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Author Topic: Iconomi, one investment to glue them all  (Read 1976 times)
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March 23, 2017, 03:07:00 AM

This will be a long post, but hopefully it does make some sense. I think Iconomi will head to $1 or more by the end of the year (currently $0.38 as of this post). Long term, it has the potential to reach $5 or even more. Disclaimer: I am an early ICO investor and do own some ICN.

To give a bit of background, I've been interested in cryptocurrencies since 2013 (and have been on this forum since early 2014). I mined lots of altcoins. I've seen the rise of Litecoin from $2 to $50, and likewise the craze of Dogecoin. I've had my fair share of BTC-E pump and dumps (Novacoin, I'm looking at you). I've lost some bitcoin to the Mintpal hack. I was around when Monero and Ethereum were just about $0.50. Unfortunately, I did miss the first boat with Monero and Ethereum (especially Monero as one of the early underrated coins that had good technological innovations).

Now I've seen a lot of projects but as of now, I truly believe that Iconomi, fundamentally, is one of the most promising projects of 2017 (My other choices are Ethereum, Monero, and Augur). Iconomi right now is very underrated, especially lately, since it hasn't grown like many of the other Ethereum tokens and altcoins. I think it's partly because it's not doing something extremely cool or cutting edge like some ETH tokens, but partly also because of various communication issues involving the Iconomi team (in particular, there is an expectation of launch by Q1 2017, which is as of now still uncertain). Despite this, I do still think that Iconomi is one of those undervalued gems that everyone has overlooked. Iconomi is kind of a different beast in that it's not bringing the most innovative tech (for example, with Augur's decentralized prediction markets). But I strongly believe that Iconomi will be instrumental in bringing the average investor into the crypto space by making it very easy to invest. Essentially, it's the glue that connects traditional investors to crypto markets.

First, I do want to mention that, as you may already know, Iconomi hasn't launched yet (it's in beta), so ICN is currently only a token with no real value. Once the platform is launched, then only will ICN have any real value through dividends. Until then, any value to me is solely due to traders' speculating and general expectations on what the Iconomi team will provide updates on and what they will or will not deliver. I'm not worried about slight price fluctuations unless there are major bad news, e.g the platform launch is delayed significantly. We've seen in screenshots/videos that they do have a working product, albeit in beta. I have good reason to believe they will launch by the next couple of months at max, possibly sooner, even within a few weeks. In fact, one of their Medium articles mentions that "the more traditionally developed ICONOMI platform will make its first limited public release in about a month" which was posted on Feb 21 2017 ( Once they do release, holding ICN will start providing real value through dividends.

Assuming they do launch a successfully working platform (no major bugs or security issues) and dividends start flowing in, here is why I think it will go up:

1. There's not been any super easy way for the average investor to buy into general cryptocurrency / blockchain markets. By that I don't just mean Bitcoin, but alternate cryptocurrencies like Monero, Ethereum or tokens like Augur, Golem, etc. Sure, an investor can sign up for Coinbase, Bitfinex, Poloniex or other exchanges to buy these cryptocurrencies, but that requires more research and technical knowledge. Of course, smart investors should always do due diligence to understand the thing they're investing in, but I'm guessing many investors don't want to bother with researching every single crypto startup or currency out there. There is a reason that index or investment funds exist in the traditional finance world - for people to invest in different industries without having to research specific companies. And if Iconomi can make investing somewhat easier for the average investor, it will definitely become popular (see Robinhood, for example).

Iconomi will make it easier for anyone who believes in crypto technologies to just invest money into investment funds (e.g the ICNX or Iconomi index fund) and forget about it until they'd like to cash out. As of the beta, a user can only purchase only ICNX and only with either Bitcoin or Ethereum. However, I expect they will likely allow fiat purchases of ICNX either with the public launch or almost immediately after, due to the fact that the Iconomi team already manages Cashila that allows buying Bitcoin with Euro. This is definitely a huge benefit for average investors who don't want to deal with managing crypto assets, but want to invest in the crypto space. Right now I can't think of an easier way of doing this.

2. The recent Bitcoin ETF rejection plus possible upcoming Bitcoin hardfork has definitely spurred more interest in altcoins and has shown that there has been rapidly growing interest in diversifying into other cryptocurrencies / blockchain tech in general (Monero, Ethereum, Dash, Augur, Lisk, etc), not only Bitcoin. Although early crypto investors have known about and invested in altcoins for many years (I myself have traded Litecoin, Monero, Dash in their early days), I've recently noticed vastly increased interest in alternative cryptocurrencies. There definitely is demand for diversification: investors will want to be able to easily purchase diversified index and performance funds.

