Trade utility tokens have all the earmarks of being the most sizzling new thing in crypto and they are being touted as a definitive sure thing. Following the ICO boom of 2017, a few cryptographic money trades found another chance to raise financing by giving their one of a kind computerized tokens. You wouldn’t blame the exchanges for taking advantage, would you?
Besides, these new "platform tokens" immediately got well known and considered extraordinary as they offered representation holders different advantages including:
- discounted fees for exchanging, deposits, and withdrawals
- an offer in return benefits through rewards and profits
- select access to challenges, competitions, airdrops
- casting ballot rights for trade postings
The most striking trade representation to have propelled up to this point originates from the world's most prominent digital money trade, Binance, who propelled Binance Coin (BNB) in August 2017. BNB went from only $0.11 in August 2017 to about $40 in June 2019, making it the best trade representation to date. (Find out more about the: Growth Of The Forex Market In Africa And Other Developing Countries)
Different platforms emulating Binance's example with the issuance of trade tokens incorporate KuCoin, Huobi, and Cobinhood. The utility tokens gave by these coin exchanges have accumulated a great deal of intrigue. Nevertheless, they haven't approached the achievement accomplished by Binance's BNB coin. (Learn the: 5 tips to forming the most promising coin investment portfolio)
Notwithstanding, there is presently another imminent trade utility representation called UNUS SED LEO that is given by iFinex, the firm behind well-known crypto platforms Bitfinex, Ethfinex, and Eosfinex. (Does BTC Stand A Chance Of Becoming The Worldwide currency?)
What is UNUS SED LEO?
UNUS SED LEO is a trade representation that was launched on May 22, 2019, by iFinex, the parent organization of Bitfinex, Ethfinex, and Tether. The actual representation is called LEO, and it is a utility representation to be used on present and future iFinex services and platforms. Upon its launch, it was propelled to people in general after a private deal raising $1 billion. During this private deal, the price tag of LEO was 1 USDT for 1 LEO and the complete stockpile of 1,000,000,000 (1 billion) LEO tokens were sold.
At the hour of composing LEO tokens are exchanging a $0.95 and can be exchanged against the USD, USDT, BTC, ETH, EOS, and DAI. UNUS SED LEO has already earned a lot of clout and is presently positioned at number 14 on CoinMarketCap with a market capitalization of $950 million and rising rapidly. (Do you know: What is An ICO and How Can I Make Money On It?)
What is the purpose of LEO?
Cryptographic platforms issue their trade tokens for an assortment of reasons; to draw in more clients, to profit existing clients, and to create more benefits. iFinex is the same, just as any company that launches an ICO. Nonetheless, the essential reason they gave the LEO representation when they did is that in 2018, Bitfinex's payment processor, Crypto Capital, suffered a government seizure amounting to $850 million of Bitfinex's resources. Bitfinex is still attempting to recover these resources but there is no guarantee they will have the ability to recoup them. (Investor Tips 2019: What To Include In Your Portfolio)
You see, iFinex and in particular, Bitfinex and Tether have been facing a lot of legal trouble this year. At first, the company was accused of fixing the crypto markets during the industry’s epic rise in 2017. Tether was used to buy BTC whenever the coin’s value was falling, thus creating a huge spike in value. Furthermore, Tether was also not backed by resources in fiat currency as Bitfinex had claimed, something that the company later admitted in 2018. (Do you know: Which Are The Most Influential Coin Arenas By Country?)
Come 2019, the New York Attorney General’s office filed a lawsuit against iFinex for operating in NY without a license. The suit went on to claim that the company had defrauded its clients of $850 million by sending the money to Crypto Capital. Previously, Crypto Capital was used by iFinex as a payments processor, but following the suspicious transfer the company’s accounts were frozen. To cover the shortfall, iFinex stated that it would borrow from Tether’s coffers, but there is suspicion around this too.
Along these lines, to reduce this money shortage, iFinex led a private Initial Exchange Offering (IEO) of $1 billion for its UNUS SED LEO representation. That amount was raised within 10 days by a few organizations that each contributed over $100 million and individuals who all contributed more than $1 million. This was the largest IEO of 2019 because, up to this point, the total amount raised in IEOs was $38.9 million. (These are the: Coin Regulations Around the World)
In the event that Bitfinex is effective in recouping the $850 million resources from Crypto Capital, they expressed that a sum equivalent to 95% of the recuperated resources will be utilized to repurchase remarkable tokens and afterward burn them. Add to that, Bitfinex will likewise utilize 80% of recuperated resources from a 2016 hack to repurchase and burn UNUS SED LEO tokens. The repurchasing and consuming of LEO tokens from recouped subsidies will decrease the representation's absolute inventory and drive the cost up through time. (These are: The Most Prominent Coin Hacks and Scams You Should Know)
The first part of LEO’s tokenomics includes the repurchasing and consuming of tokens referenced above. Other than that, iFinex and its subsidiaries also plan on repurchasing and burning more tokens as a component of the LEO tokenomics. iFinex and its subsidiary entities will repurchase UNUS SED LEO tokens from the market, at market rates, and on an hourly premise, equivalent to at least 27% of united gross incomes of iFinex. This burn instrument will proceed until no more tokens are in circulation. Moreover, UNUS SED LEO tokens used to pay exchanging charges on Bitfinex will likewise be scorched.
