In this video I speak about the Wonderland Time Updates and how it mayu affect the project in the future.
I also came up with a new way to value these rapidly changing DAOs that has to do with the ratio of the treasury relative to the market cap.
What do you think about the changes to Wonderland Time?
Are you still bullish on the project?
The price of wonderland time as well as many other DAO’s has been going down dramatically over the past few months they’ve also made some significant changes to the dow which is incredibly important to understand so you can make intelligent decisions moving forward with your investments in dow so in this video I’m gonna go over my position in wonderland time specifically how that is depreciated and it may actually surprise you.
I’m also gonna talk about how I’m kind of pricing this in and evaluating these DAO’s going to compare to Olympus I’m going to talk about the changes of the dow and where I potentially see them going and my thought process on the future of these dow so first and foremost time is sitting at 2 263 right now the market cap is not correct on coin market cap so make sure to not go look on there but we’re coming down from a very significant high of almost 10,000 and now we’re down to 2 hundred and sixty three dollars the interest rate of wonderland in particular but honestly all the Dallas has been going down this is down about twenty percent since I bought it last the market cap.
You can see is at 2 billion and again the price of the dow or of time is 2 240 slightly off of what you saw on coin market cap but now they are implementing something called a wrapped memo so we’re going to get into this here in a second and why you likely should wrap your memo but I think it’s just important to understand the APY the market cap the time price the backed price per time I think it’s very very important to understand and then I’m also going to since I’m not really pricing it in time anymore.
I’m more so evaluating these DAO’s not just I do like to see the time price closer to the back price I think that you’re getting a better deal when the time price is somewhat close at least you know the back price is at least 40 of the time price that’s when I do think it is a relatively good deal to buy so in this case we are above a 40 ratio right now but to be honest what I think is even more important is since these time and memo is rebasing so quickly and it’s inflating.
You can’t necessarily judge the value now based on just time or that token I think it’s more so important to base it more on the market cap relative to the treasury balance so I’m actually evaluating these on that ratio right now so I will give you an example right here right we’re at 818 million for the treasury balance and we’re at 2 billion as the market cap of time wonderland and that gives us a ratio of 39 so the treasury balance is 39 of the market cap and if you look at that relative to Olympus’s we’ve got a market cap of 1.9 billion and the treasury balance is actually less is that 601.
So this is more like a 30 percent ratio right here so technically if you’re buying wonderland time you’re actually getting a more so a better deal if you’re looking at it just on the intrinsic value standpoint which is kind of how I like to evaluate at least a portion of these dials when I’m making my decision that doesn’t mean it’s everything.
I think it’s very important to understand also like what chain it’s on I think that’s relatively important even though like these wrapped prices of these tokens are now allow are now being bridged onto other chains very very easily and I think it’s also important to understand like the vision of the project and where they’re likely heading it and what they’re doing with their treasury assets and what they’re actually backing their treasury assets in that’s very important as well but in this video I’m not going to go way deep into that I think that’s just a very important metric to start to understand and understand that wow the time token price and ohm and all these other coins that you’re seeing you’re going to see them going down dramatically right.
This came down from 10k down to 2200 but I’m actually gonna show you my current position and how that has not changed as dramatically so let’s go ahead you guys have probably seen some of my previous videos if you have not go back and watch some of my dow videos but I first started buying time at on 12 12 of 2021 and that was when the APY like I was mentioning it’s going down right.
That was 80,000 APY you can see the current index was 5.61 and the total value locked was 1.5 billion then 10 days 10 days later on 1222 the APY was 70 000 total value locked went up current index went up as well and you can see that my memo I had 7.3 memo and then it went to 8.83 because it was rebasing now with the changes turning into wrapped memo if you look at this diagram down here let me actually move my face right here so you can see this but with this wrap memo what is happening is time is going to continue to rebase okay.
So if you go and buy time you need to stake it when you stake it it turns into memo that’s why you see up here I actually bought time but then I staked it on the app and that now turns into memo when you’re staking it that’s just what they change and memo stands for memories so and we’re gonna dive into some some recent changes here but what’s important to understand is now there’s something called a rap memo which is getting rid of this issue of the token price continuing to go down because what’s happening is people are getting really really worried when they go look at a chart of time and they see it just tanking right.
And they don’t understand that it’s rebasing and it’s inflating so technically the market cap could be going up but the price is going down because it’s continually inflating and it’s increasing the supply of the token so what they’re now doing is they’re switching and saying okay we want to continue this rebasing but we also want to give you an asset that you can just hold and it goes up in value instead of going down in value and you’re getting more of more of those even though your value could be going up.
