Coin Report #68: OctoFi

Coin Report #68: OctoFi

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

Welcome to the 68th Coin Report. In today’s report, I will be assessing the fundamental and technical strengths and weaknesses of OctoFi. 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

For today’s Coin Report, I will be taking a look at a relatively new DeFi project; and one that is certainly much more than might appear at the surface. There is a great deal to work through in this report, so I will refrain from any further preamble but do prepare yourself for a journey into the Octoverse – it is a strange and wonderful place.

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 OctoFi prior to reading this report, here are some primary links:


Fundamental Analysis

General:

Name: OctoFi

Ticker: OCTO

Hashing Algorithm / Token Type: ERC-20

Sector: Decentralised Finance / Oracles

Exchanges: Uniswap, Hotbit & Bilaxy

Launch Overview

OctoFi was launched by an anonymous team in mid-August 2020 as a decentralised finance solution with no venture capital backing. Its native token – OCTO – was created on the ERC-20 standard and issued via a public sale. This public sale took place on September 14th, 2020 and tokens were allocated via a bonding curve between $0.18 per OCTO and $1.08 per OCTO, with 125,000 OCTO of the 800,000 OCTO maximum supply available in the sale. All 125k OCTO were sold, raising approximately $87,000 at an average price of $0.70 per OCTO.

Of the remaining 675,000 OCTO, 275,000 were allocated to the Project Reserve, 200,000 to the Team and Early Backers and 200,000 to the Interest Program. Both the Project Reserve and Interest Program funds – totalling 475,000 OCTO – are community funds, with the former providing funding for development via community governance on proposals and the latter providing rewards for DeFi solutions. Beyond this and the $87,000 raised from the public sale, the project is self-funded.

OctoFi launched their Aquafarm DeFi portal in early October 2020. They are also currently developing decentralised oracles tentacles.

 Price-History Overview

As OCTO has only been in existence for three months at this point, there is very little price-history available. That said, I will be covering what is available at length in a later section; for now, it will suffice to say that OCTO formed its all-time high against the Dollar at $42.37 on November 21st, 2020. Against Bitcoin, its all-time high was printed at 0.00226 BTC. Regarding its all-time low, this was formed shortly after early trading began in September at $1.47.

Project Overview

OctoFi is a decentralised finance project, that much is clear from the briefest of glances. However, much like the octopus, it is multi-faceted tentacled. The primary purpose of OctoFi is to build a community-owned decentralised finance platform, within which a multitude of DeFi tools and solutions will be available. These include investment opportunity aggregation, liquidity pools, decentralised oracle aggregators, fiat on-ramps/off-ramps, derivatives and a CEX competitor, all of which will be exclusively governed by OCTO holders.

As stated on its blog:

“OctoFi is a next generation open source platform providing decentralized finance oracles tentacles for DeFi. We believe that the term ‘oracle’ itself implies unreasonable dependence on a single source of truth. In most cases, an oracle is viewed as singular, and while we appreciate their importance, we foresee the existence of many, all of which are auditable against one another.

Within the decentralized finance world, individuals shall act as proxies to an aggregation of oracular data sources, in order to optimize their own participation and interaction with an ever expanding landscape of protocols.

OctoFi users will benefit from an ‘octomized’ structure whereby ‘tentacles’ connect them with various applications, while leveraging truly open and transparent infrastructure. Stakeholders will play an important role in data validation while pioneering a new frontier of community governance for long term, sustainable adaptability.

Tentacles are essentially incentivised data oracle aggregators kept honest by the community.”

Despite its limited existence, I look forward to evaluating its progress in this respect.

