/biz/ - Business & Finance

I did some calculations and for the first time I will have to admit $1000 EOY might not happen. It might not be even $100 ever.

We have a total of 1 billion links.

If link gains massive adoption and has for example 25k nodes worldwide, with average of 10k links staked in each, that is 250 million links staked.

Then let's say link price is 5$ each by then. So each node has 50k$ worth of link staked.

Let's assume all those nodes handle 100 million transactions per day, so it's 36,5 billion transactions per year, 1,46 million transactions per node per year, so about one transaction for every 20 seconds for every node.

If 36,5 billion transactions are priced on average 0,025$ each (which is really high compared to regular APIs but link is not regular API), total annual revenue for link network is 912,5 million $.

With 25k nodes, each will get an annual revenue of 36500$. Return on investments is under 1,5 years which is good.

With 10k links staked, each staked link will generate 3,65$ per year. Because revenue is paid in links, with 5$ link, each staked link will earn 0,73 links per year.

So the total amount in links paid for node operators is 182,5 million links.

Then let's say 40% on earned links (70 million) will be staked for future profits and 60% is sold in exchanges to buy Lambos. That means there will be over 100 million links for sale every year, that is 300k links sold every day.

Staked link amount will rise and take about 9% of total links per year, so it is going to reduce the total amount quite fast.

With that kind of volume, the price can't rise very high (to 3 figures) even passive income generated from running a node is very good. If price starts to rise, the amount of sold links will rise rapidly when node operators start to sell.

Because transactions are paid with link, rising price would reduce the amount of links paid for nodes and would also slow down staked link %, but of course also less link would be available to buy.

Thoughts?