3. First mover advantage. This is important because Iconomi could launch as the very first platform for investment fund management. If done well, they can build up a good reputation and become the de facto leader for fund management. Based on what I've seen from users on the Iconomi slack / Subreddit, it looks like the platform is pretty easy to use and intuitive, save for minor UI bugs. Unfortunately, I don't have beta access so I can't personally vouch for the beta platform.

Now, the next several paragraphs will be mostly speculation instead of only fundamentals - this is the altcoin speculation forum, after all. I think all the above reasons will lead to at least a several million USD daily volume on the Iconomi platform. Since this is kind of a new product in the crypto space, no one is really sure how well it will do. But I think that at least $10MM USD daily volume is reasonable after a half year to one year if Iconomi functions well and is marketed well. For comparison, GDAX has ~$26MM daily volume and Gemini has ~$8MM daily volume. Iconomi's platform can potentially reach that level considering it will deal in similar major crypto assets as those two exchanges, including Bitcoin and Ethereum and will allow fiat deposits. Also, I believe that the Iconomi team plans to attract $200MM within the first year, which is a reasonable target given how rapidly crypto has grown. This will only increase as the crypto space grows.

So what does the $10MM USD daily volume and $200MM of invested funds mean for ICN holders? Let's take a look:

First, we have ICNX, the Iconomi index fund. This will likely be the core investment product due to its expected stable yearly growth, although we do know the Iconomi team plan to have ICNP (Iconomi performance fund) as well as third-party managed performance funds soon after the initial launch. Let's focus on ICNX only for now. ICNX has a 3% yearly management fee and 0.1% entry/exit fee, and I assume all the fees go to ICN holders. I'm also assuming the 80/20 rule. So for ICNX, I expect a $8MM daily volume and an average of $160MM in invested money.

Yearly management fees would be 3% * $160MM = $4.8MM. Yearly trading fees would be 0.1% * $8MM/day * 365 days = $2.92MM. Assuming ICN holders get all the fees, that'd be about $7.72MM yearly.

Yearly dividends = $7.72MM / $100MM ICN = 0.0772 / ICN

At the current price of about $0.38 that is a yield of $0.0772 / $0.38 = 20.3%

This is definitely very high compared to traditional stocks which are about 2-3%, although not uncommon in cryptocurrencies. Since crypto is higher risk in general, it is normal to expect ICN to have higher dividends yield. Yet this can still easily drive the price up of ICN to at least $1/ICN and retain a respectable 7.72% dividend yield. This doesn't even include fees from ICNP and third-party investment funds. Of course, as crypto in general grows and more people use the Iconomi platform, the total yearly dividends will increase and only cause more people to buy ICN to take advantage of the higher dividend yield. Not many people will be willing to sell ICN because of potentially large dividend payments. And the value of ICN may not even have to come completely from dividends. It will be based on how well Iconomi is doing, expectations, and the value it provides to the entire crypto space. I think it could act as the benchmark app based on Ethereum. It is definitely very possible to have $1 billion or more invested in ICNX, ICNP and all third-party funds combined. If that happens, you can expect ICN to be worth $5 or more.

Of course, the above is all based on my assumption that the platform has a successful launch, and the team continues to improve the platform over time. If the market doesn't really need investment funds yet, then ICN would probably stay at the same price level or just slightly increase. But as crypto becomes more mainstream, there is definitely a need for allowing traditional investors to invest into the general crypto space, without them having to deal with managing all these crypto assets. And Iconomi seems to fill that need well.

TL;DR - Iconomi will make it extremely easy for traditional investors to buy into the cryptocurrency space. ICN tokens will grow to $1 or more because of their high dividend yield.
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Tike Myson
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March 23, 2017, 08:57:12 AM

Thanks for the interesting read, i bought some at 0.18$ and holding...
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March 23, 2017, 09:36:57 AM

Good post man!

Since this is a speculation thread and the current price is around .35 cents lets have a bet (without money)

Lets guess the

1 month
3 month
6 month
12 month
24 month

Prices for Iconomi

I am assuming once it launches the price will go to about 1USD to 1.50USD.
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March 23, 2017, 05:31:59 PM

Thanks, I hope it's informative. It's just based on my four years of experience in the cryptocurrency space and what I've seen is currently missing in the space. Many of the use cases have already been covered - Bitcoin for value, Ethereum for a platform, Monero for anonymity, Augur for prediction, Golem for computing, etc. Why not Iconomi for investing?

It's definitely one of the most underrated projects I've seen - it's not as groundbreaking tech as some other projects (Golem, Augur), there's not been much hype or marketing, and the team has had some bumps along the way (communication, delay last year). But there is a working beta product, and it will likely launch before we know it.
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