Direct from the desk of Dane Williams.
If you're looking to accumulate cheap LBI tokens, now may be your best chance.
Have you been watching the Leo Backed Investments (LBI) project and feel you have maybe missed the boat?
Spoiler alert, you haven't.
What is Leo Backed Investments (LBI)?
LBI is an investment fund denominated in LEO with the goal of offering exposure to all of the various earning opportunities across the Leoverse.
At launch, LBI sold shares in the fund, denominated in LEO, at a 1:1 price ratio.
But as the fund grows and reinvests a portion of its substantial earnings, the true price of the LBI token is no longer 1:1 with LEO.
Just going by the last LBI earnings report, you can see that the true value of the LBI token is actually 1.62 LEO:
With this pricing, different participants in the market can now start to find various short and long term opportunities that work for them.
Your opportunity to buy cheap LBI
You see, the Leo DEX actually prices the extremely illiquid LBI tokens in HIVE rather than LEO.
Thus ensuring that there is always going to be a disconnect or lag from the true value of a token that is meant to be denominated in LEO.
This offers opportunity for numerous participants:
- Long term investors in the LBI fund: Means they can often pick up LBI at a 1:1 price with LEO.
- Short term traders: Means they can provide liquidity to an illiquid market that allows holders to dump their tokens for an instant payout and then sell them directly back to long term investors on the cheap.
With a scenario that benefits each, currently playing out right in front of our eyes.
Just take a look at the LBI order book:
What we have here is a savvy trader who has identified the short term opportunity to accumulate cheap LBI from people looking to dump at any price and then sell to long term investors who are buying for the fund itself.
So now take a look at the LEO order book:
Yep, even though the true value of the LBI token is priced at 1.62 LEO, you can see LEO is actually priced at less than 1:1 to LBI on the market itself.
This is not as crazy as it seems
While this might seem crazy on the surface, it's actually a perfect example of a healthy market at work.
After all, each participant has different goals or viewpoints and as a result, we are more healthy overall.
Whoever is dumping their LBI for cheap is happy because they instantly receive HIVE.
The short term trader is happy because they can then instantly sell that cheap LBI for a profit.
And finally the long term investor is happy because they are accumulating LBI tokens at a 50% discount to their true value.
A win/win/win for everyone involved and a reminder that a liquid market is always better than its illiquid counterpart.
Are you buying any of that cheap LBI?
Best of probabilities to you.
Update 1:
Well that didn't last long.
Someone came in and scooped up over 2K in the one go:
But lucky for you, this seller is motivated and has put up another 4.5K LBI:
It's a little higher, but still cheaper than LEO itself.
Wild.
Update 2:
Well, that didn't last long.
Again, all scooped up in the one hit:
Everybody wins :)
Posted Using LeoFinance Beta
