Don’t have time to read the full article? Here’s what you need to know:
- PHUB has a very limited supply of 10,000 tokens and benefits from buybacks from protocol revenue.
- The launch of BOMB Chain and our revolutionary BOMB App will bring significant inflows to the ecosystem increasing the price of our share tokens.
- Higher share token prices = higher PHUB buybacks = higher PHUB price appreciation + APR’s for stakers.
- All of the stats, figures, and numbers in the article below point to a PHUB in the $10,000 – $100,000 range. Read on to find out how!
Let me be frank – the current PHUB token price doesn’t make any sense. In this article I will draw comparisons against similar investment vehicles and markets to show why PHUB truly is currently undervalued by many magnitudes. All opinions and projections in this post are my own and not to be taken as financial advice.
In this article, I outline the case for a $100,000+ PHUB with daily buy backs up to $940,000. With PHUB’s price at $205 you may find a 487x difficult to fathom, but read on and I’m sure that will change.
The Basics – Tokenomics
Anyone familiar with PHUB can skip over this section as I have only included it for completeness of the post.
PHUB is the BOMB Money/PegHub ecosystem revenue sharing and governance token. Developer rewards from all protocols are now directed towards an automated buyback system that buys PHUB on the open market and distributes them to PHUB token stakers. I will get into projections on these buybacks later in the article.
Only 10,000 PHUB tokens will ever exist. This is extremely low compared to the supply of most tokens, and a large portion of those 10,000 are locked in vesting contracts that are slowly released over a 12 month timeframe.
For more information on PHUB tokenomics and how a healthy ecosystem will automatically boost PHUB’s price, please refer to our whitepaper: https://assets.peghub.com/peghub-tokenomics-v2.pdf
How Do You Value a Token?
The first question to be answered is how should a token be valued? Tokens are almost always either purchased due to some sort of required or wanted utility, and/or for anticipated price appreciation (in simple terms, bought because price will go up).
Let’s draw a comparison to the stock market for this one. When a public company reports earnings and future guidance, often it is the future guidance that will move the price more than the previous quarter’s earnings. The guidance is a better indicator of what the company’s business and financials will look like in the future than looking at past performance. This is more important to investors as they want insight into what the price could be in the future, which makes perfect sense.
This is why the stock market is referred to as an anticipatory market. Stocks are bought on what people anticipate happening, whether that be some big material news, price performance, or any other factor. I’m sure everyone has heard “Buy the rumor, sell the news”. This is basically a different way of looking at the fact that a stock’s price is based on future events, and chances of certain events happening. When material news/events have been factored into the price of an asset, it is referred to as being priced in. Simply meaning, the current price includes the chances of the future event being successful/happening.
How Does This Apply To Crypto?
Crypto is very similar. Investors buy tokens they believe will go up. Many tokens only go up due to buy pressure/demand from investors. Tokens typically require a strong utility in order to keep investors buying, otherwise the token tends to just pump and subsequently dump hard once the hype ends.
PHUB is very different for a few reasons, all explained in the Tokenomics document. The premise of the PHUB tokenomics are based roughly on two successful tokens: Yearn Finance and the Beefy Finance token. They both have a low supply and have mechanisms for automatic buybacks on the open market.
PHUB adopted a similar low supply and buyback system, but took it to the next level. Only 10,000 PHUB tokens will ever exist, and 100% of all developer rewards (denominated in protocol shares), plus 5% of all minted peg tokens, go directly to buying PHUB on the open market, and are distributed to PHUB stakers.
Enough Already, Let’s Look at Numbers!
To determine what an investor would feel is a fair market value for PHUB at this moment, we need to look at what the future of PHUB could look like, and what the chances are of this particular future happening.
Let’s use three different scenarios for buybacks:
- Ultra-conservative, meaning we have only 1 protocol that is partially healthy. This would be if everything goes wrong.
- Average, although I consider this conservative, meaning 1 or 2 protocols are very healthy (maintaining a good peg, printing consistently), and the other seigniorage protocols are semi-healthy, printing occasionally.
- Optimistic, where all protocols are printing and share prices are doing well. This is, of course, the state we are targeting and what our comprehensive strategy is geared towards – bringing health to all parts of the ecosystem.
