Analysis of Wormhole (W) Token: Is it a Worthwhile Investment?

Wormhole functions as an open-source interoperability platform for blockchains. It improves connectivity between various blockchains by enabling secure cross-chain messages and transactions. The platform plays a crucial role in transferring over $40 billion worth of value, facilitating over 2 million daily cross-chain messages across more than 30 blockchain networks.
Wormhole is supported by major investors such as Jump Crypto, Coinbase Ventures, Multicoin Capital, among others. It raised $225 million in funding, establishing its valuation at $2.5 billion in the last funding round.
Recently, Wormhole launched its token – the W token – on almost all major cryptocurrency exchanges. On the first day, nearly 400,000 users received airdrops of W tokens. Originally launched as an SPL token on Solana, the next step is to transition to an ERC token and introduce multi-chain staking.
Explanation: What is Wormhole?

Wormhole is a protocol that facilitates the exchange of messages between blockchains, enabling developers to integrate and use multiple ecosystems for cross-chain applications. While it is not a blockchain or token bridge itself, it supports functionalities like token bridges through other built-on protocols.
Wormhole can be utilized for various applications including:
– Cross-Chain Exchanges that allow for deposits from any connected chain, boosting user liquidity.
– Cross-Chain Governance, enabling joint votes on proposals for NFT collections on different networks using a unified “voting” chain.
– Cross-Chain Gaming, issuing rewards and NFTs on other networks like Ethereum from games developed on networks such as Solana, leveraging Wormhole’s connectivity.

Wormhole Tokenomics
– Total Supply: 10 billion tokens
– Circulating Supply: 1.8 billion tokens (18%)
– Locked Tokens: 82% locked, gradually released over four years
– FDV (at $0.66): $6.6 billion USD
– Current Marketcap: $1.2 billion USD
– Valuation: $2.5 billion USD (last funding round)
The token reached $1.8 on the first day (18 billion USD valuation) and has since dropped by 63%. While many retail investors view Wormhole as a poor investment, the potential remains to be seen.
Wormhole – MONAD Connection – Rumors
– Founder’s Investment: The Wormhole founder made a strategic investment in MONAD, indicating broader support within the blockchain ecosystem.
– Potential Airdrop: Speculation suggests that staking Wormhole tokens could make participants eligible for a MONAD airdrop, adding value for token holders.

Wormhole staking is in development. Currently, there are no specific uses for the W token, but plans are underway for the formation of a DAO to establish token utility and governance structures.
It’s worth noting that the Wormhole platform was previously hacked, resulting in a loss of $320 million USD.
Should You Buy or Hold the W Token?
In my opinion, the W token is attractively priced, making it a good investment. Exiting around a 25 billion USD FDV ($2.5 per token) could be a consideration.
I believe a fair valuation for the W token is between $2 to $2.5 in terms of price, potentially yielding a return of 3X to 4X to fair valuation.
Additionally, staking Wormhole tokens could lead to a MONAD airdrop in the future, providing further value for token holders. Once the staking platform is active, I anticipate a surge in the price of the W token.
It’s important to remember that major investors seek substantial returns, typically between 10X to 100X. They may create demand for the token to make an exit, which could take some time. Investing in the W token and dollar-cost averaging with every 20% drop could be a prudent strategy moving forward, at least that’s my approach.

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