It looks terrible on a chart price because you know most people just look at the random price and assume that that’s you know it’s the asset is devaluing when it technically could go up because it is rebasing and it is inflating so what’s happening right now you’ll see they put together this little diagram in the bottom right hand corner you see the time time clocks going up and up right.
That means it’s rebasing so the supply is is increasing wrapped memo is not increasing the amount of supply of wrap memo but the amount of time that wrapped memo is worth is increasing right so the amount of wrap memo is priced in time and time is rebasing and inflating so rap memo is directly related to time right but the time token could go down because it’s inflating or people are potentially selling it off but rap memo could actually go up in price because rap memo will continue to be worth more and more time as you can see in this box in this little diagram that they built there is more and more time in that box so as it continues to grow as a project you’re going to see more and more time being worth wrap memo.
They put it very very simply in their docs if you guys haven’t read docs on DAO’s I think it’s really really important to do this and understand what they are how the project is progressing they usually post a lot of the updates but you’ll see right here memo increases increase in amount over time while rap memo increases in price or at least it should increase in price over time okay.
So let me show you my position real quick I bought time right around forty four hundred dollars on twelve twelve and you can see that it is depreciated quite significantly it’s actually down almost fifty percent since I bought time on twelve twelve now today is 1 9 of 2022 so we’re into the next month we’ve almost been holding it for an entire month but what has happened is that price so the amount the value I invested 33,000.
I got 7.39 time tokens I then staked them since I bought them on 1212 and then I just wrapped them the other day and the wrapped memo is worth 93 000 and that gave me a point two nine two six seven if you can see right here I have point nine or point two nine two six nine one wrapped memo okay so the value of that now is twenty seven thousand dollars and I’ve actually lost five thousand six hundred and ninety eight dollars or twenty percent so you can see that if you go and evaluate the price of the token.
It’s down about fifty percent since I bought it on twelve twelve but actually I’m only down about 20.73 percent so that’s why it’s really important to track it yourself understand the value understand that the chart it’s likely going to show that it’s down much more but if you know we even if we compare it to bitcoin at least during my you know time in which I’ve owned it bitcoins down about 17 over that same period of time and my position even after staking and then rapping is still down over over that you know right around 20 so let’s go ahead and get into the changes that the owner of time has talked about on his twitter real quick and we’re not going to go through every single one of these yeah.
I highly suggest you joining their discord and also following on on twitter but he went over a few changes and to be honest he’s trying to get rid of the fud of time like I was kind of mentioning you can see his first reply on his own tweet there has been confusion about time token price action with a narrative of it going down becoming more and more prevalent by Fudsters the wonderland team has been working on education but this is sometimes not enough to reach all of our community considered how big it is so we decided to take action and shift the focus from time to rap memo.
So what I actually think is happening is I think eventually they’re going to get rid of time and it’s just going to be memo in rap memo I could be wrong they haven’t formally said that but you can see that the wrapped memo actually stands for wonderful memories what it is is the benefit of this and what the actions are we taking so you kind of mentioned here’s another major change.
First we have started to move liquidity away from trader joe which was just a decentralized exchange where you could actually swap for time and they’ve moved to sushi swap so you can actually go to sushi swap and you can swap MIM or AVAX for a wrapped memo the problem is I’ve tried to do this with a very you know a larger amount of money like in over 100 grand and they didn’t even have near enough liquidity it’s going to impact the price like 30 or 40 percent.
So just be careful if you’re trading with size make sure that you use a less amount you can only swap for a little bit of rap memo the way to get around this instead of swapping directly for rap memo you can swap for time on here and then you can take your time to the wonderland app and then you just go right up to the top and you can hit rap right up here at the top and you can wrap your memo and then it’s you know you you get over that liquidity issue where you have a huge price impact so just be aware of that you don’t want to trade a lot of liquidity in rap memo because as of now you can actually do that on sushi swap but the problem is there’s not enough liquidity.
So the price impact is huge if you’re trading size and as you can see he then went on to say market cap adjusted this should make it more clear to everyone that we are investing into rap memo and not time so again I think they are kind of moving away from time and trying to put more of the focus on rap memo so that when people go look up the price of the token they can actually get a clearer picture of how much it’s actually worth instead of just seeing it go down because it is rebasing and inflating these dowels are a really really big issue if they’re inflating and the overall market is also selling off when people are selling off and it’s still inflating that’s when you see dramatic dr drops in the price moving to this model actually does make a lot of sense for time.