Let’s begin with some Metric Analysis:


Metric Analysis:

Below are listed a number of important metrics, all of which are accurate as of 21st November 2020. 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: $39.68 (0.00212 BTC)

Circulating Supply: 311,748 OCTO (source)

Total Supply: 800,00 OCTO

Maximum Supply: 800,000 OCTO

% of Max. Supply Minted: 100%

Network Value: $12.370mn (662.74 BTC)

Network Value at Max. Supply: $27.363mn

Exchange Volume: $3,754,658

Exchange Volume-to-Network Value: 30.35%

Category: Lowcap

Average Price (30-Day): $14.46

Average Exchange Volume (30-Day): $872,798

Average Network Value (30-Day): $7,174,825

Average Exchange Volume (30-Day)-to-Network Value: 12.16%

Volatility* (30-Day): -0.594

Average Daily On-Chain Transactions (30-Day): N/A

Average Daily Transactional Value** (30-Day): N/A

NVT*** (30-Day): N/A

% Price Change USD (30-Day): +437.8%

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

USD All-Time High: $42.37

% From USD All-Time High: -6.5%

Premine % of Max. Supply: 0

Premine Location: N/A

Liquidity (Uniswap): ~$755,000 (~1 BTC in buy-side on Bilaxy but the vast majority of liquidity is found on Uniswap)

Liquidity-to-Network Value %: 6.1%

Supply Available on Exchanges: 19,491 OCTO

% of Circulating Supply Available on Exchanges: 6.25%

*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.

 

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

 

Token Sale:

The following details were taken from this source, this source and this source.

Public Sale Period: September 14th 2020

Total Tokens: 800,000 OCTO

Total Tokens Available for Sale125,000 OCTO

Total Raised: ~$87,000

Average Price Per Token: $0.70 (allocated on a bonding curve between $0.18 to $1.08)

Total Tokens Sold125,000 OCTO

Token Distribution:

  • Public Sale: 125,000 OCTO
  • Project Reserve: 275,000 OCTO
  • Interest Program: 200,000 OCTO
  • Early Backers and Team: 200,000 OCTO

 

Distribution:

Address Count: 2,192

Supply Held By Top 10 Addresses: 36.36%*

Supply Held By Top 20 Addresses: 50.5%*

Supply Held By Top 100 Addresses: 80.1%*

Inactive Address Count in Top 20 (30 Days of No Activity): 7**

*Excluding team and exchange addresses and calculated as a percentage of circulating supply.

**Excluding team and exchange addresses, but including subsequent private addresses in the rich-list.

 

Analysis:

Unlike for many reports, there is a little less material to work through here due to the lack of supply emission. I’d like to begin by looking at the General metrics before moving onto that lack of Supply Emission and Inflation and then concluding this section with some Distribution analysis:

Firstly, let’s take a look at OctoFi’s Volatility, which came in very high. I calculated its 30-day figure to be -0.594, which places it 2nd-highest among prior reports. This is undoubtedly indicative of a move away from consolidation into the middle of a cycle, which we will take a closer look at a little later in this report.

Moving on, let’s take a look at the two Liquidity-related metrics:

OctoFi is a little different to the bulk of reports previously published, as it is not really concerned with CEX listings, therefore traditional orderbook analysis is not particularly useful. That said, across Bilaxy and Hotbit it had ~1 BTC of  buy-side liquidity. However, this pales in comparison to the ~$755,000 of liquidity available on Uniswap, which is 6.1% of its network value.

Looking at the sell-side, I calculated there to be 19,491 OCTO available for purchase on both Uniswap and the CEX orderbooks, equating to 6.25% of the circulating supply. This is 8th-highest, relative to previous reports, suggesting that there does appear to be a high degree of willingness to sell, although not necessarily at current prices.

Before I move on from the General metrics, let’s take a look at those related to volume:

OctoFi traded $3,754,658 of Exchange Volume over the past 24 hours, equating to 30.35% of its Network Value; a monumental figure made all the more impressive by the fact that it is effectively all legitimate, with the majority of traded volume occurring on Uniswap. Unfortunately, it is likely to be somewhat of a false one, although through no fault of the project itself. If we discount the wash trading on Bilaxy and HotbitOctoFi traded $2,742,375  in the past 24 hours, equating to a still-impressive 22.17% of its Network Value. Further, its Average Daily Volume for the past 30 days was $872,798, equating to 12.16% of its Average Network Value for the same period. This is promising, as it indicates sustained speculative interest in the project. It is also the 9th-highest figure recorded in these reports.

