LeoBridge Going To Send LEO To Great Heights

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Sometimes we do not see what is sitting before us. It is tough, in the early stages, to connect the dots. However, we saw the introduction of an application that is going to have an enormous impact upon the holdings of every Leo. This will do more for the token value of LEO than most are imagining at the moment.

In other words, hold onto those LEOs because they are going for quite a ride.

Why do I say this and how much of an impact will LeoBridge have?

Most are focusing upon the .25% fee and how that goes to burn LEO and CUB. That is helpful but not of major impact, at least not in comparison.

Instead, there is another aspect to all of this that we much understand.

To get to the bottom of the numbers, we will focus upon the liquidity pool on Ethereum with wLEO in it. Since that is where a lot of the action is to come from, it will have the most impact.

One thing we must keep in mind is that everything as it pertains to this conversation is in USD. That is what all transactions are priced in. This makes the situation with LEO completely insane as you will see. In short, we are going to need a lot of LEO.

wleolp.png

This is the wLEO liquidity pool. We can see there is a total of $1.4 million in there right now, broken up into wLEO and ETH. For the moment, that is an overwhelming about of wLEO and not too much ETH. This makes sense since most were probably using the wLEO pool to dump that and get ETH.

LeoBridge is going to reverse this trend. Here we are going to see the demand for wLEO increase. Instead of dumping wLEO for ETH, people are going to be doing the exact opposite. Why? Because wLEO is needed to be unwrapped into LEO when using LeoBridge.

Of course, since it is automated, the individual is not doing this but, rather, the application. Nevertheless, we effectively see buy demand for wLEO.

wleo.png

Here we see the current pricing of wLEO as posted by Coingecko.

LeoBridge presently restricts transactions to $5,000. This was an increase for the $3,000 of just a few days ago. As the application passes the metrics during its live-run testing phase, that level will keep increasing.

Why is this important?

If we look at the amount of wLEO in the liquidity pool and multiply it by the price we see a total of $723,463.

This is more than half of the LP meaning Coingecko's price feed might be delayed.

Here is where we see things getting very interesting. Leaving the limit on LeoBridge aside for a moment, what would happen if someone wanted to move $750K from Ethereum over to BSC? According to these numbers the transaction would not go through?

However, nothing is static. Since this is a free floating market, if someone came to the table with $750K worth of ETH and went into the liquidity pool, what do you think would happen? The price of wLEO would naturally go up. With that much buy pressure, we would see the price adjusting.

This example shows how LeoBridge can really start to boost the price of LEO. While we will not see $750K moving in one transaction, at least not for a while, what would occur if there were 9 or 10 people moving 50K each? Keep in mind that $50K is not a big transaction on Ethereum. Since the fees are apt to hit 3 digits at times, those who play in that realm are doing so with big sums of money.

Of course, we could go one step further and say what would happen if there were 30 people moving $15K?

Whatever way we break this down, the result becomes obvious: there is a lot of buy pressure on wLEO.

Certainly, a case could be made that this is a non-issue since the LEO price would be equally affected on the other end as bLEO is converted into BNB. If markets were efficient, that might be a valid point. Yet, we know markets are not efficient. Hence, we see situations where the downward pressure does not offset the upwards.

Since all of this is tallied up in dollars, that is what matters. As the system is utilized, there are more dollars flowing through the system. Of course, right now, in the wLEO pool, there are not a lot of "dollars" there to handle the volume that could take place.

In the past, we saw the price of wLEO be different from that of LEO on Hive-Engine. You could make the case that much of this was driven by the price of ETH, pulling wLEO higher along with it.

Here we are looking at a different situation. The buy pressure on wLEO is going to impact LEO and, ironically, bLEO. As we know, activity gets people interested in tokens.

Another potential piece of the self-correcting mechanism is the going from BSC to ETH. This is not something to give much weight to at the moment because it seems that few will be looking to go in that direction. The fees on Ethereum are what is driving all of this and, until they are resolved, we will see migration more towards BSC.

So what happens when there is millions of dollars a day moving through LeoBridge from Ethereum on its way to BSC? What do you think buy pressure like that does to the value of the token?

It is obvious that the situation will not work with wLEO priced at 50 cents. To do millions of dollars in transactions would require 4 million wLEO. That isn't going to happen since there are still less than 7 million LEO in existence in all its forms (LEO, wLEO, and bLEO). Hence, the only way to handle the volume is for the price of wLEO to increase.

