In the current bear market, retail investors generally lack investment opportunities, but crude "meme coins" and BRC-20 (the token standard of the Binance chain) have become high-profile investment targets. They have attracted a large number of retail investors with low costs, low barriers and more fair participation methods, creating a new round of wealth effects. In addition, the decentralized financing model (IDO) has once again emerged, and its relatively fair and transparent opportunities and predictable investment returns have attracted the enthusiasm of many retail investors.

The recent IDO launch of the Cetus project demonstrates this trend. The Cetus IDO was launched on May 10, attracting 108 million SUI tokens, with an oversubscription rate of over 950%.

Cetus

IDOs usually open limited investment quotas to the public at relatively low prices. Since the tokens are still in the lock-up period at this stage, there is almost no selling pressure, which means that as long as investors successfully obtain the IDO quota of popular projects, they have the opportunity to obtain high returns. The prerequisite for participation is to hold eco-coins or platform coins and pledge and lock them on the platform.

Taking Cetus as an example, its IDO token sale price is 0.04 SUI, the current highest price is 0.14 USD, and the current price is 0.11 USD. Investors who successfully participate in the IDO are expected to receive more than 2 times the return, while selling at the current market price can get about 1.3 times the return on investment.

In the current market, liquidity is almost exhausted. If you can obtain a quota for an IDO project, it will be a sure win, provided that the project is of excellent quality and attracts much attention.

From these perspectives, SuiPad, the Tier 1 project of Sui in the ecological track, may be a target worth investing in. As the official IDO Launchpad platform of Sui ecology, SuiPad will play an important role in the development of Sui ecology.

Historical experience tells us that at the climax of mainstream public chains, participating in IDO projects on their Launchpad can obtain excess returns on investment, especially in a bull market. However, does the situation in a bear market apply to this model? Participating in Launchpad's IDO is not always 100% risk-free, so you need to pay attention to the risks. What key indicators should investors pay attention to when participating in IDOs initiated by Launchpad? From these perspectives, is SuiPad still an asset worth investing in?

Introduction to IDO

IDO (Initial Decentralized Offering)

Usually, early projects require start-up capital, and the Launchpad platform provides investment opportunities to early investors by launching the project's IDO. IDO usually sells tokens to community users at a relatively low price. Since tokens are usually subject to vesting periods at this stage, their market value is usually low. Therefore, for investors, as long as they can obtain the investment quota of IDO, they can usually get a considerable return on investment. As a matchmaking platform connecting early crypto projects and retail investors, the IDO platform provides a decentralized financing channel for more start-up projects, and also provides investors with more opportunities to participate in early projects.

This model is usually a win-win situation. Retail investors have the opportunity to obtain high returns, and as long as they can obtain the maximum investment amount of IDO, they can usually obtain considerable excess returns, at least in the early stages of the Token Generation Event (TGE). For project parties, IDO can attract early financing support, and at the same time attract investors by providing a limited number of high-return investment opportunities, thereby creating market heat.

However, successful investment strategies in a bull market may not work in a bear market, and participating in IDOs does not always yield huge returns. Therefore, in a bear market, it is necessary to evaluate IDO investment opportunities more carefully.

IDO Investment Opportunities

When evaluating the return on investment of Launchpad, you can usually look at two key indicators, namely "historical highest average return rate" and "current average return on investment".

According to CryptoRank data, in the past year, the average historical highest (ATH) return on investment of each IDO platform has achieved remarkable results, up to 12 times.

ATH ROI refers to the maximum return on investment, which is calculated based on the peak price of the token. According to the data, the average maximum return on investment of the BSCPad platform is as high as 12 times, which means that investors in the first project tokens participating in the platform may get a return of $1,200 if they invest $100.

This suggests that investors who are able to successfully secure a small portion of an IDO’s investment and sell it within a short period of time after the IDO occurs (although not always at the peak price) can often receive a fairly substantial return.

In addition, IDO also plays a role in price discovery, by offering a small number of investors a high return on investment opportunity at a low price, attracting a lot of attention to the project. In fact, this is an attempt to create strong market demand. If it works well, the market demand will greatly exceed the supply, which will eventually be reflected in the price, that is, the token price will peak some time after the IDO.

According to the data, most average all-time high (ATH) returns on investment (ROI) occurred within a short period of time after the IDO. Take the Bloktopia project launched on the Seedify.fund platform as an example. Its public sale price was $0.00025 and the highest ROI return was 698 times. According to Coingecko's historical price data, since the token BLOK was launched through IDO on October 5, 2021, the token price has been rising rapidly until it reached a price peak on November 1, 2021. This means that the token's price peak occurred within a month after the IDO.

Another project called Humans.ai launched the IDO of its token HEART on the Polkastarter platform on December 9, 2021, with an offering price of $0.015. The price of the HEART token began to rise after the IDO and reached an all-time high of $0.263 on December 27. According to data, the historical highest return on investment of the HEART token is 18 times, and the current return on investment is 1.1 times. The price peak of this token also occurred within a month after the IDO.