Buyback Amount Scenarios
|Ultra Conservative||Average / Likely||Optimistic|
|Share price of healthy protocols||$400||$5,000||$15,000|
|Rough value of peg tokens able to be used for buybacks (daily)||$500||$10,000||$100,000|
|Share tokens sold daily for buybacks (rough estimate as not all protocols have exactly the same dev reward allocation)||8||28||56|
|Approx. daily total buyback||$3,700||$150,000||$940,000|
Even in the ultra-conservative scenario, with daily buybacks of $3700, it would likely only take a matter of a couple of days for PHUB to reach $500, before quickly progressing to much higher targets. These targets, along with the daily buybacks and staking APRs, are shown below.
understand why the middle scenario is viewed to me as conservative, please check our latest BOMBShell Monday updates at our blog to see everything we have going on. This includes launching BOMB Chain and BOMB App, which will help to make us the largest crypto staking platform globally within a few short years. Blue chip crypto staked with BOMB App fuels our farms, giving protocols instant injections of massive buy pressure and liquidity.
Price Targets & Buybacks
Below, I outline a series of price targets and what prices at these levels would lead to in terms of daily buy backs and APRs for PHUB stakers. Even the $100k price target is entirely achievable based on just the “average” scenario above. APRs are based on an assumption of 80% of the total supply being staked, with buy backs calculated using the share prices above. In reality while APRs can reach incredible values, there’ll be a point there’s simply no more PHUB to buy back for rewards. By this point though the price would be so high I don’t think anyone would be complaining!
|PHUB Price||Buyback period||Ultra Conservative||Average / Likely||Optimistic|
Let’s analyze this data before we get into calculating current value based on the odds of these targets being hit.
It’s important to remember that the constant buy pressure across these scenarios will support significant price appreciation leading to more investors “FOMOing” in. Layer in the incredibly attractive APRs and the limited supply and very soon there won’t be PHUB up for grabs on the market I personally would bet that the results fall somewhere between the “Average” and “Optimistic” values, but let’s look at average to keep everything conservative, projection wise.
With a $10,000 PHUB, we would be doing 15 PHUB of buybacks daily, or 450 a month. With a limited supply of 10,000 tokens, it is impossible for the price to stay at $10,000 with that kind of automatic buy pressure. Not enough tokens in the wild to be sold to keep the price down. A whale selling all of their PHUB at once could drop its price below $10,000 temporarily, but buybacks themselves would bring it right back up.
Putting It All together – What’s PHUB Worth Today?
Investments in any crypto or stock is a bet on its future. We can take some example scenarios of ecosystem health, assign a percent chance of it occurring, and derive a price target where that bet would be a fair value. Let me put that in simpler terms: If you have a coin flip with a 50% chance of it being heads and 50% chance of it being tails, if you could pay less than 50% to enter into a bet on the outcome, it is a favorable opportunity. More often than not you would come out on top.
Let’s apply this to PHUB. Putting aside all the complexities and details of our strategy, you can think of buying PHUB as a $200 coin flip for a potential $100k. If you feel there is a 50% chance of the ecosystem hitting the average/likely scenario mentioned above, then any price under 50% of what PHUB will be in that scenario would make it a good buy.
In our optimistic scenario (which in a bull market may be conservative!), we are doing almost 10 PHUB token buybacks at a $100,000 token price. This would equate to an APR of 42.3%, in addition to all of the gains from token price appreciation. This is a scenario that could easily lead to a million dollar PHUB, or more!
I’ve covered a lot of detail so let’s wrap up with a final summary:
PHUB has a very limited supply and benefits from buybacks from protocol revenue.
Our strategy, particularly the launch of the BOMB Mobile App and BOMB Chain, is intended to bring significant inflows to the ecosystem. Because we’ll be generating returns through our seigniorage protocols we expect share tokens to appreciate massively.
Higher share token prices = higher PHUB buybacks.
Higher PHUB buybacks = price appreciation and higher APRs for stakers.
Account for all these factors and a $200 PHUB will be almost impossible to fathom in the very near future.
If you already own PHUB, congratulations – you’ve got your ticket to Pluto! I personally will be continuing to accumulate and if you’re bullish on PHUB and the BOMB Money team you may want to continue accumulating as well. If you don’t own any PHUB but believe in our success and would like to share in it, you can pick up PHUB here. Even if you’re having a glass-half-full kind of day and think there’s a 50/50 chance of success – that would still make PHUB a great buy well into the thousands of dollars.
CEO/Founder BOMB Money,