Been noodling on this Bybit $BIT token for some time. Haven't formed a strong view yet, but I think it might be the cheapest trailing FDV / stakeholder rev. project in the exchange sector today. @QuirkyQwerty_ had a good post about it a week back:
https://twitter.com/QuirkyQwerty_/status/1439033203243716611
To put it in context, the CEX clears $8-10 Bn of futures volume / day on its gross fee of 5 bps translates to almost 2.5-3 mm of cash (50% of gross fee) going directly into Bitdao treasury / day, almost $1 Bn / year. The treasury already has ~$500+ mm ETH/USD + ~$4 Bn of BIT.
In TradFi speak, $BIT = stonk at 15-20x P/FCF w/ a bal sht of 500 mm cash & can use its 4 Bn $BIT to do deals. 1 thing to note is that while gross fees is 5 bps, after rebate / ref, disc, etc net-fee could be ~2.5-3.5 bps: Bybit is flowing most of its gross profit to Bitdao.
...an interesting decision as this effectively makes $BIT treasury Bybit's balance sheet, perhaps by design (Bybit still owns 60% & 30% retained within DAO = effective control).
Thus, highest EV play for Bybit would be to:
- run the CEX harder, and
- allocate $BIT treasury well
Thus, highest EV play for Bybit would be to:
- run the CEX harder, and
- allocate $BIT treasury well
By extension, $BIT's discount in valuation also hinges on following factors concerning these pts:
- Is CEX futures growing?
- What about regulation?
- Treasury & token linkage indirect, any means to close discount? (unlike FTT burn)
- Can they invest / allocate treasury well?
- Is CEX futures growing?
- What about regulation?
- Treasury & token linkage indirect, any means to close discount? (unlike FTT burn)
- Can they invest / allocate treasury well?
In ideal state of world, $BIT becomes a DCG / Berkshire equiv. -- buyback isn't highest ROIC, instead use CEX cashflow to allocate & incubate best projects to hypercharge book value.
...& eventually, allow $BIT holders to redeem at NAV by burning their tokens to establish ties.
...& eventually, allow $BIT holders to redeem at NAV by burning their tokens to establish ties.
Those are just my pontification of coz -- allocating capital and being able to "get the banana out of the jar" are easier said than done.
Community-driven asset manager is hard. Delegating power to a council to ape millions when majority owner has veto power is even harder.
Community-driven asset manager is hard. Delegating power to a council to ape millions when majority owner has veto power is even harder.
But the potential is there, $BIT can already be one of the largest VC / long-only funds in the space by size if they want to be, and with $2-3 mm "subscription" coming in every day, they can (& maybe should) spray into the best deals leveraging reach of its parent Bybit.
...and meanwhile buidling all the important tooling for the ecosystem (DAO tools, insurance backstop, incubator program, legal guidance & support, etc).
The next key steps would be to design structure, incentive, and actionable boundaries to elect someone to lead.
The next key steps would be to design structure, incentive, and actionable boundaries to elect someone to lead.
Given the size and scale of Bybit, I would imagine the decisions need to be dealt carefully (especially with the regulatory landscape on both CEX and this token). The changes made would probably have to be community driven.
Nonetheless, a highly interesting DAO to watch out for.
Nonetheless, a highly interesting DAO to watch out for.
• • •
Missing some Tweet in this thread? You can try to
force a refresh