It is not unusual for a company to buy back its shares as many perform stock buybacks every so often, but perhaps the burning of these tokens may seem unusual. But iFinex states that this complex burning system combined with the representation burns on recuperated resources from Crypto Capital and the Bitfinex hack is required to make the value of UNUS SED LEO tokens rise significantly over time. (If you still haven’t heard, this is: How Libra Coin Will Change the World's Financial System)
Likewise, as expressed in the Unus Sed Leo representation whitepaper, recouped resources will be utilized to buy LEO tokens at specific occasions to anticipate abrupt market spikes, bringing about a progressively steady cost. According to the project’s whitepaper, buying back tokens and will lead to a Volume Weight Average Price (VWAP) and prevent market spikes. Considering that even the largest coins like Ethereum often experience flash crashes, this system would make LEO more stable. (Learn more about: Trade War and How It Affects Forex Markets)
Additionally, to supplement the UNUS SED LEO burn system, Bitfinex has propelled a straightforwardness activity that gives ongoing bits of knowledge into all gathered stage expenses, and ensuing LEO consumes. Therefore, LEO representation holders can view and track iFinex incomes, just as LEO representation consume amounts, openly through the "LEO Transparency Dashboard".
Why hold LEO tokens?
Unus Sed Leo is the utility representation at the core of the whole iFinex environment. This means representation holders will experience benefits over the entirety of iFinex's exchanging stages and future ventures, items, and services. The most significant of these benefits is that fees would be reduced all around when using any of the iFinex subsidiaries. This means:
- all holders of LEO will enjoy a 15% discount in trading fees, with an additional 10% if you hold LEO worth more than 5,000 USDT. Big players with 1 million USDT worth of LEO will enjoy even further discounts
- benefit on withdrawal of 25% for all LEO holders, and withdrawals are free in fiat up to $2 million for anyone with LEO worth over 50 million USDT
- monthly discounts of 0.05% if you hold LEO worth over 10,000 USDT in the previous month. These discounts rise to a maximum of 5%
From the above, you can see that iFinex is really trying to get people to stock up on LEO tokens to enjoy even higher discounts and benefits. But even if you have a few tokens, small deductions in trading and withdrawal fees can be quite helpful as trading costs can really mount up with time. This means that LEO tokens can be of real benefit to any trader or investor. (Read more on: THETA Coin Investment and Price Prediction 2020)
Would it be a good idea for you to invest in UNUS SED LEO?
A lot of investment choices depend on speculations, and you should really know what you are doing before committing any resources into the investment. However, on the off chance that you are a client and fan iFinex and the items and services they offer, being a LEO representation holder may demonstrate to be valuable. (What is Huobi Coin and its Price Prediction for 2020?)
As sketched out above, there are numerous advantages to holding UNUS SED LEO on the off chance that you exchange on Bitfinex, and an ever-increasing number of impetuses and advantages will be reported over the long haul. But you’re not reading this to learn about what discounts you might get if you keep LEO tokens in Bitfinex, so let’s get to the meat of the matter. (Gram (TON) Vs BTC in 2019: Best Worldwide Coin Fight, Pros, and Cons)
The price-performance of the LEO representation
When LEO was first introduced through an IEO, each representation was issued in exchange for one Tether representation (USDT). Since USDT is a stablecoin tied to the value of the US dollar, we can assume that the representation’s initial value was around $1. Today, it trades at less than the IEO value at about $0.95, but that’s not to say it didn’t have its moments. On June 26, 2019, LEO was worth about $2, effectively doubling in value in less than a month and reaching number 13 on the coins’ list. Its market cap also reached about $2 billion, also double the market cap after the IEO that raised $1 billion. (Do you know: How Did Tether Coin Survive The Coin Arena Selloff?)
