Update: The total BID supply of 2.6 Billion BID we mentioned in our article is not correct due to the staking rewards. We contacted Bidao to get a reasonable estimate and will update this article once we get an answer.
Bidao is a decentralised finance (DeFi) system which aims to become the DeFi backbone of the Binance Chain, similar to what MakerDAO became for Ethereum. It is a project still in the making, planning to provide a USD-pegged stable coin called BAI to the market.
Bidao´s token model
As Bidao explains on it’s website bidaochain.com the system consists of a 3-token-model.
1) BAI: BAI is the to-be-released stablecoin pegged to the value of 1 USD and thus will ultimately compete with others like Tether (USDT), USD Coin (USDC) and first and foremost with the decentralised stablecoin DAI on the Ethereum blockchain. Users will be able to mint BAI by locking their Binance Coins in a smart contract and hence gain liquidity. This can be seen as getting a loan which you can use to either convert BAI to your local currency in order to spend it in the real world or even to leverage your crypto investment. Moreover traders can exchange their traditional crypto coins such as Bitcoin or Ether for BAI in expect of a market downturn.
2) Binance Coin (BNB): Binance coin will be used as a collateral in the Bidao CDPs. A CDP is a collateral debt position which acts as a vault where users can lock their BNB in order to get a loan of BAI.
3) BID: BID is a so called governance token which enables it’s holders to maintain the Bidao ecosystem. For example they can vote on and even create Bidao proposals which can ultimately adjust and even radically change the behaviour of the Bidao ecosystem. As it is expected that BAI becomes an important part of the Binance Chain, people will try to have an influence in the direction the project is heading. And this is where demand for the BID token is going to come from and why it will have value.
What return is possible?
In this section we will examine the chances for early investors with the prerequisite Bidao achieves a similar success as Maker DAO. The Maker token on it’s peak was worth 1,700 USD. With a token supply of 1,000,000 Maker that yields a peak market capitalisation of 1,700,000,000 USD.
BID has a total supply of approximately 2,600,000,000 BID. Because you can get 1 BID for 0.01 USD the marketcap is 26,000,000 USD. That means if BID reaches the same marketcap as the peak Maker marketcap a tokensale investor would get a 65.3846153846 x return on his investment. Of course you have to consider that BID does not have a fixed supply. After the tokensale there will be a 3 % inflation rate per year. So you can’t definitely compare the two token models but this calculation clearly shows the potential.
You can participate in the tokensale on bidao’s website bidaochain.com. We are currently in phase 2 of 5. In this phase every investor gets a 30 % staking reward even during the three following tokensale phases. That means if you invest now you can earn a significant reward until the end of the token distribution.
Please note that this is not financial advice. Every potential investor should do his own research. This article is for information purpose only. I also want to inform you that I own a small amount of BID token myself.
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