Coin Report #40: DMme

Coin Report #40: DMme

N.B: In the spirit of full transparency, the following Coin Report on DMme is a Sponsored Post.

Welcome to the 40th Coin Report. In today’s report, I will be assessing the fundamental and technical strengths and weaknesses of DMme. This will be comprised of an analysis of a number of significant metrics, an evaluation of the project’s community and development and an overview of its price-history. The report will conclude with a grading out of 10. I hope you enjoy the read!

Introduction

DMme is undoubtedly one of the smallest projects ever featured in these reports. I became aware of it through the founder, Mocho, who is well known in the space, but beyond the odd tweet appearing in my feed, I knew very little about the project itself. I had loose ideas about it being a microcap project focusing on messaging, but I was not aware of progress that had been made or any potential strengths and weaknesses. Having now completed my research, there is certainly plenty to discuss and, as I’m sure Mocho is aware of, there are a number of weaknesses that need addressing, as well as strengths that need highlighting.

I hope this report will prove objective where it must be and fair on more subjective matters. For those who’d like to learn a little more about DMme prior to reading this report, here are some primary links:


Fundamental

General:

Name: DMme

Ticker: DMME

Algorithm: ERC-20

Sector: Messaging

Exchanges: Tidex, CITEX and Crex24

Launch Overview

DMme was launched in February 2019 with a 3% premine of a maximum 60mn DMME tokens (1.8mn DMME), but, following a significant rebranding later in the year, it swapped to an ERC-20 token and burned ~44mn of the supply. As such, there is now 6mn DMME in circulation, with 10mn locked in a team-held address. There was no ICO, but, in the original conception of DMme, there was a masternode network and a masternode presale using part of the premine. Since the rebrand, the masternode network is no longer in existence. All possible DMME are already in existence, so there is zero further emission.

Price-History Overview

As the project is only 9 months old, there is very little price-history available. Further, due to the lack of volume on its earlier exchange listings, coupled with its small market cap, much of the price data is choppy and not particularly helpful. I was able to find a chart providing a few months-worth of data, which I shall cover in the Technical section. For now, it will suffice to say that DMme formed its all-time high at 375 satoshis in November, having been slowly trending up since its all-time low at 38 satoshis around September.

Project Overview

Unlike many projects, DMme is extremely narrow in its goals, but it is very much a worthy one and an ambitious one to boot. DMme is seeking to disrupt the messaging industry, as the compromise of user data becomes more prevalent. It will provide users with encrypted messaging and anonymity with full control of their data. A subscription-based model will be utilised to generate revenues and support the project, with some of these revenues being redistributed to the community.

I look forward to evaluating their progress.

Let’s begin with some Metric Analysis:


Metric Analysis:

Below are listed a number of important metrics, all of which are accurate as of 2nd December 2019. For anyone reading this who has yet to read a Coin Report, it might be worth reading this section of the first report, where any potentially unfamiliar terms are explained. For any terms or metrics specific to this post, I will provide explanations besides the figures.

Metrics:

General:

Price: $0.0194 (265 satoshis)

Circulating Supply: 6,128,078 DMME

Total Supply: 16,128,078 DMME

Exchange Volume: $22,098

Network Value: $118,694 (16.24 BTC)

Maximum Supply: 16,128,078 DMME

% of Max. Supply Minted: 100%

Network Value at Max. Supply: $312,382

Exchange Volume-to-Network Value: 18.62%

Category: Microcap

Average Price (30-Day): $0.0235

Average Exchange Volume (30-Day): $2,307

Average Network Value (30-Day): $144,010

Average Exchange Volume (30-Day)-to-Network Value: 1.6%

Volatility* (30-Day): -0.0183

Average Daily On-Chain Transactions (30-Day): 11.7

Average Daily Transactional Value** (30-Day): $2,567 (source)

NVT*** (30-Day): 46.24

% Price Change USD (30-Day): +15.6%

% Price Change USD (1-Year): N/A

USD All-Time High: $0.0296

% From USD All-Time High: -31.3%

Premine % of Max. Supply: Originally 3% of 60mn, but 44mn DMME burned in rebranding and swap. Now 10mn DMME owned by team.

