Kucoin dividends appreciation

3 Comments

1. LogrisTheBard on 1. September 2019 at 0:45

   It all depends on the ability of the exchange to increase volume. Volume is the income source powering everything else. With the launch of V2 this year the true volume before market makers seems to be around 50-60 million a day. It’s not transparent but it’s my estimate based on the pricing structure and dividends I do see. That’s a lot compared to 5 million a day at the end of V1 but tiny compared to the volume during the peak and quite small compared to other exchanges.

   Kucoin lost a lot of market share during the bear market when they were basically silent and just adding more obscure coins without showing new features or talking about v2. They burned all of their community good will doing nothing while the price crashed to <$.50.

   Rational market forces should keep the KCS price in the 3-10% APR range but the USD dividends depend on the price. Even a substantially elevated burn rate hasn’t sustained the price. Over 700k KCS has been burnt since the LOCKKCS program. Yet the price has fallen from $1.70 to $1.40 today. At ~$.20 a day per 1000 KCS we’re running around 5.2% APR presently. This is evidence that the highly elevated burn rate isn’t sufficient and the price will need to drop further to increase the dividend APR.

   But let’s talk about 1-10 years. Pessimistically the exchange will die. Volume will wither and KCS price will slowly bleed and dividends will vanish.

   A neutral stance would assume the current volume level is sustainable. In the short term the price will continue to fall until the APR stabilizes closer to 10%. For reference this would be ~$.75-$1 KCS price yielding ~$75-$100 per 1000 KCS annually. As long as you can lend DAI at greater than 10% APR, why should you hold KCS and just get less than that? The price would have to appreciate to make up the difference but that would lower the APR even further causing enormous sell pressure. The buy and burn program would have to overcome this sell pressure and you can’t assume that on a neutral stance as we have no data to support that.

   An optimistic viewpoint would depend on the volume greatly increasing or generous LOCKKCS program or equivalent. This could be due to an epic bull run in the next 5 years, captured market share for whatever reason, or substantial loss leading external investment. If we take the volume numbers of Kucoin from the last bull run as a baseline we could see triple the effective volume we do today. So >$3 KCS and at least. At 3-10% APR that would be $100-300 annually per 1000 KCS.

   A moonboi viewpoint would take Binances volume as the baseline. 900 million USD or almost 20x the current volume. Dividends of $4 per day per 1000 KCS and a staggering price of at least $14 and upwards of $40.

   That should pretty much cover all you need.

   
   
   
2. enough4all4ever on 1. September 2019 at 0:45

   Based on the most recent pay outs you will recieve about 0.14 KCS each day for holding 1000 KCS.

   So you’ll get $0.20 per day.

   
   
   
3. IloveSonicsLegs on 1. September 2019 at 0:45

   About 85% give or take per year at these rates so 800-850 KCS tokens per year with 1,000 KCS held on exchange