If you have been watching cryptocurrency tokens recently you may have noticed that exchange utility tokens seem to be a hot trend in 2019 and BitFinex is being certain not to miss out! Unus Sed Leo is the utility token designed to be the heart of the iFinex ecosystem (the company that owns the top exchange, BitFinex). Launched only in May 2019, Unus Sed Leo is a cryptocurrency that is very similar to that of BNB, the utility token for the Binance exchange. (Check my 2020 Binance Prediction here).
Finex continues to be a profitable firm and if they stay on this track, the entire ecosystem behind Unus Sed Leo will also grow which will lead to an increase in the price of their LEO token.
iFinex has a large range of platforms scheduled for release over the following months, all of which will use the Unus Sed Leo token - increasing the utility of LEO. Furthermore, the company also has a “buyback and burn” program which will see sustained support and liquidity within the LEO market. For these combined reasons, and more discussed below, I believe that Unus Sed Leo has the potential to increase by 173% from the current price of $0.94 to reach my 2020 target of $2.56.
In this article, I’ll firstly cover a range of topics that I believe will influence LEO in reaching my $2.56 target during 2020 and then analyze LEO on the long term daily charts to highlight some areas of resistance on the way toward the target.
Utility Tokens Rule Them All
It is no wonder that exchange utility tokens have been a hot trend during 2019, especially considering the fact that they have utility during both bullish and bearish trending markets. Whether the market is surging or dropping, traders will always need a place to trade their cryptocurrencies leaving room for a utility token in which growth is resistant to any market conditions. This concept has been explained well in THIS post.
Unus Sed Leo is their company motto taken from a Latin citation from Aesop’s fable “The Sow and The Lioness”. The exchange utility token is created by iFinex, a company incorporated in the British Virgin Islands that is the driving force behind Bitfinex, DeversiFi, EosFinex, and the very well known stablecoin, Tether USDt.
Their official whitepaper states that they Unus Sed Leo is “Created with the cryptocurrency at heart and in mind”. This is because it presents a sizeable opportunity for existing iFinex traders to receive discounts on their trading actions upon the exchange. If you make multiple trades a day these discounts add up very quickly, creating an attractive opportunity for traders to squeeze more out of their investments.
To find out more about these hacks and the LEO token itself, check out this great in-depth article to LEO.
Why Are People Skeptical About Leo?
Not too many people actually trust Leo and when you look into the reasons why - you can’t really blame them.
You see, it was launched in May 2019 after a private sale raising 1 billion US Dollars from a special purpose subsidiary of iFinex that grants them the capability to sell up to 1 billion USDt .
The deal involved direct exchange of 1 USDt (Tether-USD) for 1 LEO giving way to the creation of 1 billion LEO tokens.
However, it turned out that iFinex was just launching LEO to help to cover their losses from recent hacks and scams they have suffered.
What Happened With These Hacks?
The first BitFinex Hack was on August 2nd, 2016 when BitFinex lost a total of 119,757 BTC. After the hack, they had responded very well by creating a BFX token to compensate customers on a 1-to-1 ratio based on USD lost. BitFinex managed to honor their commitment to repay the losses and had completed all repayments within 8 months of the security breach. All BFX token holders had tokens redeemed 100% or had exchanged tokens for shares of capital stock in the iFinex company.
In my own opinion, BitFinex responded very well to this attack. Although they lost some credibility after leaving themselves open to the hack they did manage to stand by their customers and pay everybody back in a respectable amount of time.
The second blunder was more of a scam than a hack. It involved a payment processor known as Crypto Capital. In summer 2018, Crypto Capital had funds trusted in their custody from iFinex seized by government officials. Over $880 million had been seized after Van Lee, a principal of Crtypyto Capitol, was detained in Greece. This man has now been extradited to Poland where he will face charges. Bitfinex has painted themselves as the victim in this fraud and has offered a statement to clarify the scenario.
The interesting thing about all of this is that they have pledged to use all of the recovered funds (when they get them) to buyback and burn every LEO token created - regardless of what price they are. This would mean that when the funds are recovered, there will be a great surge in price as the team at iFinex buy LEO from the live market to burn from circulation.
Wait, Their Burning Does Not Stop There!
Bitfinex will also burn further LEO tokens used to pay from the fees for using the BitFinex platform. They have promised to repurchase LEO at market rates that will equate to 27% of the firm’s consolidated gross revenues. This will continue until 100% of Unus Sed LEO tokens are redeemed creating some great buy support for the market!
This combined with the burning from the recently scammed funds should help increase Unus Sed Leo quite significantly.
iFinex is really trying to remove the tarnish from their name as they attempt to make their burn mechanism as transparent as possible after the release of the Unus Sed Leo Transparency Intuitive. They have also released a website that provides real-time insights into all of the statistics in the LEO burn program.