According to historical data, the prices of almost all tokens launched by IDOs follow a trend, that is, they reach their historical peaks some time after the IDO. Given this price trend, we believe that participating in IDOs is very suitable for short-term investment, that is, selling them within a short period of time after the IDO to obtain a stable return on investment.

However, the average all-time high (ATH) return on investment (ROI) is not the only financial indicator to measure investment effectiveness. Although it seems that the average all-time high (ATH) ROI of almost all IDO platforms is very high, it does not mean that investors can always make a profit. The figure below shows the current ROI performance of various Launchpads in the past year, and the current ROI of most (if not all) platforms is negative.

Looking at the top 10 Launchpads by ATH ROI, 8 of them have an average current ROI below -31%. This means that if you participated in all IDO transactions on these platforms and held them until today, the loss could be more than 31%.

This is usually the case because the return on investment is affected by two main factors: one is the potential and performance of the project itself, and the other is the drop in token prices during a bear market.

Therefore, if you intend to hold the tokens of a project for a long time, you need to consider not only the fundamentals of the project and the token economic model (to determine whether it is suitable for value investment), but also macro factors. Even high-quality projects may be affected by market fluctuations and cause prices to plummet, so investors need to carefully consider the risks to avoid losses.

Is SuiPad a good investment?

As the first IDO Launchpad project officially recognized by Sui public chain, SuiPad plays the role of an intermediary between new projects and early investors in the ecosystem. Its goal is to select the best new projects in Sui blockchain through a unique screening process and industry access standards, while providing financing support for early projects.

In the current crypto bear market, even high-quality projects are bound to suffer losses. Therefore, SuiPad has made improvements in product functionality, providing investors with an optional insurance mechanism to reduce the investment risk of IDO participants. On the other hand, as a gateway to high-quality projects in the Sui ecosystem, SuiPad's native token will gain more utility as the number of IDO launches on the platform increases in the future. This will encourage more people to hold and lock SUIP tokens and continuously capture value in the process.

Bear-friendly insurance mechanisms

Although the return performance of participating in the IDO on Launchpad looks quite good, it is not without risk. Usually, Launchpad activities of various exchanges are accompanied by a wave of price increases when new coins are launched, but based on past experience, only very few cases will lead to price drops. To make a profit, it is necessary to ensure that the price of the new coin when it is listed is higher than the subscription price. Therefore, once the listing price is lower than the subscription price, it will result in losses, that is, breaking the issue price.

When participating in the IDO launched by SuiPad, users can choose to pay an additional 15% of the investment funds (note that it is the winning amount) to purchase insurance. This fee will then be deposited into the SuiPad Shield pool to cover potential losses that users may suffer in the next 7 days. On the 7th day after the launch of the IDO, if the average maximum price is lower than the IDO price, the SuiPad Shield pool will make up the difference for users, thereby protecting the user's principal.

SUIP’s economic model and upside potential

According to the official token economic model, the total supply of SuiPad platform token SUIP is 100 million, the initial circulation supply is 20 million, including 20 million for liquidity provision, the initial market value is $1.03 million, of which $500,000 is used for liquidity supply. The private placement price is $0.035 and the public offering price is $0.05.

According to SUIP's current market performance, the highest return that investors participating in IDO can obtain is 9.98 times, and the current return is 4.41 times.

Based on the current market value, does SUIP still have room for growth? Below we estimate the growth potential of SUIP tokens by comparing the current market value and maximum market value of several IDO platforms that also rely on ecosystems.

Data shows that the current market value of Polkastarter (token POLS) is 35.44 million US dollars, and the highest market value reached 360 million US dollars; the current market value of Avalaunch (token XAVA) is 10 million US dollars, and the highest market value reached 360 million US dollars; the current market value of Seedify.fund (token SFUND) is 49.8 million US dollars, and the highest market value reached 330 million US dollars; and the highest market value of DAO Maker (token DAO) reached 420 million US dollars, and the current market value is 240 million US dollars.

It is worth noting that, unlike other IDO platforms, DAO Maker adopts a membership mechanism, which does not require staking tokens and is based on a points system. Judging from the price history of the platform's token DAO, the price of the token fluctuates greatly.

Based on the current supply of 20,696,000 SUIP tokens and the market price of 0.2197, the current market value of SUIP tokens is approximately $4.35 million. Compared with the current market value of other similar IDO platforms, Polkastarter's current market value is $35.44 million, Avalaunch's current market value is $10 million, Seedify.fund's current market value is $49.8 million, and DAO Maker's current market value is $240 million. Considering that SuiPad is the leading project of the SUI ecosystem, the price of SUIP tokens may still have room to rise.

However, it should be noted that although SuiPad is the only IDO Launchpad platform officially designated by SUI, it is not the only IDO Launchpad in the SUI ecosystem. Since the creation of the IDO Launchpad platform does not require special permission, other suitable Launchpads may also enter the market and compete for the position of SuiPad. This competition may bring uncertainty to SuiPad's ecological leadership.

Nevertheless, considering that the SUI ecosystem is still in its early stages, SuiPad is still considered an undervalued potential stock with a low market value. Therefore, whether as a value investment or a short-term operation in a bear market, SuiPad, as the first IDO, ISO and INO Launchpad project on the SUI public chain, is a good investment target.

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