Do Your Own Reserach
Launchpad projects are usually in their infancy and are most vulnerable to failure for this reason. Like anything financial, commercial or crypto related you should do your own research and seek professional advice where you deem necessary. Nothing prepared, written or verbally stated by Club 101 and its management team is investment advice or financial advice as we are not qualified to provide such advice.
How it works
There are several Launchpads which offer an IDO or Initial DEX Offering. This provides early investors the opportunity to buy an allotment of a new token (offering) at an attractive rate, usually lower than the DEX price (the DEX being the Decentralized Exchange, for example Uniswap).
To be eligible for such Launchpad opportunities there are certain requirements that must be fulfilled. These are;
- You must complete KYC (Know Your Customer)
- You must stake a sum of the Launchpad Token
- You need to buy all, or part, of the allotment assigned to you based on your stake
Let’s look at each part of this process in more depth.
The size of your stake in a Launchpad determines the size of your allotment. Staking thresholds vary across each of the platforms and you are unlikely to fully know your allotment size until the day of the release.
The higher the stake category the greater the allocation you will be assigned.
To invest in all 10 of these platforms at the same time would cost approx. $500,000. Even to invest in one platform at the highest amount would cost approx. $35,000 or around 9eth (including gas and fees), and this is considering Eth at $4,000.
It’s important to note that the staked value is not entirely at risk. It is simply staked and you are rewarded with APY (Annual Percentage Yield) with percentages varying across each platform. However, the value of the stake can decrease (or increase) dependent on market forces and it is no different to any other token within the crypto-verse in this respect. As they say, it will either go up or down but it will definitely go up or down.
The staked sum is locked for a fixed duration. Again, these durations vary. For Club 101 this is not such an issue as generally the club would look to leave its stake in place ready for the next opportunity. Of course, it will monitor prices to see if withdrawing and re-purchasing is beneficial in any way.
As mentioned above, the size of your allocation is dependent on your stake category. To give this some substance a test run was performed to allow us to collect data and provide actual examples.
A Gold Level stake in ADAPad ($53,000) achieved 2 allocations with the following approximate values;
Private Sales = $300
Allocation = $1200
The above demonstrates the small size of the allocation, in monetary terms, available at the highest level of staking category.
In terms of tokens, the $1,500 allocation amounted to 1.6million tokens.
Of course, having millions of tokens is hopeless if they are worth nothing.
In the above example, on day of DEX launch (where it became publicly available) the token was worth 7x its purchase value. The test run will not be complete until late January 2022 when the full release of the tokens is permitted.
Take nothing for granted here in respect of multiplying allocation values. Some projects failed at the first hurdle and the $1,500 would be lost in such instance. On the flip side you can do your own research and see some of the very successful projects and do your own calculations to draw your own conclusions.
Having bought your allocation of that token, the next event will be the launch of that token on an exchange, such as Uniswap or Pancake Swap.
Each Launchpad prevents a “pump and dump” scenario by releasing your purchased tokens in tranches. The first tranche is usually between 15% and 20%.
This is an important mechanism as it allows the project to sell its tokens at a lower cost than it lists on the exchange.
For example, let’s say you bought a token at a price of $0.01 and it lists at $0.10. You would have 10x that purchase on day one (very unlikely to happen like this but bear with it). In such a circumstance most people will dump that token and take a quick and easy return. That model is poor. Releasing in tranches, as these launchpads do, allows projects a chance of success and that success can be a multiplier for the token that has been purchased allowing for a win-win scenario.
The locked in periods vary but (early results) our test run with ADAPad allowed 15% release of our tokens on purchase and the other 85% approximately 1 month later.
Getting a return from these purchases is difficult to predict and will require some time, effort and experience. That is because each project will be different and knowing the exit strategy will always be at the foremost of people’s minds.
Club 101 will operate a periodic Airdrop. There will be little by way of announcements. This is by design. Club 101 wishes for its members to be involved and therefore the best way to find out about Airdrops will be in the chatrooms of the Discord.
Club 101 will look to Airdrop tokens at the earliest opportunity and at the highest frequency it is able to do so. This way each member can make their own decisions on holding those tokens or selling them.
Now that we have explained how it works we will explain how we will use the allocated funds.
When the full sales value is available we will be able to invest in all 10 identified platforms at a rate of x2. This means we will invest in each of the 10 platforms twice over. This means that any success that Club 101 achieves will have a multiplier of x20 (as we will have 2 allocations on each of the 10 platforms).
Should sales be slower than forecasted then Club 101 will purchase each stake in a piecemeal fashion until we reach the maximum spend of the allotted budget across all platforms.
The vehicle for these purchases will be a UK Company which will be properly registered and audited.
Airdrops will be in the token that we purchase. As stated above, an initial release and Airdrop will be made as soon as we are able to do so.
Airdrop allocations are pre-determined as follows;
|Category||Allocation of airdrops shared by membership group|
|Business costs / business development||35%|
35% of all returns are allocated to the business. This fund will be used as follows;
- Dev Team costs
- Re-investment into building the community, for example further metaverse spaces
- Business Running Costs including staff costs, taxes, accountancy and legal fees
- Founders Dividends – the 4 founders will each take an equal share of any available dividends
The management of the business and all associated income, expenditure and/or dividend is Ancient Dragon business only. The management of this fund will not be shared with a wider audience. Any information that is shared will be at the discretion of the 4 Ancient Dragons.
Club 101 aims to create an exclusive club and it is important a ‘floor price’ above the original selling price is maintained. This should happen naturally in our opinion, however there will always be people wanting to sell for their own reasons, and that is perfectly acceptable. We will never berate people for that. In fact, Club 101 will want to help its members to maximize their selling power rather than selling at a loss – because we do not want anyone to make a loss if we can help it (but this is not something we can guarantee).
There are several ways we can help promote this. Firstly, we will maintain a waiting list. This will allow private sales should people wish to leave the project. It also allows those on the waiting list an equal opportunity to buy in at sensible prices.
Before any Airdrop there will be a “snapshot” taken. Any member who has listed their membership below 1eth will NOT qualify for the airdrop. That suggested floor is not high considering the lowest membership is 0.51eth.
Club 101 is not intending to raise this bar any further. The floor should find its own rightful place. Also, people should not feel there is a barrier to exit. Club 101 is about equality and giving people equal opportunity to enter is one thing, but we are thinking bigger, and we understand there has to be an equal opportunity exit.
Any member who does need to sell below the 1eth floor will never be banned from our Discord or berated in our chatrooms. We are very clear on this point. Club 101 fully appreciates that every member will have their own circumstances and we will not tolerate such behavior in our chatrooms which we believe is nothing more than bullying. Those who are perceived as bullying will be addressed and this may result in removal from our Discord.