Thread by @Mike_Maddocks

1/ Huge news today, @StepNofficial dropped their Q2 earnings and they were big numbers: $122.5 Million in profits through its platform fees. A 471% increase from the $26 Million in profits from Q1.

Let’s talk buyback and burn and why it’s huge for BSC and SOL realms! 🔥

2/ Q1 spans from January until the end of March. These were building and consolidation times across the app. User increase was slow and steady, and from the ground up. Dune queries show that as of Jan 1 total active users was 54, and by March 31, had risen to 88,907.

3/ Q2 saw a much more euphoric rise in user counts as popular influencers pushed the move-to-earn narrative to the mainstream, and we saw the user counts blow up 10x to over 900,000 users at the end of June.

dune.com/queries/540557…

4/ Users flocked to the app in numbers - it’s no secret that most of them came with the GST carrot dangled in front of every new deposit. Word-of-mouth was the only necessary marketing. Now that GST isn’t a big-ticket return, new user numbers have slowed considerably.

5/ That’s the framework we’re in currently. Without new users coming in, GST isn’t being burned as fast as it is being minted and it’s dropping the price. The only way GST conditions improve without new users, is through StepN stepping in. Cue the buyback baby!

6/ We know we need a stable GST to attract more users organically. StepN has made a huge marketing push lately (BAYC collab & StepN video) with many more to come. They know what they're doing. The main goal of StepN economically is to balance new user growth and stabilise GST.

7/ StepN committed to using 5% of quarterly profits for ‘Buyback and Burn’. For Q2, that is $6.125 Million back into the economy. It’s coming in the form of Sneaker burning and GMT burning. If I was managing the war chest myself, I would align these burns directly with marketing

8/ I’ve said it before on @ktrainUSA_STEPN's podcast: StepN will perform their buyback slowly and behind the scenes at the same time that hype from the #StepnApeRealm spills over. So what will they do?

First, they will stabilise the floor prices which will stabilise GST ✅

9/ New sneaker burning will be announced tomorrow on the AMA. This new sneaker burning function will have an affect on the market and raise floor prices ✅ Whether by reducing the available supply, or by increasing demand for people who want to buy shoes now and sell at a premium

10/ Within 48-72 hours the floor will start to settle back down again. I bet my shirt that StepN holds this floor themselves. They’ll use some of the buyback to hold it, and then slowly but surely continue to rise the floor price over the next month

11/ The hope is that by timing it with new hype, new users come in and see a good return and tell their friends. If they time it properly, it could catch fire and take on another bull cycle. Remember that cycle from last time in May? It can and will happen again.

12/ $6.125 Million is a lot of dollars. If we assume they allocate 50% to #GMT and 50% to sneakers, that’s over $3 Million in shoes on the #SOL and #BSC floors. At the time of this tweet SOL is @ $33 and SOL floor is ~ 2 SOL. That’s over 27,000 shoes at this floor price on SOL.

13/ BSC is 0.56bnb at a price of $221/bnb. That's over 12,000 shoes at current floor price.

How many shoes are hitting the sell market now?

I'm not sure I would want to sell if I have an appreciating asset. Sentiment changes quickly. Trust that StepN knows these magic numbers

14/ Clearly I am not providing financial advice, but I will share what I am doing. I am buying the floor NOW. It will likely increase again after the AMA. I am not sure we have a floor this low again. Buy to resell or buy to hold. I'm not sure which yet, but I am buying.

15/ Last time we saw #BSC floor go from 0.8 bnb to 1.5 bnb and then fall again to 1.2 bnb before falling slowly over time to 0.41 bnb. We can see how ready the market is to react as we jumped 30% overnight with the 'Buyback and Burn' announcement sending floor to 0.56 bnb

16/ We could also see some energy sharing changes come into play with the new bridge, where some form of energy sharing forces people to load up in older realms. If this happens, demand will increase again and people will need to buy back all the shoes we burned via enhancement.

17/ Overall, I am super bullish on #StepN for the future. I expect that we will indeed find a floor that is stable and when marketing brings home the new users, #GST will even perhaps find a slow increase.

Let the StepN team who is hard at work take care of the details. 😎