Last month, Lumoz announced the completion of a new round of strategic financing, with well-known traditional mega funds such as IDG participating, and it has only been about a month since the completion of the Pre-A round of financing. Earlier, Lumoz revealed that it would conduct node sales in the near future, and the sales volume has now reached nearly half, with a good market response. In the past few months, there have also been many high-quality projects conducting node sales. So why are many projects with strong technical backgrounds interested in node sales recently?
Node sales are booming, and a fierce battle is about to begin
Node sales, a new token issuance model that benefits multiple parties, is favored by many projects and investors due to its flexibility, and has gradually become one of the popular financing methods in the market. Any decentralized network requires a large number of nodes to support it. Therefore, project teams can set a certain proportion of node token rewards (Node Rewards) in their Tokenmetrics for node sales, and investors can obtain node token rewards by purchasing nodes for mining.
So, how should we understand node sales? Let’s start with the familiar primary market and secondary market. The primary market is the primary channel for project financing, and ordinary investors have almost no opportunity to participate in the primary market financing of high-quality projects. The secondary market has no threshold restrictions, but the projects in the secondary market often have higher valuations, which greatly tests the investors’ judgment and research capabilities. Node sales can be simply understood as a 1.5-level market between the primary market and the secondary market. For project teams, the financing method of node sales is more flexible than the primary market, and for retail investors, they can participate in early-stage investments at lower valuations, in order to obtain higher investment returns.
The factors influencing node sales are similar to ordinary token sales. Therefore, when evaluating whether a project’s node sales are worth participating in, in addition to the fundamental research of the project itself, one should also consider the following: 1. The proportion of node token rewards; 2. The release/redeem rules of node tokens; 3. The release rules of other tokens, such as tokens used for ecosystem incentives and marketing, and most importantly, the release of team and investment institution shares.
Speaking with data: Some data references about Lumoz
Next, let’s compare several mainstream node sales projects currently on the market: Lumoz, Aethir, CARV, and Sophon, and mainly interpret why Lumoz stands out from the current node sales battle from the perspective of expected returns.
Project Overview
Lumoz: Focuses on the construction and technological innovation of the modular computing layer & ZK-RaaS platform. Lumoz aims to simplify the use of ZK-Rollup and enhance its universality, thereby promoting the large-scale deployment of application chains based on zkEVM. Developers can easily deploy their ZK-Rollup (zkEVM) on multiple chains. For miners, Lumoz is a multi-chain PoW protocol that supports mining on various public chains and generates zero-knowledge proofs for ZK-Rollups. The innovation of the modular computing layer can be used to efficiently absorb idle computing power in the market, thereby providing modular computing support for ZK-Rollups.
Aethir: Scalable decentralized cloud infrastructure (Decentralized Cloud Infra), building a GPU-based distributed computing infrastructure to break the barriers caused by hardware and empower AI and gaming.
Sophon: A modular blockchain focused on the entertainment track based on zkSync. As a zkSync superchain using ZK Stack, Sophon aims to customize for any high-throughput application.
CARV: The CARV protocol is a modular data layer that facilitates data exchange and value distribution between the gaming and AI fields. With the CARV protocol, everyone can now own, control, verify, and monetize their data, ensuring privacy, ownership, and control firmly in the hands of individuals.
Basic Data Comparison
From the node sales data panel above, it can be seen that compared to the other three mainstream projects, Lumoz and CARV are very generous in the allocation of node tokens, both allocating 25% of the shares for node sales, while Aethir and Sophon only have 15% and 20% of node token shares, respectively. The most obvious part that affects the stability of the token price during the token release process is the release of team shares and investment institution shares during the primary market financing.
From the perspective of token release rules, Lumoz’s node tokens are released linearly over 36 months, and the shares of investors in both rounds of financing have a lock-up period of 6 months and are released over 36 months; the team shares have a lock-up period of 12 months and are released over 48 months. CARV’s investor shares start to unlock after a lock-up period of 6 months, and the team shares start to unlock after a lock-up period of 9 months. Since the redemption period for node tokens is 5 months, the node tokens will start to circulate earlier than the investor shares.
As for Aethir, both the team shares and investor shares have a lock-up period of 12 months, but due to the synchronous release of 35% of the GPU tokens with the node tokens, the double amount of chips compared to the node tokens may bring unavoidable inflationary pressure. In comparison, Lumoz and CARV, which have more generous token allocation and more friendly release rules for node tokens, may face a smaller inflation rate in the token unlocking process.
Expected Return Rate and Payback Period Analysis
Lumoz’s Sales Plan
Node token reward distribution plan: You can obtain a total of 25% MOZ node token rewards by purchasing Lumoz zkVerifier nodes for mining.
Payment methods:
– ETH payment, supported by Arbitrum network
– BTC payment, supported by Merlin Chain
– BNB/BTCB payment, supported by BSC network
– USDT/USDC/ZKF (10% discount) payment, supported by Arbitrum, BSC, and ZKFair Network
Invitation mechanism for Lumoz node sales: Buyers of nodes can enter an invitation code when purchasing to get a discount. This discount will not take effect immediately but will be refunded to the node buyers in the future. In addition, the inviter can also receive a maximum commission of 10%.
Refund mechanism: After 6 months of Lumoz TGE, the refund window opens, and users can choose to return all produced tokens and NFTs and receive an unconditional refund of 80% of the payment amount.
Expected return rate and payback period analysis for MOZ node token holders
The above is the specific plan for Lumoz node sales, with a limit of 100,000 nodes and a total of 10 tiers. It can be seen that the price of zkVerifier nodes increases with each round, from $200 in the first round to $704 in the final round, an increase of about 2.5 times. If all 100,000 nodes are sold out, Lumoz will raise $40 million through node sales. As for the buyers of zkVerifier nodes, the expected total return they can obtain through mining includes: sharing 40 million Lumoz Points (before TGE), receiving 25% Lumoz tokens (after TGE), and potential airdrops of Lumoz’s new chains in the Layer.
