Wormhole serves as an open-source interoperability platform for blockchains. It enhances connectivity across multiple blockchains by allowing secure cross-chain messages and transactions. The platform is pivotal in transferring over $40 billion worth of value, engaging over 2 million daily cross-chain messages across more than 30 blockchain networks.
Wormhole is backed by major capitals such as Jump Crypto, Coinbase Ventures, Multicoin Capital, and others. Wormhole secured $225 million in funding, establishing its valuation at $2.5 billion (last round valuation).
Wormhole recently launched its token – the W token – on almost all top crypto exchanges. Nearly 400,000 users were airdropped W tokens on day one. Initially launched on Solana as an SPL token, the next plan is to make a dual transition to an ERC token. Following this transition, multi-chain staking is expected to be introduced.
Explain: What is Wormhole?
Wormhole is a protocol that facilitates message passing between blockchains, allowing developers to integrate and utilize multiple ecosystems for cross-chain applications. It is not a blockchain or a token bridge itself, though it supports functionalities like token bridges through other built-on protocols.
Wormhole can be used for various applications, including:
- Cross-Chain Exchanges: Developers can create exchanges with Wormhole that allow deposits from any connected chain, increasing user liquidity.
- Cross-Chain Governance: It enables NFT collections on different networks to conduct joint votes on proposals using a unified “voting” chain.
- Cross-Chain Gaming: Games developed on networks like Solana can issue rewards and NFTs on other networks, such as Ethereum, leveraging Wormhole’s connectivity.
Wormhole Tokenomics
- Total Supply: 10 billion tokens
- Circulating Supply: 1.8 billion tokens (18%)
- Locked Tokens: 82% are locked, to be gradually released over four years.
- FDV (at $0.66): $6.6 billion USD.
- Current Marketcap: $1.2 billion USD.
- Valuation: $2.5 billion USD (fundraising).
The token touched $1.8 on the very first day (18 billion USD valuation), and the price has dropped 63% since then. Many retail investors now think Wormhole is a bad investment, but is it really?
Wormhole – MONAD Connection – Rumors
- Founder’s Investment: The founder of Wormhole has made a strategic investment in MONAD, showcasing a broadening of interests and support within the blockchain ecosystem.
- Potential Airdrop: There are circulating rumors that staking Wormhole tokens might qualify participants for a MONAD airdrop, potentially adding value for token holders.
Wormhole staking is being developed.
Currently, there are no uses for the W token, but a DAO will be formed, and token utility and governance will be designed.
To note: Wormhole platform was once hacked, resulting in a loss of 320M USD.
Should You Buy or Hold W Token?
I think the W token is available at an attractive valuation, making it a good buy. One might consider exiting the W token around a 25 billion USD FDV ($2.5 per token).
According to me, a fair valuation of the W token in terms of price is $2 to $2.5. The possible ROI to fair valuation is 3X to 4X.
Also, staking Wormhole could get you a MONAD airdrop, which could be a good plus. Once the staking platform goes live, I am expecting the price of the W token to surge.
Also remember, such big investors do not invest for just a 2.5X return. They look for anywhere between 10X to 100X. To make an exit, they will create demand, which may take some time. It could be a good time to invest in the W token and DCA from here every 20% drop. At least, that is what I will do.