Premine Location: https://etherscan.io/token/0x9556f8ee795d991ff371f547162d5efb2769425f?a=0x782db3ae31a7406849c84f9bb0189defdd26b4d2

Liquidity (calculated as the sum of BTC in the buy-side with 10% of current price across all exchanges): 0.246 BTC

Liquidity-to-Network Value %: 1.51%

Supply Available on Exchanges: 608,859 DMME

% of Circulating Supply Available on Exchanges: 9.94%

*Volatility is calculated by taking the average price over the given time-period, calculating the difference between it and the highest price and it and the lowest price over that same time-period, and multiplying those figures together. The closer to 0, the less volatility during that period, and vice-versa. Read this for more on volatility.

**Transactional Value in $ is calculated by taking the daily transactional value in DMME and multiplying it by price.

***NVT is calculated by dividing the Network Value by the Average Daily Transactional Value. See here for more on NVT.

 

Supply Emission & Inflation:

Block Reward Schedule: N/A

Average Block Time: N/A

Current Block Height: N/A

Annual Supply Emission: 0

Annual Inflation Rate0%

Circulating Supply in 365 Days: N/A

 

Staking & Masternodes:

Network Staking Weight: N/A

Staking ROI (Annual): N/A

Masternode Collateral Size:N/A

Masternode Price: N/A

Masternode Count: N/A

Masternode Count Growth (30-Day): N/A

Supply Locked in Masternodes: N/A

Masternode ROI (Annual): N/A

Masternode Reward / Block Reward: N/A

Masternode Network Value: N/A

MNV / Network Value: N/A

 

Distribution:

Address Count: 153

Supply Held By Top 10 Addresses: 81.37%*

Supply Held By Top 20 Addresses: 87.97%

Supply Held By Top 100 Addresses: 99.91%

Inactive Address Count in Top 20 (30 Days of No Activity): 10

*#1 is the team address holding 9.5mn; #2 is Crex24; and #3 is Tidex. Excluding these 3, the subsequent top 10 control 10.91% and the top 20 control 16.49%.

 

Analysis:

Given that DMme no longer has a masternode network and that its entire supply is already in existence following the swap to ERC-20, there are fewer metrics to work through here.

Firstly, I will be looking at transaction-related metrics, before moving on through the remaining General metrics and concluding with some Distribution analysis.

Using the DMme block explorer, I calculated that there have been 11.7 daily on-chain transactions on average for the past 30 days, amounting to $2,567 of on-chain transactional volume. This would give DMme an impressive 30-day NVT of 46.24, indicating at least moderate on-chain demand. For context, Bitcoin’s NVT is around 70. What is less impressive is how few transactions there are, on average.

Moving on, let’s take a look at Volatility, which I calculated to be -0.0183. This is the 5th-lowest 30-day volatility amongst previous reports, which is super surprising given the lack of volume (which we shall come to shortly) and the tiny network value; usually, this brings greater volatility in price due to illiquidity.

Next up, let’s take a look at the metrics related to Liquidity:

With regards to buy-side liquidity, I found there to be 0.246 BTC within 10% of current prices, equating to 1.51% of DMme’s Network Valuethe highest degree of buy-side liquidity amongst prior reports, beating out Genesis Vision at 1.22%. Though naturally a product of the small network value, this is still very promising, particularly when considered in conjunction with the fact that all three exchange listings are relatively low-volume exchanges. Further, it goes some way to explaining why price is relatively stable.