As the most important part of the return composition, here we only take the MOZ node token rewards to estimate the expected returns from participating in Lumoz node sales. Currently, Lumoz has completed three rounds of financing, and in the third round of financing, Lumoz’s valuation was $300 million. Generally, the market value of a project at TGE can reach 10 times the valuation of the previous round, which means $3 billion for Lumoz, and the total value of 25% MOZ tokens is $750 million. However, considering the uncertainty of market sentiment and market fluctuations, as well as the impact of other uncontrollable factors, we conservatively estimate the market value at $1 billion, and the total value of 25% MOZ tokens is $250 million.
Further analyzing the cost, it can be seen that from tier 1 to tier 10, the node sales prices increase by 15% each round. If you participate in the purchase of tier 1, the cost per node is $200; tier 3 costs $265; tier 6 costs $402; and finally, tier 10 costs $704. Here, we only show the unlocked quantity of node tokens corresponding to the first 12 months, but in reality, the unlocking process will be completed over 36 months.
After the completion of node sales, the actual mining income depends on the number of nodes online simultaneously and their online duration. As shown in the above figure, when there are 10,000 nodes online simultaneously, each node can receive a reward of 6,944 tokens in the first month, while when there are 50,000 nodes online simultaneously, the mining reward in the first month decreases to 1,388 tokens. This means that the more nodes are online at the same time, the fewer tokens each node can receive as a reward.
Next, we can further estimate the ROI of node mining. The table shows the expected returns that can be obtained from participating in node mining in the first year, calculated based on a valuation of $1 billion. Assuming that lucky investor A successfully participates in the purchase of tier 1 and his cost is $200, the green squares in the graph represent the time it takes for him to break even. When there are 10,000 nodes online, A’s ROI reaches over 300% in just one month, and he can achieve a 10x return ($2,083) in the third month. Investor B, who participated in tier 6 of node sales and purchased zkVerifier nodes at a cost of $402, will also break even in the first month and achieve a return of over 150%. At the same time, within six months, B can also achieve a return of over 10x ($4,167) through node mining.
Compared to other projects, XAI, which has sparked the current node sales trend, has a payback period of about 4 months. CARV, which is most similar to Lumoz, although the value of the node tokens released in the first month is enough for tier 1 users to break even, because the veCARV tokens released need to be redeemed for CARV before they can be traded, if they want to redeem at a 1:1 ratio, they need to wait for a redemption period of 150 days, so the payback period also needs at least 4-5 months.
In terms of airdrop rewards, buyers of zkVerifier nodes also have the opportunity to receive airdrops from upcoming Lumoz-supported new chains, ecosystem partners (such as Merlin Chain, ZKFair), and invested projects. It is worth mentioning that due to the sell-off caused by token unlocking, the prices of MERL and ZKF tokens, which are expected to be airdropped, are almost at the bottom. With the weakening of selling pressure and the reversal of market sentiment, the expected airdrop rewards for these two high-quality projects with both technical and narrative background, MERL and ZKF, have added more anticipation to Lumoz’s node sales.
Have strength and background when venturing out
As a global distributed modular computing network, Lumoz is committed to providing advanced zero-knowledge proof (ZKP) services to support the development of Rollup networks and provide powerful computing services for cutting-edge technologies such as artificial intelligence (AI). In response to the high cost of zero-knowledge computation in the current field, the Lumoz network utilizes its years of deep expertise in ZKP to significantly improve computational efficiency through innovative optimizations of circuits and algorithms. This effectively solves the problems of high cost and low efficiency faced by Rollup projects, and reduces the threshold for ordinary users to participate in the zero-knowledge computation market. On the other hand, Lumoz also launched the modular computing layer, which can efficiently absorb excess computing power in the market and provide modular computing support for its ZK-Rollups.
At the same time, Lumoz’s zkVerifier nodes also bring unprecedented convenience to users. By simply running a lightweight node, users can easily perform ZK computation and receive corresponding rewards from the network. This innovative initiative will promote the widespread application of zero-knowledge computation technology and bring broader application prospects to the entire industry. Since 2022, Lumoz has supported more than 16 Rollup projects in the test network, achieved over 20,002,146 transactions, and the community has grown to 440,000 members. Starting from 2024, Lumoz will provide ZKP-related technical support for more than 20 new chains, including Merlin Chain (BTC L2), ZKFair (EVM L2), Orange Chain (BTC L2), and others.
The most popular narrative, unique core technology, and excellent R&D capabilities have also made Lumoz favored by the capital market. In April, Lumoz completed its A round of financing with a valuation of $120 million, led by Polychain. In addition to top crypto-native institutions such as OKX Venture, other investors include traditional USD funds that have been active in the crypto market, such as GGV and IDG Capital. Then, at the end of May, Lumoz announced the completion of a strategic round of financing with a valuation of $300 million. The specific amount was not disclosed, and the leading investors were IDG Blockchain, Gate Ventures, Blockchain Coinvestors, and Xia Yan Capital. The strong financing background undoubtedly adds competitiveness to Lumoz in the node sales battle.
Conclusion
Summer is coming, and we have survived the “long” two-month bear market. Currently, with the approval of ETH ETFs and Trump’s strong statements on crypto, the market’s expectations and consensus of the return of a bull market are expected to reach a climax again. Based on experience, it is generally expected that the real peak of this bull market has not yet come, or at least it will reach the high point seen in March again. In this slightly optimistic sentiment, Lumoz, which combines topics, strength, and background, how can it not be anticipated?