Now, with regards to OctoFi’s supply emission, in short, there is none. This is due to all OCTO being in existence already. That said, 225k OCTO is locked out of circulation until a later date, so it will rejoin circulation at some point, with 200k of this locked for one year – until October 2021. OctoFi has no annual inflation, thus no real headwinds for price growth. 

Let’s wrap up this section with a look at Distribution:

Looking at the OctoFi rich-list, I found that there were 2,192 holders, which is the 10th-lowest figure found in these reports. That said, given that OctoFi is only ~3 months old, this is not bad at all.

Of these holders, the top 10 addresses control 36.36% of the circulating supply; the top 20 control 50.5%; and the top 100 control 80.1%. This excludes the team and exchange addresses in those respective bands, but does include subsequent private addresses to replace them. As a percentage of maximum supply, that top 10 controls 14.17%; the top 20 controls 19.7%; and the top 100 controls 31.21%. If we do look at team and exchange addresses, there is 466,679 OCTO within the top 10 and 474,992 in the top 20, making up the majority of maximum supply but partly locked out of circulation. If we include all addresses in our calculations, then the top 10 controls 68.28% of the maximum supply, the top 20 controls 76.06% and the top 100 controls 91.34%.

Regarding the activity of  the top 20 non-exchange/team addresses, I found that 7 were inactive over the past 30 days, with 6 of the remaining 13 addresses in active accumulation and 7 in distribution. The net inflow to the top 20 over that period is 15,622 OCTO, equating to 5% of circulating supply.

Let’s now take a look at the OctoFi 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.

OctoFi is present on two platforms: Twitter and Telegram. To begin, let’s look at the various social metrics that I calculated from the OctoFi Twitter and Facebook accounts:

Twitter Followers: 4,833

Tweets: 1,209

Average Twitter Engagement: 0.59%

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:

OctoFi has a relatively small Twitter audience of 4,833 followers, which places it 17th among coins previously reported on. Despite a small audience, it has only modest engagement at 0.59%. This is 13.1x greater than the average across all industries of 0.045% and 21.8x greater than the average in the Tech and Software industry of 0.027%; however, relative to other Coin Reports, it is 16th-lowest.

That being said, the engagement rate here does not reflect the community on this platform, in my opinion. That is because OctoFi’s Twitter has a high volume of tweets (over 50 posted in the past week), with plenty of these being memes related to the OctoFi branding. This, whilst diluting the average engagement per post, succeeds in fostering community growth, integration and identity, at least from what I can see.

Facebook:

There is no Facebook page for OctoFi.

Discord:

There is no Discord group for OctoFi.

Telegram:

There are 1,792 members of the OctoFi Telegram group. There are also 2,047 members of the News channel.

I have provided my key takeaways from recent activity in the group below:

  • This is one of the most active groups I’ve ever seen, and perhaps the most active when one accounts for group size – groups 5 to 10 times larger have been 90% less active. There are hundreds of daily messages and thriving conversation.
  • The pinned messages are updated daily to reflect new development updates – this is ideal for new users/community members to remain well-informed.
  • The community are palpably excited about the developmental progress being made by the team, particularly the pace at which they are developing.
  • There is also huge community involvement in the project (unlike for many projects) as the bulk of governance is already community-driven, thus there is vibrant debate on the future of OctoFi.
  • The group already seems quite tight-knit despite OCTO being in existence for three months at this point.
  • The team are fully active in the group and are consistently responding to suggestions, queries and promoting general discussion.
  • The core purpose of OctoFi is reiterated a lot – to make DeFi accessible and to do it without VCs and closed doors. Everything is open source and community driven.
  • The high transparency and constant communication seems to be key here for both the team and the community.
  • The willingness of the community to adopt and integrate the Octopus memes is evidence of the team’s successful branding and community-building strategies. Unlike many projects, where community and team feel palpably separated, the feeling here is one of cohesion.

Overall, very promising stuff for such a new project.

BitcoinTalk:

There is no BitcoinTalk thread for OctoFi.

In conclusion, the OctoFi community is without doubt among the most vibrant and engaged I have seen, particularly when one considers that the project itself has only been in existence for three months. That said, its scope is somewhat limited by its presence on only two platforms. Spread those tentacles far and wide, folks.