Interestingly, for sell-side liquidity, I found that 608,859 DMME was available for purchase across listed exchanges, equating to 9.94% of its Circulating SupplyThis again is a new record, though perhaps a less promising one for speculators. Whilst the results of both liquidity metrics seem to show that, relative to its network value, DMme is rather liquid for buyers and for sellers, having such a large portion of its circulating supply sitting in orderbooks does not indicate a great deal of desire to hold the token.

Moving onto volume, DMme has traded $22,098 in the past 24 hours, equating to a monumental 18.62% of its Network Value. However, its Average Daily Exchange Volume has been $2,307 for the past 30 days, equating to a more modest 1.6% of its Average Network Value for the same period. This is simply due to DMme’s recent listing on CITEX, which has substantially increased its traded volume. Regarding Average Exchange Volume-to-Network Value, DMme is in the bottom-third among previous reports.

Now, I’d like to take a brief moment to mention DMme’s (lack of) Supply Emission:

As the project has an ERC-20 token, where the entire supply has already been created, there is zero further emission, equating to 0% annual inflation. As such, there are no headwinds for price growth and, more importantly, declines in price cannot be due to emission dumps.

Finally, let’s take a look at Distribution:

Using the DMme explorer, I found that there are only 153 current holders of the token, which is around half that of the 2nd-lowest figure recorded in these reports. This is quite disappointing, as, though not a complete picture, it is often a good measure of the progress of a project. Naturally, projects with more token holders tend to have attracted these by progressing towards their aims. Of course, this is not always the case, as ICOs distort these figures for certain projects. Nonetheless, clearly there is work to be done on incentivising more holders for the DMme token.

Regarding the distribution of supply, I did find that the top 10 addresses control 81.37% of the supply; the top 20 control 87.97%; and the top 100 control 99.91%. However, the top address (excluding the burn address of ~44mn) is team-owned and controls 9.5mn DMME, which is over half the total supply. The second and third-richest addresses are Crex24 and Tidex, controlling 1.64mn and 597k DMME, respectively. If we exclude these 3 addresses, the subsequent top 10 control 10.91% and the top 20 control 16.49%. I am not so keen on the idea that over half the supply is in the hands of the team and I was unable to find any publicly-available documentation detailing the purpose of this and justifying the amount.

Regarding the activity of the top 20 addresses (excluding the first three mentioned), I found that 10 were inactive over the past 30 days, 5 were accumulating and 5 distributing, with net inflows of 460,633 DMME, equating to $8,922.

And that concludes this section. Onto the Community:


Community:

There are two primary aspects of community analysis: social media presence and Bitcointalk threads. I’ll begin with the former before moving on to the latter.

Social Media:

Concerning social media presence, there are four main platforms to examine: Twitter, Facebook, Telegram and Discord.

DMme is present on three of these platforms; all but Facebook. To begin, let’s look at the various social metrics that I calculated from the DMme Twitter and Facebook accounts:

Twitter Followers: 1,371

Tweets: 379

Average Twitter Engagement: 2.35%

Facebook Likes: N/A

Facebook Posts (30-Day): N/A

Average Facebook Engagement: N/A

As usual, I will be using RivalIQ‘s social benchmark report for evaluation purposes.

Twitter:

DMme has a small audience on Twitter of 1,371 followers, which makes it the 5th-least followed account from all prior reports. Despite this, the account receives fairly consistent engagement, with an average engagement rate of 2.35%; the 6th-highest of all projects from previous reports. Relative to global benchmarks, this is 261x higher than that of the Media industry and 49x greater than the average across all industries. The primary weakness here is evident – the community size. I’d suggest creating some sort of campaign that incentivises the current community to spread the word organically and grow the platform’s audience.

Facebook:

There is no Facebook page for DMme.

Discord:

There are 3,195 members in the Discord group.

36 new users joined over the past week, equating to weekly growth of 1.1%; this is clearly the project’s largest and most active platform, which is why, as mentioned in the Metric Analysis section, it is a little disappointing that only ~5% of these members likely have their own token address. Although more than 5% will likely hold DMME, most of this is clearly held on exchanges and few have opted to hold their own balances.