Continued Progression For Utility
iFinex has a lot of platforms in the works that will help to expand the entire LEO network utility. Furthermore, iFinex is already thinking ahead in terms of interoperability as the team decided to launch their token on both the ETH and EOS blockchains!
The benefit to users is that LEO provides traders with a discount on various kinds of fees when using iFinex services. For example, when using LEO tokens, all trading fees are reduced by up to 15% for any crypto to crypto trading. This can extend to a further 10% reduction if the trader holds 5000 or more USDt (Tether) worth of LEO tokens - creating an incentive for traders and whales to store and hold large amounts of LEO if they trade on BitFinex which will constrict the supply on the market. The fees can be reduced even further if the trader owns 1 million or more worth of LEO tokens. LEO token holders will also receive up to 25% fee discount on deposits and withdrawals.
Other iFinex products where LEO could potentially be used include the Bitfinex Derivatives Platform - a platform (released September 2019) to trade through a derivatives wallet which will offer over 100x margin, and an IEO Platform - where pre-vetted token sales can be directly conducted from the user’s wallet on Bitfinex. Projects that are funded on the platform will automatically be listed to the BitFinex exchange. K.im, a project that is a content monetization system, is slated to be the first offering available,
Further iFinex platforms include Dazaar - a next-generation marketplace that will allow users to share large data sets on decentralized encrypted networks, regardless of borders, and BetFinex - a platform that will use Bitfinex technology to build the most secure and user-friendly betting exchange. iFinex intends to combine a start of the art betting API with high-performance physical hardware to create an entirely new standard in the betting exchange industry.
Development Metrics Proves Steady Progress
The development team consists of a small 25 developer army. This is very small but data from Santiment shows that development activity remains steady for both activity on the exchange side and on the Ethereum ERC-20 side.
BitFinex Introduce Loyalty Programme To Incentivise Growth
Nothing works better for growth than affiliate marketing and BitFinex have taken advantage of this after announcing a new Loyalty Rewards program.
Their marketing claims for the potential for users of the program to earn unlimited commissions through their tiered structure. The Bitfinex Affiliate Programme presents a tiered commission structure that will allow users to refer friends and family and receive a commission for “3 degrees of connection”.
Furthermore, if the referrals meet certain criteria users will receive commission multipliers - such as completing verification and holding a certain amount of Unus Sed LEO.
Source: Bitfinex.com
Unus Sed Leo (LEO) Price Analysis
LONG TERM - DAILY CHART
What Has Been Going On?
Taking a look at the LEO chart above, we can see that post-launch, LEO had managed to surge close to the $2.00 level before rolling over and falling. Since reversing, Leo has dropped by a total of -53% to reach where it currently trades at the $0.94 level.
Are We Bullish Or Bearish (as of October 2019)?
As of October 2019, we are most certainly bearish. If Unus Sed Leo was to drop beneath the current level of support, this may affect my 2020 prediction if it collapses much further. However, there is support toward the downside which is expected at $0.92, $0.90, $0.8758, $0.86, and $0.84.
For this market to be considered as bullish we would need to see price action rise and break above the October highs at around $1.05.
Where Is The Resistance On The Way Up TO $2.56?
If the bulls can hold the support around $0.9377 and rebound higher, we can expect immediate resistance toward the upside to be located at $1.00 and $1.05. Above this, resistance can be expected at $1.18, $1.33, $1.45 (.236, .382, .5 bearish Fibonacci Retracement levels), and $1.50.
If the buyers continue to rise above $1.50, higher resistance lies at $1.58 (bearish .618 Fib Retracement, $1.70, $1.85, $1.81, $1.86, and $2.00. The resistance at $2.00 will require significant momentum for the market to be able to penetrate above.
Beyond $2.00 we can expect resistance at $2.23 and $2.36 (1.272 and 1.414 Fibonacci Extension levels). If the bullish pressure can drive above $2.50, LEO will be free to make an attempt at my 2020 target of $2.56 which is provided by a 1.618 Fibonacci Extension level.
Conclusion
Exchange utility tokens have been a hot trend throughout 2019 and we can expect this to continue during 2020. This is because, regardless of the market trading conditions, traders will always need somewhere to trade their cryptocurrencies. Unus Sed Leo is shrouded in negative press but the team behind the exchange continues to work hard to remove the stain from their name.
Unus Sed Leo is certainly a great opportunity to receive discounts for traders on BitFinex. There is also a great promise from the fact that iFinex has promised to commit to a strong buyback and burn program that will help to bolster the support of the market. With these factors combined, LEO most certainly will be able to reach my 2020 target of $2.56 at some point during the year!