Let’s now take a look at its 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:

The OctoFi team is anonymous for the purpose of decentralisation of the project; a quality that is not only simply stated to be true but followed through, as is evident from the governance system in place. In fact we navigate to the DAO dashboard for governance, we can see that there have been 14 proposals since mid-September.

There is one listed team member on LinkedIn – Alexander Perry, the Project Manager.

Overall, despite the lack of transparency on the team itself, the transparency of the team in their development (see the Transparency Reports that I will be looking at a little later for an example of this) is abundant. Moreover, the progress being made – as we shall see -without any venture capital backing and only $87,000 in public sale funding is impressive, to say the least, affirming their abilities.

Website:

The website can be found here.

Right off the bat, there is impressive branding and design, with the site being instantly distinguishable from other crypto-related websites. There is also clean UI/UX and a clear navigation menu with Roadmap, Community (Telegram), Github, Help, Blog and News pages (although it would be helpful to include the Documentation sub-site here too, alongside its current placement further down the homepage). We also find a Launch App button in the top right of the header that leads the user to the Aquafarm app. Lastly on the website design, the branding goes as far as to display flying octopuses on every click, which aligns well with the meme-focused nature of their marketing.

Looking at the homepage, we begin with a link to the Documentation sub-site (which I will cover later), with the tagline reading Invest in DeFi from a platform you own. We are also introduced to the three primary traits of OctoFi: being open-source, community-driven and venture capital-free. As we scroll down, we find links to third-party tools (Uniswap, CoinGecko etc), followed by a visual introduction to OctoFi’s
DeFi platform, which is immediately recognisable as user-friendly in its design (see the image below).

aquafarm

We are invited to launch the app and thereby utilise OctoFi’s DeFi tools, such as portfolio management, liquidity pool tracking, direct exchange of assets, governance participation and more. Below this, we find a series of recent blog posts. This native blog is detailed and regularly updated, showcasing the transparency of the team. Moreover, monthly Transparency Reports are published on top of regular development updates, a few of which I would like to take a more detailed look at here, alongside the documentation:

Blog and Documentation

  • Security Report: As voted for by the community, OctoFi has had a series of both internal and external audits, with MythX and Securify finding no major vulnerabilities in both the OCTO Yield Smart Contract and the OCTO token code.
  • Transparency Reports #1, #2, #3 and #4: Within these monthly transparency reports, the team provide clear and detailed explanations of all fund usage and progress, beginning with the first report in which the token contract was created and the public sale was scheduled for September 14th, 2020. In the second report, clear token allocation is detailed, with 125k OCTO allocated to the sale, 275k to the project reserve, 200k to the Aquafarm Interest Program and 200k to the team. The addresses for each of these is made available. Turning to the third report, here we find a list of token spends, with 544,479 OCTO and 70,000 USDC spent (although the bulk of the OCTO spend is transactions into dedicated addresses for the Interest Program, Bonding Curve Sale and Early Backer (team). There were also a series of proposals funded. In the most recent report, we find that the team locked up 200,000 OCTO for a year (fully audited) and a further 25,00 OCTO to be streamed back into the project reserve over 6 months gradually.
  • Aquafarm: In October, OctoFi released Aquafarm, which is there DeFi solutions platform. On it, users have access to a DeFi dashboard with portfolio tracking, an Invest tab where users can explore investment opportunities currently available within DeFi, and an Exchange tab that has Uniswap integrated to allow for asset exchange. Moreover, in future releases, OctoFi will have a fiat on/off ramp for ease of access and will launch Octomask, which will be a comprehensive browser plugin for Ethereum, Binance Smart Chain, Tron, EOS and more.
  • Tentacles: This is OctoFi’s term for their decentralised oracle aggregator, which is currently in development. Unlike many projects, which focus on the use of a single source of data via an oracle, OctoFi are seeking to make oracles auditable against one another, thus aggregating data sources via tentacles. OCTO will be used to govern the system, to reward data provision, to verify data tentacles, for staking and for gaining access to some of these live data feeds and an API marketplace.

