Valuation of a crypto backed by assets (non-fungible): Balance between speculative value and buyback value

in #steemleo10 months ago (edited)

Native token of @steem.leo, LEO has a value due to speculations and buy back schemes. Interestingly, tokens that are bought back are mostly burned sending to @null and in some cases, to payout the delegators.

Now there is a continuous selling pressure for LEO from traders, exiting investors and largest of them, the content creators. Those sells are consumed by entering investors, traders and some cases, the content creators. However, selling from the content creators will be the biggest pressure that a token will face since the token is supposed to reward them.

However, to see the rising value for token, the sum of speculative value and buy back value should be higher than selling pressure.

The speculative value is usually spurred by the continuous developments and innovations. In this case, @steem.leo is right at the top. However, buy back value is still in progress. @steem.leo is providing incentive to great content creators to post through steemleo.com which earns ad-revenue through CoinZilla and Brave browser. There are other income generation sources too. The total revenue generated through these sources cumulatively makes up the buy back value. When buy back value along with speculative value, overcome selling pressure the token's price keeps going up.

fiat_leo.png

Probably, this is the case that happened to LEO token when it kept rising from recent low of 0.073 Steem to 0.5 Steem. However, LEO has recently settled between 0.24 to 0.3 Steem. There seems be a powerful selling pressure around 0.25 to 0.3 Steem, right now.

Now the question is when LEO's value can reach 0.3 or 0.5 Steem floor?

LEO still has pressure from airdrops on PAL holders. Due to the rise of LEO's price, beneficiary of airdrops are selling at drove from last couple of months. Though the major blows are averted but selling pressure is still there.

Due to more hits from the more number of contents from Steemleo.com platform, ad-revenue is expected to grow. Income from other sources will hopefully grow too. The biggest breakthroughs will come from the future innovative sources. Recently, there is a big clue on Discord server: it looks like LEO/Steem/SBD can be purchased through fiat using dex.steemleo.com which will generate more revenue.

If a killer innovation comes forward that can bring in huge amount of revenue, then LEO's uprising will be unstoppable. In this case, speculative value will be rampant. Until that, the team behind @steem.leo have to keep inventing and developing.

As far it goes, they have delivered more than expectation.

Disclaimer: This opinion is not a financial advice, it my personal perspective and opinion. Please seek professionals for financial decisions. This opinion is only for educational purpose.

Image sources: Most images are open sourced (e.g. Pixabay, Wikimedia etc.) with Creative common license. Some images are used with due courtesy to respected owners.

Thanks for reading.
@dtrade
Cryptominer , occasional trader and tech blogger since 2013

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Thanks for the post @dtrade. In these early days, I do not mind the selling, in fact it is welcome.

Let those who are in for the long term keep buying and powering up. Weaker hands need to be shaken out.

The key is to spread the distribution out. Hopefully there are newer people who see the potential in acquiring LEO and holding it. A few dozen of them trying to improve their stake will help to eat up the selling pressure.

Either way, I try to keep adding as much as I can. I foresee LEO being much higher in the future.

Yes, sell pressure is also good for wider distribution. For every seller there is a buyer!

 10 months ago Reveal Comment