Introduction

Why is the VPN topic so important? From statista, the market of VPN services is expected to explode in the next years. Here the data:

In my previous post about orchid-oxt after having described the advantages of orchid vpn on the competitors, among them the tor project,  I have mentioned the importance of a good and user friendly client application. I have decided to test the beta which in the iphone is still in development mode. I think that this is the best way to assess how the project is growing with what we have available now and considering the work I have already done in the other post. I will:

• Describe the procedure to install
• Vote the orchid app usability
• Give some feedback and ideas
• Reassess the pricing model presented in the former article

Installation

To test with the iphone you need to:

• Install testflight and agree to the conditions (done through the Application on the iphone).
• Once you are done: click this link from the  iphone in a browser https://testflight.apple.com/join/BlkfHkHY
• Orchid vpn will be loaded as application and appear on your iphone
• Now a wallet is needed loaded for some tests with 4 usd in OXT and 1 usd in ETH (it is estimated that 60 GBs of traffic and three ethereum transactions will be covered). Streaming anonymous and with a very large bandwidth from abroad television for some sport events could be a perfect usage for me.
• I have installed, to try something new, Trust Wallet which is recommended by the orchid website. It has worked very well and proved to be a quite well designed wallet.

At this point a phase a bit laborious starts. You have two apps running in parallel:

• Trust Wallet (loaded with the minimal amount required)
• Orchid (to be financed)

The pictures show the current status for Trust Wallet loaded with eth and oxt

In Trust Wallet:

• Copy your Ethereum address public address to your clipboard

Click on the browser button and insert the address account.orchid.com . This will load

Bookmark it.

In Orchid application

• Open the app. Tap “New Hop” and then “Orchid Hop”

• Paste your Ethereum address (figure above first field)
• Generate a new signer key, save your hop, and then copy it to your clipboard (figure above second field)

Go back to Trust wallet:

• You should still have in browser account.orchid.com loaded
• Click create account
• Paste your signer key

• Fund account. This will be the look of the app at the end

Finally back to orchid application:

On the Orchid app’s main screen, switch the toggle in the top right to “on” to enable Orchid on your device and activate your configured hops. You can monitor the traffic logs, add ops an play with the functionalities of the app.

Usability

Once the installation is finished the usability is trivial the app super fast and the traffic fully logged. I have chosen only one hop for now. 

At the moment, you don’t choose the country where to appear in the web: for me was Usa (Illinois): I could verify with the ip search.

The preparation of the application requires a bit too much time especially if the coins have to be bought in coinbase as recommended by orchid for privacy reason. You could finance the portfolio by credit card in an heartbeat loading 50USD of oxt and 50USD of eth (the minimum purchase looks too much for ETH but for using quickly the app this is the best way. Eth will last long with such a setup)

After this step is done it becomes much more easy to manage the funding: Trust Wallet keep history of the app and you can tap the funding app to add balance, withdraw, see the current status with eth address, funds and signer address (generated in orchid).

The menu display another action: move funds. See picture.

I have clarified  that a user who runs the client cannot stake the coins. I expected it from the documentation and the move funds functionality was a bit confusing in this context. 

My vote is 9/10. The setup could need support: a slow video or an article like mine enhanced from user feedbacks should do the job..

Investing in token

Considering the enormous pros I faced testing the application and the possibility of a competitive advantage in terms of privacy plus speed towards some players in the market I can review the price upwards compared with my first article. Orchid addresses many problems of the vpns and seems superior to a possible competitor like tor project. Solutions like protonVPN (provider also on protonMail) are competitive and expensive though not decentralized and, for sure different. 

The market is anyway huge if having just a 1% of it by 2022 would mean revenues around 400mn per year. We can then try to calculate with numbers like those what could be the capitalization of the float.

Imagine that clients pay 400mn usd per year: stakers will incur in management costs and ethereum gas cost has also to be deducted. Let’s approximate to 60 mn usd the value which could be divided per earnings. Staking 1200mn usd would mean a 5% per year. Here I differentiate from my last article estimation:

Let’s stay conservative and keep the 400mn usd payed per year by clients and 1200mn usd staked.

I think that a natural behavior of a OrchidVPN user will be to keep a certain amount of OXT, let’s say 6 months or even more to avoid to refinance too often. This means that the 400mn usd client side become 200mn usd in computation of the float in usd. We are not considering people buying the OXT just for speculating on growth (let’s say 200 mn usd scattered in exchange and accounts traded). (1200 staked + 200 accumulated in client accounts + 200 by speculation) mn usd = 1600mn usd 

At the moment the float could have a market cap of 250mn OXT with an ultraconservative approach. Let’s consider a reasonable float in 2022 of 400mn OXT (some dilution from the owner company) and the price would already be of 4USD with a clear expansion model in front of the company.

Obviously with margin higher on the money paid by clients and a bigger amount of market we could easily have to consider a factor 10 on my previous calculation.

Conclusion 

• We have showed how to test on an iphone orchid.
• We have described how it is necessary to invest time for the installation but that could be well supported with how to articles and a well thought video.
• We have reassessed the possible OXT price: 
  • in a scenario 1% market, 15% margin for node operators, holding of token for clients in reasonable amounts and little speculation less than 20% of staked amount, dilution to 400mn OXT (salaries, financing of new project, i.e. mail) gives a price of OXT = 4 USD.
  • in a scenario 5% market, 30% margin for node operators, holding of token for clients in reasonable amounts and little speculation less than 30% of staked amount, dilution to 400mn OXT (salaries, financing of new project, i.e. mail) gives a price of OXT = 35 - 45 USD

Disclosure: after this analysis I have opened a little position in OXT which I will reassess periodically calibrating the model presented.