The canya.io ($CAN) ICO has just completed, and I take a look at how to value it.
I’ve been watching the CanYa ICO with some interest; partly as it’s a somewhat rare Australian ICO but mostly because it has an established business and a solid looking team behind it. Not long established, I grant you, but there seems to be a genuine intent to build a functioning personal services ecosystem based around secure non-fiat payments. This intent is reinforced by the majority stake acquisition in BountySource, adding 46,000 users to CanYa.
As a business model, it’s in good company with AirTasker, TaskRabbit, Fiverr, Upwork and the various Freelancer style gig economy sites, with a properly useful blockchain model.
With a presale in October 2017 selling out, expectations were high for the full ICO in November to do similarly. That turned out not to be the case, with the ICO ending on just over 11M (roughly 14-15M with bonuses) of the 60M $CAN tokens available for the ICO sold for 11,013 $ETH. Certainly not shabby, but no doubt short of the principals’ hopes.
CanYa was nonetheless positive in their post-ICO blog stating that the $CAN launch was the “2nd most successful ICO that Australia has ever hosted” – presumably after $POWR which raised USD $13.2M to $CAN’s USD $8.3M.
Putting aside the longer term question of whether that will be sufficient funding to take the CanYa business model where it needs to go, does it represent good value for those who invested in the ICO? The answer, of course, is “it depends”.
With a total supply of 100M $CAN, and based on the USD $8.3M value of the 11,013 $ETH poured into the ICO, the token sits currently at a value of USD $0.083. At the same $ETH price, each token cost between USD $0.54 and $0.76 to purchase depending on the bonus level. Not, on the surface, a tremendous investment; however there are several other factors at play.
Firstly due to KYC regulations, non-Accredited US investors were prohibited from investing. This likely held back the capital injection they may otherwise have been able to achieve. Additionally, CanYa were quite transparent with their distribution strategy and the ICO could only ever have achieved a 0.6 valuation on capital, as only 60% of the tokens were offered for sale.
$ETH also surged over 50% during the ICO which no doubt made investors think twice about swapping them for a speculative token at a fixed exchange rate and with slow ICO sales. This may have resulted in sales under-representing true interest.
Finally, CanYa intend to “burn” 30% of the unsold tokens to reduce the supply. Should that go ahead as planned, the book value of each $CAN token would bump to USD $0.112.
Of course the book value means little and ultimately the tokens will be worth what people are willing to trade them for. No exchanges have yet been announced, but if CanYa can secure seats on high profile exchanges, investors may well see the 4x – 7x returns they need to break even at launch. Returns for HODLers will additionally be subject to the success of the business model, which at this stage looks promising.
CanYa’s ability to ensure a well publicised launch on major exchanges will be a key factor in its public valuation. A breakeven valuation is not impossible, and should particularly US investors see value in blockchaining the gig economy, this may well be a second success story for investors in Australian ICOs.
James
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The author is not a financial advisor and nothing in this post constitutes or is intended as advice. You are responsible for your own investment decisions. Header image courtesy of rawpixel.com. The author holds the following cryptos mentioned in this article: $CAN $ETH $POWR