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Fantom: The Financial Insider of Being a “Crypto Company”

22-11-28 18:41

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Original title: " AC tells the financial history of Fantom: from $2 million to $1.5 billion "

Original source: Andre Cronje

Original compilation: Odaily Planet Daily

On November 28th, Andre Cronje published a new article on his personal Medium "Fantom: Financial Insider as a "crypto company"", which details Fantom The financial status of the foundation in the past few years, from less than 2 million US dollars at the bottom to nearly 1.5 billion US dollars at the peak, AC personally described how the Fantom Foundation adjusted its strategy in the face of different situations, and finally got out of the "financial crisis" of.

At the end of the article, AC also summarizes some of his personal experience and lessons from the changes in the financial situation of the Fantom Foundation, which may be worth every Decentralized project reference.

AC tells the financial history of Fantom: from $2 million Go to $1.5 billion

The following is the full text of AC, compiled by Odaily Planet Daily.

Fantom Historical Financial Information

—On June 16, 2018, Fantom raised approximately $40 million in funding. Most of the funds are ETH, and the price during the fundraising period was around $450-$700.

— In December 2018, Fantom sold all these ETHs into US dollars at a price significantly lower than that at the time of fundraising, leaving less than US$5 million in the treasury account.

The main expenses during this period include exchange listing fees of more than 3 million US dollars, KOL promotion commissions and sponsorship fees of more than 500,000 US dollars. So far, Fantom has decided not to spend money on exchanges and KOLs anymore. We started to be very frugal, completely suspended the marketing budget, hired only the necessary staff, all the C-level employees took a pay cut, and some even worked for free... We reduced the annual expenditure budget to under $500,000, so that Can last about 4 years.

— On May 7, 2019, the non-FTM assets in Fantom's treasury account were less than US$2 million, and the value of the 100 million FTM was only about US$900,000.

We started selling FTMs on a regular basis to have more funds for unplanned expenses.

— On February 2, 2020, the non-FTM assets in the Fantom treasury account were approximately over US$3 million, and the 45 million FTM was worth approximately US$400,000.

After that, Fantom began to actively participate in DeFi, using profits to buy back FTM.

— February 28, 2020 Our goal is to grow $8 million in the treasury by the end of the year, which will help us increase our budget to $1.5 million a year, and we need to scale.

— In March 2020, when we were spending about $600,000 a year, we were earning about 20% a year on the $3 million we had in hand, which meant $600,000 a year. We were excited and started to seriously think about scaling up.

— In June 2020 , COMP liquidity mining was launched. Currently we can mine $20,320 per week through sUSD and $39,071 per week through COMP. The funds on the treasury account have grown from around $2 million to $6 million (including FTM).

— On July 12, 2020, we have repurchased 57933544 FTMs from the market. The funds in the account have reached 8 million US dollars, and the income mainly comes from the liquidity mining of COMP and SNX (Odaily Planet Daily: Mining to support the team, just ask if you are not convinced).

— On July 13, 2020, our FTM holdings reached 207,378,636 FTMs, which means we have repurchased over 150 million FTMs.

— On August 20, 2020, treasury funds reached $18 million (including FTM), including $11 million in stablecoins and $7 million in FTM. At this time, an RPC service provider asked us for $8 million to integrate, and we declined.

— On October 30, 2020, we already had USD 27,114,975 in our account, and if we count the locked tokens, it has reached USD 39,687,104, basically returning to our initial fundraising situation.

— On January 1, 2021, treasury funds reached $51,684,378 (including FTMs) and annual income reached $2,009,849.

— On February 2, 2021, treasury funds reached US$146,792,798, including about US$20 million in stablecoins, about US$50 million in FTM, and about US$50 million in CRV.

— On February 15, 2021, we surpassed $1 million in weekly revenue.

— On February 23, 2021, we announced the sale of 81.5 million FTMs to Alameda at an average price of $0.428831 for a total of $34949726.5.

— On February 24, 2021, we sold an additional 10384165 FTM to Blocktower for a total of $5 million.

— On May 3, 2021, our treasury, including FTM, had reached $147,847,1641 (you read that right, close to $1.5 billion), and $300 million in liquidity. We scaled up further and increased our budget.

— On September 30, 2021, excluding FTMs, we had $263 million on our books.

— On January 5 2022, Alameda requested further cooperation, which we declined.

— On January 14 2022 January 14 An exchange requested a listing fee of 3 US$300 million for listing, but we rejected it.

— In May 2022 nbsp; nbsp;nbsp;May 2022, the treasury lost about $50 million in BOO, CRV, YFI, CVX and ETH positions, but we still have $100 million in stablecoins.

— October 2022, an NFT exchange asked for a $100 million deployment fee, which we also rejected.

— In November 2022 We now have more than 450 million FTMs, 100 million stable coins, 100 million encrypted assets, 50 million non-encrypted assets. Our payroll is approximately $7M per year and the treasury has enough funds to last us 30 years without using FTM.

Treasury Income Composition

Verification Node Income—— Fantom itself runs 9 validator nodes and invested a total of 60,708,615 FTMs, which means we get 4,182,823 FTMs per year.

Delegate income——Fantom entrusts about 60 million FTMs to the verification nodes on the network, which can give We bring in about 4.1 million FTMs in revenue.

Network Revenue - The Fantom ecosystem earns 10% of all transaction fees At an average transaction fee of 30,000 FTM per day, we make $1 million per year, and the average fee per transaction is less than $0.005.

DeFi income——Fantom can earn about $5.98 million per year through DeFi operations in itself and other ecosystems (Odaily Planet Daily: It accounts for more than half of the total income, let’s see what a DeFi master is...).

Fantom currently generates over $10 million in annual revenue, not including any investment income.

We are cash flow positive. We're still continuing to scale.

Some Lessons Learned

Never try to "integrate ", "listing", "cooperation" and other digital aspects to fight for face with competitors. Unlike most competitors, the Fantom Foundation owns relatively few FTMs, some other Layer 1 may have 50% - 80% of the token supply, but Fantom's share at launch is less than 3% ;, and now our position ratio has exceeded 14% . We prefer to buy our tokens, we will not sell our tokens for so-called "partners".

"Blockchain companies" don't make money, it's not the Fantom Foundation's job to run validators, we just do it to support the network we believe in , and earn fees for doing so. However, this is not our core business, Fantom's core business has always been to build the most scalable and robust Layer 1 .

Network income is a point that distinguishes Fantom from other projects, but this is not designed for the foundation, this is the platform for all Dapps deployed on Fantom Income, any Dapp deployed on Fantom can get this part of the income. Although the Fantom Foundation has successfully practiced decentralized treasury management, this is not our core business.

In fact, "blockchain companies" generally can only make money by selling tokens, and such a model is limited in development.

We spent a lot of time comparing finite and infinite models. We ask ourselves "what impact will a certain collaboration have over a 10-year cycle", we ask ourselves "how can we sustain this cooperation for 10 years", and we ask ourselves "what if we Cooperation pays the bill, will they be deployed to other chains soon”, we will make a decision based on the answers to these questions.

Besides Ethereum, Fantom is the oldest non-forked Layer 1 with true TVL. We have been in operation for more than 4 years, and we plan to continue to operate for at least 30 years, and you can follow our technical progress and delivery progress at any time.

If your entire revenue model is selling tokens, then you are doing yourself, your blockchain, and your backers a disservice.

If DeFi didn't exist, we might not be able to survive today. I believe this is true for many companies.

crypto is dead, crypto will live forever.