Abstract

Sui and Aptos are pioneering the MOVE language and are new L1 in the market. SUI is on a rampage and has 10x TVL since Oct 2023 than Aptos which only has 3x.

It is worth Investing in Aptos for a mid term tenure if we are bullish on the crypto ecosystem in general(which I am) as the stats are moderate-to-good and don’t give too much.

Investment Thesis

After looking at different metrics for speculating on the price of APT which are given below, I divided them into a few parts by focusing more on the on-chain data

• product

• User community

• Dev Community

• Partnerships and Ecosystem

• token unlocks (then we can guess who will sell etc.)

• Onchain metrics

Product

On the product front, I don’t have much to say except that MOVE is an advancement in blockchain technology and if accepted by the community can perform great in the upcoming future.

Aptos has handled up to 30000 TPS before and the transaction fee is about 1 cent along with that there are many amazing new tech stack features in Aptos giving sweat to Solana.

LayerZero has given support for Omni-chain tokens on Aptos and the top protocol named Thala has implemented cross-chain collateral lending

Aptos Labs expects and had implemented most of the new features in the first half of 2024.

User Community, Dev Community

The user base is mostly there for airdrops on new protocols and getting sweet new yields on protocols and staking(LST) as there is very little on-chain activity other than DEX

The slightly lower numbers in the Dapp and NFT categories may indicate potential areas for growth or development on the platform which will come from getting developers on the Aptos chain which they are doing with full zeal at the moment and with monthly released token to foundation it will be very easy to fund these projects and gather a good dev community.

April, May, June - new wallets joined in these months have high retention percentage and the October and November 2023 new wallet cohorts had the lowest one-month retention rates since December 2022, so the HYPE is fading

Partnership

Aptos is going good in partnership with deal already done with top Gaming productions in Korea, collaborating on AI with Microsoft, Alibaba and this also becomes easy with the tokens with the foundation to easily complement the other side in the partnership

Token Unlocks

33% of the investor's and contributors tokens are opened and each year 25% of the investors tokens will be distributed Rest tokens are held by the foundation which it will distribute upon its wish

The locked tokens can also be staked and at the moment 88% of the total supply is staked and most bullish thing is the investor unlocks had started from Oct 2023 but the staked supply has not dwindled much meaning – Token Unlocks didn't had that much affect on token price even after investor unlocks means they are most probably staked.

More tokens are get into market every month through unlocks, it is 2-edged sword as it can lead to more sell pressure as well more community token distribution can lead to more speculation and a net positive for the ecosystem.

More tokens to the Aptos Foundation also means more tokens for developers which will make the new protocol which will then onboard new users for airdrops etc.

Some Onchain Stuff

The bridged amount is less and is about $25 m (wormhole) with $12 m from Solana, $7 m from ETH and $2 m from Fantom and the volume from other chains such as Moonbeam, BSC, Arbitrum is mostly bridged out.
The least number of ETH whales bridged on Aptos as compared to other non-EVM L1 It mostly means that the chain is being used for Farming mostly.

1 interesting info is the volume is flowing out to SUI from Aptos to some point meaning around 2 mil has flown to SUI from Aptos.

Binance Labs are one of the lead investor in Aptos and Binance is depositing more APT tokens in it’s Aptos Contract

Top Whale Accounts has staked most of their APT tokens and don’t have much on-chain activity. Gas Fee are very low, so the tokens in hand will come handy when giving to validators and pools to maintain the money printer
Validator segment is also good(Nakamoto number - fair enough)

Final Conclusion

With multichain communication(Wormhole) becoming easier and easier, liquidity will fragment upon many new L1(SUI, SEI, Monad, Aptos, Inco, Manta) some L1 upon FHE(Inco, Octra, Phenix), zk(Aztec, Starknet, zkSync, ROSE), Defi(Injective - can be redundant after ECONIA) and AI(Aptos) specific and competition will also be with L2(Scroll, MODE, Linea, Mantle, Eclipse), RWA(Plume network).

Aptos is a good investment as Aptos Foundation has a good number of tokens that are vested monthly and can be them to onboard more users & devs through bribes ultimately launching new protocols and bringing new liquidity for airdrops and community rewards, which has already taking shape as – From Nov 2023, Aggregator and Derivative volume also started increasing

It will make an ecosystem of yields and many Defi protocols launching upon the chain which will airdrop 1 year later(Solana's defi protocols are giving now, Arbitrum's will give after some time, and if all is good with Aptos), bringing more fees to burn(Ultrasound money babbyyy)

Investors have the option to stake locked tokens also, most probably will remain staked until 1 year, some like FTX may liquidate their tokens(Less amount)

It will bring Dapp using collaboration etc., to get these Dapps from starting they have to push communities which they are doing, and have great dev tools to build upon

Some Risks

It is in direct competition with SUI and has underperformed badly for the past few months on most of the tickers and SUI has half the inflation rate of Aptos

Foundation Tokens Supply gets empty - this is the main risk due to many aspects Tokens needed for Dev Onboarding Gas Fee is low, to reward Validators Token needed community incentives

These token spends can lead to a decrease in price due to the large number of tokens in the Market from various above sources which are there for a short period BUT this will show in a FEW Years' time when the treasury is depleted and the Aptos has not founded a user base

FOR MID TERM INVESTMENT TIME PERIOD(1 YEAR), APTOS WILL BE A GOOD PERFORMER. BY SPENDING THE FOUNDATION TOKENS IT WILL GATHER A GOOD USER BASE AND A GOOD NUMBER OF DAPPS WITHIN 2024 AND WILL GET IT’S MOMENT OF INCREASED SPECULATION LIKE OTHER L1(SEI, SUI) WITHIN THIS TIME PERIOD

If Crypto Market stays healthy like it is at the moment, then it's price will increase or at best will not depreciate as all the L1 will have a pumping season at liquidity gets rotated and KOLs get paid to rotate.