$VKA - Fundamental Analysis shows Massive Undervaluation

Nov 23, 2023

Perp DEX has a huge $1.5B market opportunity

$VKA is a gem at TVL of $17M and a true MC/TVL ratio of 0.022

Why I think $VKA is massively undervalued + my fundamental analysis 🧵👇

In this fundamental analysis, I am going to cover:

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Key Fundamentals

$VKA sees a staking rate of 80% with over 8M staked
The staking rate refers to the percentage of circulating supply that is currently staked on Vaultka's platform.
With such a high staking rate, it signals that investors are committed for the long-term and see value in holding $VKA.

Vaultka showed a glimpse that they are onto the path of initiating a war for $VKA and this is just the beginning. Why do I think so?

Total bribes currently at $5k but I am expecting more bribes to come
Users can vote with their staked $VKA and $esVKA directing emissions to strategic and lending vaults.
Users have the ability to shape vault selections and receive boosted $esVKA rewards
Vaultka being the leader on Arbitrum for perp DEX liquidty would attract these perp DEXes.
They will compete to accumulate votes, as its much cheaper than building their own liquidity.

@Vaultkaofficial uses a portion of fees generated to buy back and burn VKA tokens on a regular basis.

30% of the protocol revenue will be used to buyback $VKA from the open market and then burning them
This reduces total supply over time and can put upward pressure on the price.
So far, over 380K $VKA tokens have been burned.

As a DeFi protocol, the Total Value Locked (TVL) on Vaultka is a key metric of adoption and usage.

Currently, DexTools is showing circulating supply of 10M $VKA tokens. That is overstated, actual circulating supply and valuation is much lower.

After removing all staked $VKA and Uniswap LP, only 2.2M of $VKA tokens are tradable.
Translating into a very low circulating MC of 600K.
⭐️Real valuation becomes Mcap/TVL = 0.022 ⭐️

@Vaultkaofficial is specifically focused on providing leverage and hedging tools for the fast-growing perpetual swaps market.

With an estimated $1.5B derivatives market size, this niche provides an enormous opportunity if Vaultka can capture meaningful market share.
Vaultka is constantly expanding its addressable markets for perp DEXes by exploring partnerships with other Perp DEXes
Perp DEXes market is going to be massive

We are seeing metrics that are before the distribution of the $ARB incentives and can expect an influx of capital as these incentives goes live.

Different perpDEXs are starting to utilize $ARB from the STIP program to incentivize traders and LPs
GMX has started to distribute $ARB to GMX V2 LPs, which $VKA users, lenders and stakers stand to benefit
Here is the list of projects that will be getting the $ARB incentives

Vaultka focuses on user and TVL growth, and captures share in the massive perpetual swaps market, substantial upside for $VKA appears likely.

For crypto investors with longer time horizons, buying $VKA at current levels could provide strong returns if held through the next bull market.