That is neither here nor there for the purposes of this section; we are more concerned with the group itself and its interactions. I’d like to begin by mentioning that the group is very well organised, with clear segmentation and a comprehensive list of channels on all manner of topics. There is an Official Links channel that is very useful for new users, as well as a native Roadmap channel and a verification channel for the team to prevent potential fraud.

There are a number of miscellaneous channels within the DMME menu, but we are most concerned with the General and Announcements channels.

Beginning with the latter, there is commonly an update posted once every day or two, with the past month comprising the following Announcements: a listing on Coinmarketcap; a Twitter contest with a giveaway; dark mode testing for the app; an article bounty incentivising new content at 500 DMME per article, with winning articles receiving 2k DMME for 1st place and 1k for 2nd; buy-backs of DMME with linked transaction IDs for verification; a listing on CITEX; and a detailed Medium update on development progress. I like that the team are making a concerted effort to spread the word on social platforms, incentivising users with rewards. One thing I would like to highlight is that it may be worth getting an official legal letter acknowledging DMME as not a security. The reason I say this is due to the buy-back scheme in place and the concept of users being rewarded with a portion of revenues in the future upon app release.

In General, there are a handful of daily messages but less activity than one would expect of some 3,000+ members. Over the past week in the group, I found the most clear description of the utility of the token thus far in my research: that holders of DMME will receive a dividend from the app revenues in ETH and that the token itself will be integrated into the app as its native currency. Thus, the greater the success of the app, the greater the utility of the token. Beyond this, there is a lot of general conversation and some price discussion, as well as support provided for those with issues.

Telegram:

There are 223 members in the Telegram group.

Unfortunately, it is inactive, with no messages since launch in February.*

*UPDATE: The Telegram link provided on the website is incorrect. There is an active group with 107 members.

BitcoinTalk:

The DMme BitcoinTalk thread was created on February 5th, 2019 and has since generated 217 posts spanning 11 pages in 300 days. This equates to 0.72 posts per day, on average. However, in the past 90 days, the thread has had 13 posts via 8 individual posters, giving an average of 0.14 posts per day; a significant decline in engagement.

Regarding the ANN itself, it quite clearly states that is is now out-dated following the rebrand and coin swap, but it has been left as is, with only a link to a Medium article available with the updated details. It would make sense to simply do an overhaul of the ANN with up-to-date information. Despite this, there are plenty of other resources provided with PR materials and social links are also present.

Regarding the past 90 days of material on the thread, I found that the DMme app is currently in beta testing, long-form Medium articles are pushed out by the team, research is provided on the messaging industry worldwide for context, the token was listed on LogicDEX and CoinMarketCap and the app is set for release in Q1 2020.

And that concludes this section on the Community.

Let’s take a look at Development:


Development:

For the following Development analysis, I will be evaluating project leadership, the website, the roadmap, the whitepaper, the wallets and finally providing a general overview:

Project Leadership:

There are 6 team members listed on the website, plus a digital agency is listed for app development (though not named).

There are 2 co-founders (including Mocho), 2 with experience in marketing, 1 developer and 1 advisor. Beyond this, as mentioned above, the team have outsourced app development to a professional agency, which is wise and also shows a willingness to spend. Clearly, the team already know their own strengths and weaknesses.

Website:

https://dmme.app/

The website is quite dated in its design, though somewhat well-branded. Some more distinct design would serve it well. The tagline for the site reads The Next Generation of Mobile Messaging Application, with social links provided beneath it for ease-of-access. The navigation menu is comprehensive, although it could be more well-organised.

The entire website appears on the homepage, so, scrolling down, we first find the features of the mobile app, including end-to-end encryption, no phone number required unlike many messaging services, anonymity, dividends for token holders from app revenues, subscription-based model to subsidise cost of the app and thus no need for advertising and full control for users. Below this, we find the roadmap, which we will cover in the next section.

