Mr. Market is showing some interest in the Hector DAO (HEC). For instance, the Hector DAO was the fourth most trending concurrency on 11 January 2022, CoinMarketCap estimates.
In addition, CoinMarketCap gave HEC a $79.61 Coin Price on 12 January 2022. So what is Hector DAO and is it worth $79.61?
The Hector DAO is a decentralized autonomous organization (DAO) that supports Hector. Hector is a decentralized protocol based on the HEC token. The HEC token will function as the reserve currency for Fantom (FTM). Interestingly, Hector DAO started as a fork of the Olympus DAO (OHM).
What is the Hector DAO?
Hector will use the Algorithmic Reserve Currency algorithm and support other decentralized assets. To explain, a reserve currency is a currency that provides liquidity to other currencies and other assets.
For example, Hector (HEC) can provide liquidity for NFTs and other assets. Those assets will include LP Fees (Liquidity Providers’ Fees) and Bonds.
Like most DAOs, Hector has a treasury that backs the HEC tokens with the treasury balance. They claim the Treasury Balance regulates staking APY. In addition, they claim the HEC Token compounds yields automatically for staking rewards.
Hector Dao claimed to have a Market Capitalization of $237.973 million, a Coin Price of $80.88, a Circulating Supply of 2..942 million HEC, and a Treasury Balance of $135.770 million on 12 January 2022.
They claim the Hector DAO has the healthiest Risk Free Value of the Treasury (RFV) of any similar project. Hector DAO limits RFV by tying it to a runway. They claim that generates HEC tokens.
Hector DAO Ecosystem
They hope to build a Hector DAO Ecosystem by making HEC the reserve currency for the Fantom Opera blockchain.
The Hector DAO will serve as the basis or umbrella of the Hector Ecosystem. The Hector Ecosystem will include the Hector Rebase, which is in charge of bonding, APY, and Rebasing. They hope to implement a bonding curve to use APY to grow the Hector Treasury.
The Hector Crosschain is a sidechain that will connect Hector to DAOs and tokens that are not native to the Fantom Opera Chain. For example ERC20 and Binance Smart Chain tokens.
They are building a Hector Bank in partnership with Rari Capital. An Open Interest Rate protocol will allow Hector DAO users to lend and borrow money through the Hector Bank. Hector’s treasury will make money by charging fees on the transactions. The fees will be the difference between annual percentage rate (APR) Hector charges borrowers and the Annual Percentage Yield (APY) Hector lenders receive. The hope is the fees will grow the Hector Treasury.
I think the Hector Bank could get the Hector DAO in trouble with regulators. Notably, there is no evidence the Hector Bank offers deposit insurance.
Predictably, they create Hector NFTs (nonfungible tokens). There will also be a defi game they call the Hector Game. Hector game players can earn rewards through peer-to-peer play. Hector Game revenues will finance the expansion of the Hector Ecosystem.
Hector users can mint NFTs on the Hector Ecosystem and sell them for HEC tokens. They claim NFT owners can make money by storing NFTs in the Hector ecosystem.
There will also be an incubator and launch pad for Fantom Opera Chain projects they call Hector Launch. Developers can use Hector Launch to raise funds by staking and accessing Protocol-Owned-Liquidity-as-a-Service. New projects could get liquidity.
Hector Swap and protocol-owned liquidity-as-a-service
The Hector Swap is a decentralized exchange (DEX) aggregator. They claim Hector Swap lets users swap tokens for Hector (HEC). The hope is Hector Swap could turn Hector into a financial center in the Fantom Opera Chain. Hector Swap can also serve as a bridge to crosschain offerings and a yield farm.
Hector PRO will offer protocol-owned-liquidity-as-a service. The plan for projects to run funding rounds and sell liquidity to raise money through Hector PRO. Hence, Hector PRO makes Hector into a blockchain investment bank.
The Hector team is conducting feasibility studies for some other projects. Potential Hector projects include a stablecoin and a Hector Pay debit card.
How Much Money could Hector Make?
Mr. Market thinks Hector DAO (HEC) has value. For example, CoinMarketCap gave Hector DAO a $79.61 Coin Price, a $233.558 million Market Cap, an $803.644 million Diluted Market Capitalization, and a 24-Hour Market Volume of $12.265 million on 12 January 2022.
The base those numbers on a Self-Reported Circulating Supply of 2.927 million HEC. CoinMarketCap estimates the Hector DAO was the 2,871st largest cryptocurrency on 12 January 2022.
Similarly, Coinbase gave Hector DAO a $77.80 Coin Price and a 24 Hour Market Volume of $12.3 million on 12 January 2022. I consider Hector DAO unstable because Coinbase gave it an all-time high Coin Price of $357.49. Hence, Hector DAO could be an excellent speculative cryptocurrency because it can fluctuate widely.
However, I see never evidence the Hector DAO can deliver on any of its developers’ promises. Thus, Hector DAO (HEC) is a purely speculative cryptocurrency that people who cannot afford to lose money need to stay away from.
Originally published at https://marketmadhouse.com on January 12, 2022.