Merlin Chain is open for airdrops. Will the returns from single Bitcoin betting outperform the market?

Original author: Frank, PANews

On April 17, Merlin Chain announced that it has opened the airdrop query page corresponding to Merlin's Seal points. It is reported that 20% of MERL will be distributed to users who pledge Merlin's Seal. According to the total amount of MERL of 2.1 billion, the number of tokens in this airdrop is about 420 million. Although the MERL token has not yet been officially issued, many over-the-counter MERL platforms have launched the trading pair. On April 18, the price of MERL was about 1.74. Calculated at this price, the scale of this round of airdrop is about 730 million US dollars.

Overall, the return on airdrops through staking on Merlin is not optimistic. PANews has counted the results of several major pledged assets. If you initially pledged assets worth 1 BTC, only BTC, ETH, USDT, and ORDI had a positive comprehensive return rate in the end, while the results of the other assets were negative. Among them, except for BTC, the comprehensive return rate reached 82.25%, which outperformed the highest spot return during this period. Other assets are not as good as holding spot and selling at high points.

The returns from single Bitcoin betting may outperform the market

According to current user feedback, the points to token exchange ratio is approximately 68:1, and the total amount of this airdrop is 4.2 tokens. PANews calculated that the total amount of points is approximately 28.5 billion points.

At this amount of points, the price per point is approximately $0.025 if calculated based on the over-the-counter token price of $1.74.

So how much profit can be obtained by staking in Merlin Chain?

According to the above calculation method, the number of MERL tokens that can be exchanged for 1 Bitcoin per day is about 146, and the income amount is about $255 per day. If a user starts staking from February 8th until April 14th, the 66-day staking income is about $16,876.

Would you have earned more if you had not participated in Merlin’s staking activity?

On February 8, the closing price of Bitcoin was $45,288, and it rose to a maximum of $73,777 on April 14. If user A is a trading expert and chooses to just hold Bitcoin during this period and sell it at the highest point, then the maximum spot profit of user A is $28,488, with a maximum rate of return of 62.9%.

User B is assumed to be a loyal user of the Merlin chain. He has staked 1 Bitcoin since the first day of staking and did not choose to withdraw until April 14 (theoretically, he can only withdraw after the Bitcoin halving). Then the user's income is the income from Bitcoin holdings + the income from the Merlin airdrop. The sum of the two incomes is about $37,249, with a maximum rate of return of 82.25%.

In comparison, if the price of MERL tokens can maintain the current trading price after listing, users staking on MERL may be able to avoid certain risks of bull market corrections, but the overall difference is not significant. If the official opening price of MERL falls below $0.83, it is better to sell BTC at a high point in combination with the airdrop income and holding income of MERL.

The pledged profits were cut back by the market?

Since Merlin's points are calculated based on equivalent assets denominated in BTC (10,000 points per BTC per day), with the recent sharp fluctuations in the market, many staked non-BTC assets have been affected by the exchange rate against BTC, causing the double damage of falling spot prices and reduced points.

For those users who pledge RATS assets, staking on Merlin may miss the best selling opportunity. During the Merlin staking period, the highest yield of RATS for holding coins is 169%, while if you choose Merlin staking to obtain airdrops, the overall yield is -10.67%.

For example, at the time of initial staking, user A chooses to stake BTC, and user B stakes RATS, both of which are assets worth 1 BTC. Assume that the initial funds are 45,288 US dollars.

For user A, the number of points he gets every day is the same, which is 10,000 points.

As for user B, the exchange rate of RATS to BTC has been changing and showing an overall downward trend. From February 8 to April 14, the exchange rate of RATS to BTC has dropped by 56.79%, which means that user B’s daily points will be less than 10,000 points. If we estimate this decline process based on linear changes, overall, user B who staked RATS received 220,000 fewer points than user A who staked BTC, which is equivalent to about 2,754 fewer MERL tokens.

Considering that the RATS price fell by about 37.4% from February 8 to April 14, even if the 26.6% yield obtained through staking is taken into account, the overall yield during this period is -10.6%.

However, the above calculation only includes Merlin’s staking airdrop rewards, and does not include rewards from other projects in the Merlin ecosystem. If the airdrop rewards from other projects in the ecosystem are combined, the benefits will be better.

50% of airdrop tokens will be released in the first month and fully unlocked in 6 months

The total supply of MERL is 210 million, which will be released linearly over 4 years. 50% of the 20% tokens in this round of airdrop will be released in the first month, and then gradually unlocked over 6 months. Based on the current OTC price of $1.74, the fully diluted market value is approximately $3.654 billion.

According to the official announcement, MERL tokens will start trading on multiple CEXs including OKX, Hashkey Global, Bitget, etc. at 10:00 UTC on April 19.

Official data shows that during this round of airdrops, 91% came from the Bitcoin native community (including $1.75 billion in BTC and $980 million in BRC-20 assets). From this point of view, most users still choose to use BTC for staking, which is currently the best choice for airdrops on the Merlin chain.

In general, for those users who hope to gain income through airdrops, the last large airdrop, StarkNet, has continued to fall, and has fallen 85% from its peak. When pledging real money in exchange for airdrops, you may also need to consider hedging against changes in market conditions and learn more clever operating techniques. Airdrops are no longer a mindless money-making track.