RE: Bitfinex's estimated revenue, and why I am selling my BFX tokens
As you (quite rightly) questioned my numbers, I now have to question yours. how are you arriving at the 150 mil number?
If we give it a revenue to valuation ratio of 10x (which is massive) bitfinex would need to have a revenue of $15 mil a year. but then you can add some for the potential, but bitfinex does not have a unique business or business model that gives it first mover advantage or protects it against competition so I don't see any reason to give it any 'potential bonus'.
Also part of my point was that I don't see bitfinex giving up 50% of total equity.
I do see them managing to pay back if cryptos increase in value and/or bitfinex increase market share, but if they fail to do a combination of these there is a real chance of the value of bfx going to 0.
Also not mentioned is the opportunity cost of having money locked up, say 5% a year, so if they manage to pay back $1 in 2 years you are only getting 90.7% of the value of that $1 now, higher or lower if you feel you can make more or less than the 5% a year
https://www.reddit.com/r/BitcoinMarkets/comments/4x4qlx/bitfinex_company_value/
I read the above thread several days ago and thought I'd share as a starting point. The bitcoin space is red hot regarding venture capital per the many funding rounds in private companies such as coinbase. This is a growth space and it should be valued as just that.
That said, Bitfinex has taken a massive body blow and we all know any investor will expect more equity for less $ at this point in time. I know there are interested parties, however I have no idea what the details look like. I also know there are many token holders who would love (even now) to own a piece of Bitfinex going forward.
I believe their rev number leans towards 20 million yoy, however we all know it will take some time, trust, and proof for customers to return in full force. I suspect Bitfinex can and will actually be the hero when this is all said and done. If so, their growth curve will go parabolic. These are simply assumptions on my part and offer little to no value in this discussion, but I truly believe this will be the case.
I'm guessing (yes, another assumption) 30%+ of the tokens will be taken private via an equity stake. I HIGHLY suspect some folks with deep pockets are actively buying the tokens to get a decent sized equity stake through the discounted back door. Some of these "folks" were interested in Bitfinex before the recent event and they will see opportunity.
These are the folks who still see value and a discount in the current token price. I also think BFX will receive a cash investment and most of the investment will go towards a decent sized payment towards the token holders. The above coupled with future earnings potential can and likely will lead to the complete repayment of the tokens. This will catapult BFX into the most trusted exchange as they capitalize on a big stumble.
My market cap guess obviously includes the tokens at a $1 valuation. I'm including their debt in my above figure.
Phil Potter also stated they are willing to "sell a large chunk of the company if that's what it takes to make customers whole." 4:07