 29,945,352,236 $ 33,808,302,674 $ 38,169,573,719 $ 43,093,448,729 $ 48,652,503,615
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Bloom has the potential to handle all credit risk assessment% of Risk Assessment Addressable for BLT90%Annual ID Verification flows available to BLT $ 1,134,430,490 $ 1,280,772,023 $ 1,445,991,614 $ 1,632,524,532 $ 1,843,120,197 $ 2,080,882,703 $ 2,349,316,571 $ 2,652,378,409 $ 2,994,535,224 $ 3,380,830,267 $ 3,816,957,372 $ 4,309,344,873 $ 4,865,250,362
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BLT existing business $ - Total annual transactions available to BLT $ 12,939,824,090 $ 14,172,261,834 $ 15,523,498,488 $ 17,005,162,039 $ 18,630,040,354 $ 20,412,199,514 $ 22,367,114,529 $ 24,511,813,779 $ 26,865,038,648 $ 29,447,420,006 $ 32,281,673,367 $ 35,392,814,739 $ 38,808,399,456
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Identity Verification Global 2016 $ 8,900,000,000 Source
% Share of remittance Market Facilitated by Token
0.05%0.13%0.23%0.37%0.57%0.81%1.12%1.50%1.92%2.37%2.83%3.25%3.62%
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CAGR for Identity Verification (2016-2021)13%
% Share of ecommerce Market Facilitated by Token
0.37%0.90%1.61%2.56%3.80%5.36%7.22%9.34%11.61%13.87%15.99%17.86%19.41%
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I expect more competition here, and I dont think BLT will handle all ID verification use cases% of Global ID Verification for BLT10%Transactions Facilitated by BLT Each Year ($) $ 44,857,299 $ 117,071,793 $ 229,607,028 $ 399,667,929 $ 648,397,341 $ 998,962,257 $ 1,472,472,159 $ 2,082,196,247 $ 2,828,241,615 $ 3,695,901,379 $ 4,659,570,198 $ 5,690,737,196 $ 6,766,027,822
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Am I missing a part of the utility the network provides?Is there a 3rd thing? (2016) $ - BLT existing business $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ -
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Already including risk assessment, ID verification, voting, and invite collateralCAGR (2016-2021)0%GDP Facilitated by BLT Each Year $ 44,857,299 $ 118,136,082 $ 231,504,606 $ 402,670,693 $ 652,825,982 $ 1,005,165,026 $ 1,480,783,881 $ 2,092,881,206 $ 2,841,435,571 $ 3,711,575,609 $ 4,677,534,859 $ 5,710,682,882 $ 6,787,586,472
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% addressable for BLT0%Monetary Base Necessary for BLT's GDP $ 2,242,865 $ 5,906,804 $ 11,575,230 $ 20,133,535 $ 32,641,299 $ 50,258,251 $ 74,039,194 $ 104,644,060 $ 142,071,779 $ 185,578,780 $ 233,876,743 $ 285,534,144 $ 339,379,324
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Since we are excluding voters and other bonders, velocity should be high. Maybe even higher?
Velocity20Current Utility Value of Each Token in the Float $ 0.16 $ 0.36 $ 0.69 $ 1.17 $ 1.86 $ 2.80 $ 4.06 $ 5.67 $ 7.66 $ 10.07 $ 13.00 $ 16.71 $ 21.95
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Transaction fees generated by the network $ 448,573 $ 1,064,289 $ 1,897,579 $ 3,002,764 $ 4,428,641 $ 6,202,770 $ 8,311,721 $ 10,684,959 $ 13,193,956 $ 15,674,230 $ 17,964,660 $ 19,945,687 $ 21,558,650
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Credit Risk Market Adoption Curve Inputs
Current Utility Value of Each Token in the Float after fees generated per token*
$ 0.17 $ 0.37 $ 0.70 $ 1.19 $ 1.89 $ 2.84 $ 4.11 $ 5.74 $ 7.74 $ 10.17 $ 13.12 $ 16.84 $ 22.09
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MetricAssumption
*Keep in mind that these are CURRENT UTILITY VALUES OF TOKENS IN FLOAT. To get market value in 2018 we need to take all future utility flows of the token and discount it back. In 2028, you would also have to take into account future utlity value and discount back, which we aren't doing here. This means that actual value in 2028 should be higher than what is shown in the table above.
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There's an oligopoly now. It could be possible to take a majority of this market by replacing themBase Year20183rd thing Market Adoption Curve Output
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This is one of the biggest assumptions. I'm estimating they could get 1/3 of the marketSaturation Percentage25Year201720182019202020212022202320242025202620272028202920302031203220332034203520362037203820392040
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Start of Fast Growth 2020Output0.13%0.18%0.25%0.36%0.50%0.69%0.94%1.25%1.62%2.05%2.50%2.95%3.38%3.75%4.06%4.31%4.50%4.64%4.75%4.82%4.87%4.91%4.94%4.96%
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Take Over Time12
Percent Penetration each Year (after adjustment)
0.00%0.05%0.13%0.23%0.37%0.57%0.81%1.12%1.50%1.92%2.37%2.83%3.25%3.62%3.94%4.18%4.37%4.52%4.62%4.70%4.75%4.79%4.81%4.83%
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ID Verification Market Adoption Curve InputsSaturation555555555555555555555555
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MetricAssumption
^Adjustment year, ignore^
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Base Year2018
Credit Assessment Market Adoption Curve Output
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This is one of the biggest assumptions. Saturation Percentage5Year201720182019202020212022202320242025202620272028202920302031203220332034203520362037203820392040
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At 5% of 10% of the market, most of the value comes from credit assessmentStart of Fast Growth 2021Output0.89%1.27%1.79%2.50%3.45%4.69%6.25%8.12%10.24%12.50%14.76%16.88%18.75%20.31%21.55%22.50%23.21%23.73%24.11%24.37%24.56%24.70%24.79%24.85%
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Take Over Time12
Percent Penetration each Year (after adjustment)
0.00%0.37%0.90%1.61%2.56%3.80%5.36%7.22%9.34%11.61%13.87%15.99%17.86%19.41%20.65%21.61%22.32%22.84%23.21%23.48%23.67%23.80%23.89%23.96%
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Saturation252525252525252525252525252525252525252525252525
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Deriving Current Market Value from Future Utility
^Adjustment year, ignore^
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MetricValue
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End Year2028
This is the time over which you are holding.
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Years Between 2018 and End Year10*
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Discount Rate30%
This is the yearly return you are aiming for. I chose 30% per year, same as the original model. If you only want 10% a year, the fair price per token goes up above $2. It might be nice to show a distribution around the discount rate in the future.
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Total network utility value in 2018$142,703,555
This is the estimated fair price today to earn the discount rate of 30% each year over 10 years.
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Market Value in 2018 based on Expectations for Future Utility $ 0.95
Given the assumptions, if market price is less than this, it would be considered undervalued, if more than this it is overvalued.
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