Moving on, we find the token specification, with details concerning the coin burn, team allocation and contract address. It would be quite helpful to have greater detail on this, specifically regarding the token burn and team allocation; perhaps even just a link to further reading would suffice. Below this, we have the blog, with links to recent articles. We also find links to exchanges and social platforms and an introductory video (maybe this should be further up the homepage, as it would be helpful for new visitors who have no idea about the project). Further down the page, we find information on the team.

Roadmap:

The roadmap is native to the website and is presented as a simple chronological list, segmented by quarter and beginning in Q1 2019. No progress indicator or further reading has been provided.

Beginning in Q1 2019, titled Launch, there were wallet releases; website release; litepaper publication (now defunct); and early exchange listings. Following this, in Q2 2019, the project underwent Rebranding, with more exchange listings, an early android app release with encrypted chat, further app development, overall rebranding, dmme.app domain acquisition, a token swap and an airdrop. As the project moved into Q3 2019, the messaging app was scheduled to become available on Play Store and the Web with a subscription model, app development for iOS and PC, and the token was listed on Tidex. Now, due to the design of the roadmap and its lack of further reading or progress indicators, I, as a potential new user or investor, am unable to determine which of these was actually completed and which have not been, plus there is some confusion around the different apps listed. Is there one app being developed for all platforms or separate apps with differing features?

Moving on, in Q4 2019, the Android app is schedule for private beta and further development. Finally, in Q1 2020, the roadmap states that the full launch of the DMME Chat App will occur on January 15th for Android. April will see the app released on iOS. In summer, there will be peer-to-peer crypto payments within
the app and an encrypted mail service with cloud storage in July. This all needs greater clarifying, as it is somewhat muddled and quite confusing.

Whitepaper:

There is no whitepaper for DMme.

I would suggest perhaps creating some form of cohesive documentation detailing the project’s vision, as this was more difficult to gather across scattered sources.

Wallets:

As DMME is an ERC-20 token, it can be stored on a plethora of wallets, including hardware wallets like Ledger Nano S and Trezor.


Technical

DMME/BTC

DMMEBTC

Now, I was unable to chart the DMME/BTC pair on TradingView or CoinTrader, as I like to, due to the lack of price data on both platforms; however, I was able to find a TradingView chart for it with several months of data on Crex24, which I have provided above and illustrated. In all honesty, due to the lack of volume (itself likely a symptom of a lack of more prominent exchange listings), much of the price-action has been extremely choppy and wicky, with no real structure present over the past few months. That said, we can quite clearly see that DMME printed its all-time high at 375 satoshis in November and has since dropped off towards resistance turned support at 230 satoshis. Further, price has been trending up since the all-time low was printed back in Q3 and trendline support is roughly aligned with this 230-satoshi level.  That said, I am loathe to make any speculative decisions on this price-data, opting instead for current and future fundamental prospects until we have clearer, more substantial price-action occurring. As such, I do believe that DMME is rather cheap at 230 satoshis and a network value of a little over $100,000; however, what is paramount is that the token be listed on more prominent exchanges in order to grow demand for the token in line with the development of the product. There are many projects trading at several dozens of multiples higher that are doing less.


Conclusion

This report is now approaching 4,000 words and it is time to draw it to a close.

My final grading for DMme is 5 out of 10.*

*Once the DMme Chat app is released in January, this will be altered to a 6, as this is a key developmental goal. If the project can also be listed on more prominent exchanges and improve its volume, (excluding wash) I would be willing to upgrade it to a 7. For now, however, a 5 seems the fairest grading.

Here, you can find my grading framework, for reference.

Lastly, here is a link to a Google Sheets file with any significant data from previous reports compiled for cross-comparative purposes. I will keep this updated as I continue to write these reports.

I hope this report has proved insightful and that you’ve enjoyed the read! Please do feel free to leave any questions in the Comments, and I’ll answer them as best I can.


 

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