Since then, however, it has all been downhill as all the progress was erased and the coin’s value and market cap receded to initial values. If this were any other stock, investors would have nothing to be worried about as many companies have experienced such a situation. For instance, Square Inc. was first launched at $10 in an IPO and fell to $8 in 3 months before recovering and surpassing $100. And this isn’t the only success story that followed what seemed to be a disaster. (Will Institutional Investors and Sharks Invest Massively in BTC in 2019?)
Even from a technical perspective, nothing seems too alarming because the $1 support region has continued to hold steady for weeks and doesn’t seem to be letting up. With that kind of support, it is unlikely that prices will break downward and the representation may actually be poised for an upward breakout. (Do you know these: 5 Tips to Choosing the Ideal Coin Platform?)
Besides, aside from the advantages offered to LEO representation holders, the LEO representation has solid tokenomics that are ready to see that LEO tokens ceaselessly increment in cost or if nothing else holds a genuinely steady worth. Along these lines, UNUS SED LEO can possibly be an incredible speculation. (This is: The Strategy Of Coin Whales In 2019)
Our price predictions for 2020
But this is crypto, and in this world, it takes a single slip to fall out of the public eye and into oblivion. So it is never wise to compare crypto to the mainstream stock market, and when you really start to look at the fundamentals LEO no longer looks to be recovering but rather on the brink of disaster.
For starters, the achievement of LEO is, to a great extent, subject to the accomplishment of Bitfinex and iFinex associated subsidiaries and services. Should any of these companies’ reputations suffer, so will the value of LEO tokens. Lately, the reputation of Bitfinex and Tether has been decreasing, and this is not good for the LEO representation. (Find out how PoS is working by reading the: Cosmos (ATOM) price prediction 2020)
A lawsuit was recently filed on October 6, 2019, by several plaintiffs seeking $1 trillion in damages. These plaintiffs allege that Bitfinex and Tether manipulated crypto markets causing losses of over $1.4 trillion in 2017 and 2018. Further, they claim that Tether lied about the stable currency being tied to the US dollar 1:1. As usual, Bitfinex denied the claims and any other wrongdoing. Inasmuch as the news made headlines, everyone recognizes the effort as frivolous and don’t really expect the plaintiffs to be awarded $1 trillion. (Before investing: Learn How Coin Scams Operate And Avoid Them)
The aim of the effort, though, was to draw attention to Bitfinex and its actions, which has been very effective. Today the 24-hour trade volumes on the Bitfinex exchange has fallen below $100 million when it used to exceed $1 billion. Consequently, the coin platform is now 62nd in the world when it was once among the top 5 platforms. Bitfinex shares were also trading on BNK To The Future under the ticker BFX at around $16 but now the shares are down. (To understand more about blockchain, read: The lowdown on coin)
BNK To The Future was a program to allow investors back crypto platforms in the belief they would be the banks of the future, and Bitfinex was among the most sought after. But after the company’s shenanigans, it seems its reputation is fading among investors. A $16 stock price would have implied about $2.8 billion in market cap, but now that market cap is a mere $440 million having lost 84% of the value.
In case you think this is simply because of the slump in crypto markets, think again. In the above graph, you can see that LEO really took off with a bang as investors were buying the tokens, but soon afterward they just stopped. Meanwhile, the graph below shows how much is being held in LEO tokens. Most holders of the representation have just $100 or less in their wallets, and the number of big players is negligible. As you know, you need to have a lot of LEO tokens to be able to enjoy any of the benefits, so it’s safe to say that not many people can say they are happy to hold their tokens. In fact, only between 100 and 200 people hold over $10,000 worth of LEO tokens.
These graphs paint a grim picture of a coin without much interest in the crypto-sphere, which should warn you against investing in it. But none is as revealing as the one below that shows a sharp decline in the number of active wallets holding LEO. A month after the IEO, there were about 300 active addresses, and now there are only about 17 left active. Considering that the representation now has a market capitalization of $950 million, you have got to wonder who holds these 17 addresses. Perhaps the NYAG office had it right in the first place, that the company manipulated crypto markets in 2017.
Regardless of the reason, it is safe to say that there are a lot of questions surrounding LEO and its parent company iFinex. This is precisely why you ought to stay away from both of them and run as fast as you can. Unless you need to hold LEO tokens to enjoy the discounts while using Bitfinex, there is no other reason to do so. This is a house of cards that is just about to fall and take down anyone with faith in the company. (These are the: 10 Most Important Resources to a Coin Trader)
Such a company does not fall in an instant, but it is unlikely that the value of LEO will rise in 2020 by a huge margin. In case there is a surge in crypto markets, then you may experience some similar surges in LEO, but overall smart investors are getting out of this investment, and you should too.
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