He then talked about the new trading pair becoming a base layer on phantom which he actually originally started to work on the phantom chain and he is very bullish on phantom and actually I believe he’s working on a new project that is on phantom next important thing that he mentioned was the idea of the project is to expand the ratio between the market cap and the treasury creating more value for the token holders this is kind of what I was talking about if you can buy when the ratio is relatively high.
You’re getting more value because it’s more intrinsic value because there’s actually a treasury backing yeah assets behind the actual tokens that we’re buying and then if it expands that’s what’s creating more profitability for you in the token holders he then pretty much summarizes it by saying this whole new mechanic should be able to increase the amount of funds into treasury to be reinvested and reduce inflation across the board giving a lot more to Stakers and long-term wrapped memo holders so that’s about the summary of what has changed what I have done is obviously I have wrapped my memo.
It’s not a very difficult thing to do you just go right to the app you when you’re staking it you just hit wrap and I think it’s important to do this you know I live inside the united states and I would likely be charged some type of interest income on my taxes from this so if you are also in a place like the united states and you’re potentially being charged you know interest income from rebasing dow like this I believe that this is going to be a way to avoid that because you are owning a token that’s going up in value instead of printing even though it’s backed by the token that is printing right.
So I think this could actually dramatically impact your tax situation and it’s pretty much a no-brainer to wrap your memo it’s not a something that you need to really stress about and go do it immediately but it’s something that you likely want to do somewhat soon because you could again save on taxes if you do live in a jurisdiction that does charge interest income or something similar on the income that you’re getting from any type of investment whether it be interest or a bond or in this case a rebasing DAO.
I want to give you just one more quick nugget that you could potentially make more money on using but you do need to be careful because it is a form of leverage but you can actually go to abracadabra money which is a lending platform and you can actually either earn interest on your tokens and or move your rap memo over there and use it as collateral and you can get a 30 loan to value in mem and then you can just go over and take that MIM which is actually called magic internet money.
It’s just a stable coin it’s pegged to the us dollar but you can take that loan from abracadabra where you moved your rap memo over there take the loan and MIM and then you can actually go buy more wrapped memo if you want or another token it’s just a form of leverage but it is a way to actually get more out of your rap memo or time overall.
I am a fan of the changes that wonderland time has made but the thing that somewhat worries me is if they create almost like another derivative form of the token because it feels like we’ve got time then that staked amount of time is now memo and then now we have rap memo which is worth the memo but the memo is pegged to the time and if we create a fourth one where it’s some random token and then we have a staked version and we also have a wrap version of that it almost feels like we’re having.
It’s the most similar thing that I could even relate it to is like a derivative on top of a derivative on top of derivative which I don’t really like investing in things that are very complex and that are derivatives of derivatives because typically it’s not very very healthy I understand that these are not derivatives but I think that’s the most similar thing that I could potentially relate it to and that’s the only thing that worries me so if we do continue down the path where this thing is worth this thing and this thing is worth that thing and that thing is potentially worth that thing when it’s staked but this increases in value and this increases in the amount of supply and there’s a bunch of confusion between these dowels if they continue to go down that path.
I likely will not be a fan of them and I’ll likely significantly reduce my exposure to them and potentially change a few things that we’re doing in some of our d5 funds as well so that’s the only thing that I am looking out for overall again I do think the the changes of these DAO’s and you know Olympus did the same thing wonderland did the same thing I think that is important even hector has made some dramatic shifts over the past month as well which I think were very very necessary because again when the market is selling off and the token is also inflating into infinity.
That’s a really really big problem for token holders so I think on to summarize kind of the macro shift of where we’re at we are definitely at a shaky time if you guys watch my previous video for bitcoin we actually just had another green dot on market cipher on the daily which is typically a significant buying opportunity you actually couldn’t see it because my face was in the way but we didn’t print another dot.
Anyways we’re at a very significant level at 40k if we break 40k I think the DAO’s are going to continue to sell off I mean pretty much everything else will likely continue to sell off because everything typically follows bitcoin but I think it’s important one the major thing I talked about in that previous video is just de-risking by owning larger market cap coins because they typically have less risk because there’s more conviction and more capital in them so they’re less volatile and they’re likely to be sold off less hard so as of now the only projects in Dallas.
I would even consider buying are Olympus and time because they are some of the largest most respected they have the largest amount of communities behind them and they still have a pretty healthy treasury behind the platform I am still a fan of hector but really those three are really the only three I consider to be honest the only ones I’ve actually bought have been Olympus and time over the past few weeks so if you got value for this video I’d greatly appreciate you hitting the like button let me know what you think about the changes in the comments section below and if you get consistent value for my channel why not hit subscribe it is completely free I can’t wait to see you here on this next video.