Analysing the #Tezos #ICO & Potential #XTZ Future Price
The ICO raised 65,635 BTC and 361,122 ETH, which at current prices is $226,827,513. They’re of course suffering from the recent “crash” (really just a small drop), but it’ still the biggest initial coin offering ever, by more than $75 million. (They were well over $230 million at one point.)
I’ve no idea how many XTZ have been created, but if we take the average over the time period (5500) and weight it higher (because more people bought in at the beginning) then we’d be looking at about 5750 XTZ per BTC. Dividing $224,827,513 by the current BTC price ($2365) we get 95,064.50 BTC contributed. (Accounting/converting for the ETH as well.) At 5750 XTZ per BTC, we get an approximate total number of XTZ at 546,620,875. Given that they should have priced at approximately $0.40 per XTZ (based on the prices I paid for mine at the beginning), and this gives us a value of $0.41 per XTZ, the number isn’t too far off! (It’s reasonable also given that not everyone paid the same as I did, as some people purchased later.)
If we take the number of 550,000,000, we get a price per XTZ of $0.40, which is where we’d expect to be. It would seem that’s about how many there will be at the start.
The tougher part to analyse is the potential market cap – especially given that they will technically be unlimited in supply. We can look at a couple of existing examples of market caps, both where the supply is limited (Bitcoin/Dash) and where it isn’t (Ethereum/Ripple). In the former case, Bitcoin has a market cap of approximately $40 billion. Dash is at about $1 billion. Ethereum has a market cap of roughly $20 billion, and Ripple is at $7 billion. If we look at the average, which isn’t necessarily a good estimation, Tezos would have a market cap of somewhere on the order of about $17 billion. More likely, though, is that it will likely end up somewhere between Dash and Ripple, but probably closer to Ripple. If we estimate that it ends up with a $7 billion market cap, the initial 550 million XTZ would end up being worth about $12-13 per XTZ, and you can extrapolate based on those numbers – about $6-7 for a market cap of $3 billion, but closer to $20 if you get into the $15 billion range. That of course doesn’t account for any exuberance, and likely underestimates where it will go if there are speculative aspects to its price curve as there have been with other cryptocurrencies.
Of course, this is entirely speculation at the moment! However, based on the enthusiasm around the ICO, I don’t think it’s entirely unreasonable speculation. Thoughts? sayhi @ thomasquinlan . com