Some decent returns amongst the top IDOs / IEOs this week for the first time in weeks.

1️⃣ Let's do some quick maths:

• You're a new NFT marketplace on an unlaunched chain.
• You want to sell 5,000 Access Tier NFTs at $250 each.
• You charge 5% fees on transactions.
• You give 20% of that fee to NFT holders.

How much volume would you need to have in order to make your NFT buyers profitable?

$125M.

That's more than Opensea in the last 3 months, with a volume of $122.9M.

2️⃣ Now, let's do a quick thought experiment:

What do you think will happen when these NFT buyers realise it will take them ∞ months to become profitable?

You'll drown in FUD.

Token ⤵️
Reputation ⤵️
Your future ⤵️
Regulators 👊🚪

Which type of token modelling is better for you?

→ Deterministic: $ w/ Excel. Ok for a high-level overview.

→ Stochastic: $$ w/ Machinations. Allows randomness and recursion to see how variables affect a token.

→ Agent-based: $$$ w/ cadCAD. Models individual actions with capacity for super complex systems.

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With AutoLayer and MetaVirus featuring for a second week in a row, we only see 1 new IDO lined up. Is the market slowing down?

How to increase token price post launch.

Can you spot the 2 problems?

1. Obvious - very short vestings. Inherently not a concern if the FDV is small and allocation minimal, but given the $30M FDV and average 22% allocation, can cause sell pressure problems.

Solution: lengthen vestings, or if raise confirmed already (like with our client above), then increase liquidity allocation to absorb selling.

2. Strategic round has less discount, but total vesting is almost half of Private, making the latter extremely unattractive.

Solution: lengthen Strategic vesting, as shortening Private would cause greater problems a la point 1.

Despite the market wide upturn we're still seeing some big dumps this week.

There's once more been many opportunities to find a 2x investment, especially in the meme sector.

After calculating net buy pressure as a function of the utilities, economy, and financials, we can, to the best of our ability, conclude that, ceteris paribus, the token will retain $34M in value, giving us a fair FDMC. Next: work backwards to build the rest of the tokenomics.

Token holders (random traders, speculators, etc.) can be acquired very quickly & cheaply, and they add a lot of initial value (token holders, DAU, volume, TVL, lower sell pressure), however, you have limited time to get real users to take over token holders before the latter leave for a shinier project, dumping your token to $0.

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Dual token economies are useful in cases when your token, that typically will experience significant price volatility, needs to be stable. But how do you get around the conflict of interest between different token holders?

You have to tie their values together directly or indirectly - e.g. don't split up the token holders in governance proposals, or make the actions of one boost rewards for the other and vice versa.

Or force them.

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After we revamped their tokenomics, they closed their Angel round in two weeks. Can you spot the 3 problems we solved?

1. Total investor allocation is 45% - very high. Even though 15% of that is via IDO, that leaves 30% for other VCs. FDV is $65M, which means there is around $30M worth of sell pressure from investors.

Solution: if you need to raise a lot, reduce investor discounts, or increase valuations per round. But note, most projects don't need to raise as much as they think.

2. Angel round valuation is 6.5x cheaper than Community. This makes it unappealing especially to launchpads because there's no incentive for Angel round investors to wait until higher prices. Launchpads want to protect their community from dumping.

Solution: if unraised (like with client above), increase valuation of Angel, or drop FDV. 3x discount is ideal.

3. Raising $9.75M from launchpads is only possible if you go on Coinlist or Fjord (avg. size $9M, $6M, rsp.), or you raise from the top 20 launchpads all at once (wont happen because LPads want exclusivity + less sell pressure from other LPad communities).

Solution: raise this money from VCs (worse allocation optics), or conduct an ICO from your own site (regulatory concerns), or conduct a Node/NFT sale (utility/returns problems), or simply raise less (raise less). Cost benefit analysis depends on strategy, product, users, etc.

You can't copy and paste tokenomics if you're building a real, sustainable business.

Well, you physically can, but we wouldn't recommend it.

Despite investment volume being down 27% MoM, there's new capital flowing into numerous projects.

Apart from the unlock at TGE, the first 6 months have the highest quantity of tokens unlocked, with unlocks quickly levelling out after.

Over a few calls, we strategised a plan on what actions our client can take, from marketing ideas to liquidity management, to sustain buy pressure during these months, in particular just before:

• Month 4, which spikes by about 20% due to seed and treasury tranches finishing their cliffs, both of which are very likely to cause sell pressure; and

• Month 13, which sees a small but significant spike in unlocks for the next 6 months.

If you finish your seed raise but need to increase the vesting schedule afterwards, investors won't be happy. Here's 3 things you can offer to negotiate with them:

1. Increased TGE unlock.
2. Reduced cliff.
3. Reduced valuation + increased allocation.

Or, if they're still not budging, make more money and deploy more liquidity to absorb the sell pressure.

Over the past month, Polkastarter and Paid have been among the top-performing launchpads for IDO returns, averaging a 340.8% ATH return on IDOs.

While 340.8% may seem significant, the returns are much lower compared to average ATH returns on IDOs earlier this year – are we witnessing a decline in the overall potential of IDOs?

A ton of IEOs and IDOs this week, all with poor returns. But next week will be stronger.

With more IDOs this week than last week, this week’s lineup feels much more promising and complete.

When conducting an audit for this RWA project, one of the most crucial issues was that their token retains practically no value.

There were no permanent, or even temporary, token sinks in the economy:

- no lock ups (except initial vesting);
- no reason to hold tokens for a given duration;
- no buybacks/etc.

Whilst this isn't a problem per se, it will become an issue for the token when the bear market comes around and the demand for the product dwindles, meaning everyone will sell the token with no gates.

Thus, we added a few temporary and permanent sinks that give the project time to manage sell pressure, but also gamify the experience for users.