As transactions increase, so do the totals from the fees. This means the LPs get a greater return making it more attractive to investors. It all keeps compiling.

If you want a fun thought experiment, just try to picture what it would be like with $10 million per day flowing through LeoBridge and what impact that would have on the price of wLEO.

And $10 million on Ethereum is nothing more than a rounding error.


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17 comments
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I'm pretty much gearing up stock phase right now in preparation of the marketing they will be doing once everything gets ironed out. Time to play the long game. With DeFi in general will see massive growth over the next 6 months.


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There is likely to be a major push higher in the entire world of DeFi. We are going to see a lot of changes in that time. I am very optimistic that what Leofinance is doing is going to push both the LEO and CUB tokens much higher. The development is addressing real needs. It will be fun to watch.

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Yeah, listening to Khal and Neal's AMA you could tell that Khal is extremely excited about what the bridge is going to do. He also talked about adding more to Matic (POLY) and ThorChain (RUNE) to start with, with the ultimate goal to be able to bridge almost any chain. Could be an unbelievably valuable tool down the road.

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That only makes sense to keep expanding the capabilities of what is can do. We are going to see a very powerful application when all is said and done. That could end up with millions of dollars going through it. All good stuff.

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Great blog and you're bang on the money but there is one problem. What will incentives people to move from Eth to BSC? People aren't going to just use a system for the sake of using it.

This is why Kingdoms is such an important aspect of the project. Until all the live testing and Kingdoms is completed it's buy time and hold because when those flood gates open daddy's off to the coffee shop to buy an espresso shot and plan my retirement.

Just knowing how much to sell and stake is the issue. Who knows how long it will last and I don't particularly have the massive amounts to be instant millionair.

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What will incentives people to move from Eth to BSC?

Many are looking to get off Ethereum because of the fees. Since that does not look like it is going to diminish anytime soon, there will be a lot of accounts moving from ETH to BSC.

Plus, the US is banned from getting on BSC. We cannot buy BNB through Coinbase. Thus we are stuck having to work around that. This is one alternative especially if there is the Thorchain connection which will allow for the joining via litecoin.

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That's a good point, I didn't think about the blocked from BSC issue. This next phase will be a battle between the US and China in who dominates the sector. Space races are great for early adopters. Torching will be a great growth. Perhaps BSC will see a decline but .

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I think BSC will continue to grow simply because we need all the bandwidth. There is so much going on that we are going to need all this infrastructure. It is why I am excited about the idea of HSC. When that comes out, we will see Hive in the game. Perhaps what the SpkNetwork is developing will also work in that realm too.

A lot of good things happening that we can count on. Development is taking place.

As for the US and China, two idiots circle jerking each other in my opinion. Humanity just needs to out tech them both.

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Screenshot_20210517001614_Samsung Internet.jpg

Sorry I lost my comment box :(

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A problem with Leofinance on mobile or user error?

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Error on LeoFinance Mobile version m, I tend to try and push through but bigger comments I lose where I am upto. Starts off ok then flickers half way and goes outside of screen. Mainly just in comments not in posts.

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Its the reason why I wanted to increase my stake in the bLEO/BNB pool. However the issues with sending LEO over to BSC is making me reconsider how to allocate funds this time around. With increased usage of the bridge, both LEO and CUB will go up quite a bit.

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That is my thought. The market always seems to like those tokens with a lot of volume. With this bridge, there is going to be double the volume since there is activity on both the ETH and BSC side.

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You kind of lost me with numbers and technical data but one thing is clear. LEO will recover and probably even moon. I was discussing with a friend yesterday that at some point the price of LEO was fluctuating same way ETH was, but after CUB Finance got launched that was no longer the case. The situation has probably changed for the better.

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I do not see how the price of LEO is not much higher a year or two from now. There is so much going on, feeding the system at every level. This alone will help to push things higher as more eyes get on the project. It feels slow right now but there are a lot of major things being addressed. Keep amassing the tokens and you will be very happy in the next couple years in my opinion. It is my plan anyway.

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I can't wait to see more price action on Leo, it has been a while since the excitement at the beginning of the year. Although 50 cents works for me at the moment because it's easier to stack it :P

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Is there a big demand for the service though. That will be the big question.
Who will be using it and how much will flow through the bridge. We have seen so many great projects built on hive over the past three years that faded away as they were not marketed and used.

I really hope so and do think that the team will put the marketing to go with it as they have put a lot of money into building the service.

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