Roadmap:

The roadmap can be found here. There is also a detailed, complementary blog post that can be accessed here.

Currently, the roadmap is available as a chronological list of goals and milestones, segmented by month, from completed goals through to January 2021, each with a check-box to indicate completion. Moreover, we also find a list of value propositions for OCTO holders, including:

  • Access to exclusive features on the Aquafarm platform
  • Fee share from the platform, relative to OCTO holdings
  • Voting rights via the governance system
  • No fees for trading

Turning to the roadmap itself, here we begin with completed goals, which include the launch of Aquafarm – the OctoFi decentralised finance platform – with early features including access for OCTO holders only at present, a history tab for transaction displays, TokenSet integration for browsing investment opportunities, Snapshot.Page governance integration, dark mode, beta release of oracle aggregation via Tentacles, a fiat on/off-ramp, pool aggregation and a user-friendly dashboard. Given that this was less than two months after launch, this is very impressive – some projects with millions in ICO funding do not complete as much in twice as much time.

Turning to #NoCexNovember (I appreciate the continued to effort to bring humour to an otherwise dry space), OctoFi are working on an updated release for Aquafarm, the inclusion of Lending and Borrowing aggregation for Compound and Aave and fundamental development for the final release of the platform. It would be helpful here to perhaps have links to further reading materials on these goals, perhaps from the blog.

Next month, we have #Dexember, where the team will be working to release the first version of their CEX competitor on Aquafarm, with basic and advanced trading available. This will be open for testing and later in the month will see the addition of derivatives, market maker functions, new asset listings via Kleros integration, combining of all liquidity pools into a single one and the addition of NFT trading functionality. Certainly plenty to look forward to, here.

Finally, we come to January 2021, where OctoFi will be activating the revenue share scheme for OCTO holders, who will receive a proportional amount of trading fees collected on the platform. Moreover, the team will be release a drag and drop trading strategy builder, adding bridges, gateways and cross-chain swaps, releasing platform mirrors to further decentralise the project, releasing config file saving and more. This roadmap will be updated with more detail in the coming weeks.

Overall, it is hard not to be impressed with the work that has already been done, and therefore it is difficult to expect any less from the team than precisely what they have laid out for the coming months. Great stuff!

Whitepaper:

There is no whitepaper available but there is a documentation sub-site for new users to better understand the project, which I have already covered above.

Wallets:

OCTO is an ERC-20 token and thus can be stored on any ERC-compatible wallet, including hardware wallets by Ledger and Trezor and a plethora of web wallets and local clients.

And that concludes my fundamental analysis of OCTO.

Let’s finish up this report by taking a look at price-history:


Technical Analysis

OCTO/USD

OCTO1H

As we can see from the chart printed above, there is not a great deal of price-history available for OCTO, with the token only having been traded since mid-September. That said, it is quite clear to see that price has begun its first major bull cycle.

If we begin in September, OCTO began trading a little over the highest ICO price, printing its traded all-time low at $1.46. From there, price rallied swiftly into an all-time high at $15.80, before finding resistance, pulling back and forming a support base at $6.25. This base held for several days before price ran to a new high at $19.53, followed by a retrace back into support, where a new range formed between $6.25 as support and $15.80 as resistance. This range held for weeks, before – in early November – price rallied to range resistance and broke out, consolidating below the all-time high and eventually breaking it around November 11th. Since, price has begun a parabolic advance, evident by the steepening curve of the rally as new highs have printed, with prior highs being flipped as support. This is great news for holders, as there is clearly a huge amount of momentum here for OCTO (particularly for those of us that bought around range support, as mentioned in a previous Market Outlook post). That said, for new market participants, there is no high reward play here at all-time highs. The options are to buy a dip into support with a very tight stop (perhaps on a close below the 200hMA, which seems to be supporting the trend firmly) or to wait for the bull cycle to play out and buy the blood in the future. Either way, I do not doubt that OCTO is here to stay and there will certainly be low-risk/high-reward opportunities moving forward.

And that concludes my evaluation of OctoFi.


Conclusion

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

My final grading for OctoFi is 8 out of 10.

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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