A Comprehensive Analysis of Arkham Valuation and Alpha Mining Practical Tutorial

What is Arkham?

On July 10th, Binance announced the launch of the blockchain data analysis platform Arkham’s token $ARKM on LaunchLianGuaid, marking the first tool-based product to be listed on Binance.

In fact, as early as the beginning of this year, we introduced Arkham in the article “Seven New Generation Web3 Data Tools”. However, at that time, it was not well-known and did not appear in the repentant tweets of various KOLs like it does now.

Arkham currently has two businesses, one being a data analysis platform similar to Nansen and 0xscope, and the other being Intel Exchange, an on-chain intelligence trading platform.

Below, we will introduce them one by one, and finally bring you Biteye’s valuation analysis of Arkham.

On-chain data analysis platform and operational secrets

Arkham is a powerful on-chain data analysis platform with the feature of mapping on-chain addresses to entities behind them. Compared with other projects in the same field, Arkham’s advantages are:

1. Providing extensive support for public chains, including Bitcoin and various EVM-compatible mainstream public chains

2. Rich address labels

By utilizing Arkham’s features and advantages, it is very helpful for mining Alpha. Due to its support for multiple chains, detailed label system, and wide statistical coverage, the asset and behavior statistics of each entity are more comprehensive and accurate.

Next, let’s take the trading master Andrew Kang as an example to see how to analyze the behavior of different entities and explore the Alpha within.

(Source: Arkham)

Take the trading master Andrew Kang as an example, simply enter Andrew Kang in the search bar, and his Entity label will appear. There are four major analysis sections after clicking on it:

  • Current holdings

  • Historical asset net worth and gains/losses

  • Recent on-chain interaction objects

  • On-chain operations

For top-level on-chain traders like Andrew Kang, observing their holdings is of great reference value. Currently, AK has earned over $1.7 million through on-chain transactions. His largest holding is RDNT, worth approximately $840,000.

(Source: Arkham)

Through the Portfolio Archive feature, you can view the changes in the number of token holdings and their corresponding values within a specified time period, thereby deducing the trading process. For example, AK has started to gradually sell some RDNT in the past week.

(Source: Arkham)

In the Top Counterparties section, you can see the recent rankings of interactions by the entity, including the number of interactions and the amount of interaction. Within a week, AK has interacted with MUX Protocol 165 times, with an interaction amount reaching $3.19 million.

Many of you may be familiar with AK starting from his order placement on GMX, and from his recent interactions, it is evident that he has found a new favorite in MUX.

MUX is a competitor to GMX, another on-chain derivatives exchange. A platform that allows top traders to switch must have something unique. Users who are interested in on-chain derivative trading can follow AK’s operations to understand MUX.

AK’s daily interactions are very focused, involving various spot and derivative trading. Odos is also an aggregator that is more suitable for professional traders.

The Top CounterLianGuairties feature is used to track professional traders, and it can also be effective for finding opportunities to make a fortune by observing the contracts they have recently interacted with.

(Source: Arkham)

This is just a statistic, and specific operations can be viewed in the Transactions column. Compared to blockchain browsers, this platform aggregates transactions from all chains, eliminating the need to switch between different browsers, which is very convenient.

(Source: Arkham)

Above dashboard link:


Another feature that is very helpful for trading is the token dashboard, which allows you to view the current holdings of specific tokens by major holders.

This feature can also be achieved through browsers like Etherscan, but it only displays wallet addresses without revealing the identity of the token holders. Arkham uses their powerful entity tagging system to directly expose the entities that hold the tokens.

Each token has a cap table that shows token allocation at the time of issuance, but as time goes on, the entire token allocation changes, and this change is often opaque. By comparing the current token holdings with the initial allocation chart through Arkham’s token dashboard, you can know which teams have a long-term perspective and which teams are secretly selling off, providing an extra layer of insurance for value investors.

(Source: Arkham)

In addition to the above analysis features, Arkham also has an alert function. If you are a follower of a trader or pay close attention to the holdings of whales in a certain token, you can use the Alert function to set threshold amounts, observe specific objects, or even specific accounts, and receive direct email notifications when abnormal activities occur.

(Source: Arkham)

The Intelligence Exchange

(Source: Arkham)

Traders, investors, researchers, project teams, and others have an increasing demand for on-chain data analysis. However, they lack the time and expertise to conduct in-depth on-chain analysis.

At the same time, many researchers with on-chain data analysis capabilities are eager for a platform that allows them to monetize their skills. Therefore, Arkham has launched The Arkham Intel Exchange, the first trading platform that supports an economy where users can obtain rewards for on-chain intelligence. It connects people who want to buy or sell any crypto wallet address intelligence in a marketplace.

Buyers can gather any information they want to know by publishing bounties. Bounty hunters can claim rewards by submitting the requested information.

At the same time, anyone who owns a wallet or valuable information can provide this information to other users at a fixed price or through an auction.

This creates a fluid information market, allowing on-chain detectives to turn their work into income on a large scale, intel-to-earn.

(Source: Arkham)

The information that can be traded on the intelligence exchange is not limited to physical tags. For example, a victim of a vulnerability can concentrate resources to obtain information about the exploiters of the vulnerability; a trading company may want to buy information about its own wallet before competitors discover it.

In addition, users who submit information for training Ultra (Arkham’s AI de-anonymization engine) can also receive rewards.

To prevent a large amount of spam information, all bounty hunters also need to pledge a small amount of funds to the smart contract when submitting information. If their application is not approved, this part of the funds will be forfeited.

$ARKM Valuation

Arkham has raised more than $10 million through two rounds of equity financing, accounting for 20% of the total supply of ARKM tokens. The latest round of equity financing is valued at approximately $150 million.

Investors include Tim Draper, Bedrock Capital, Wintermute Trading, GSR Markets, as well as the co-founders of LianGuailantir and OpenAI.

Arkham’s token $ARKM announced its launch on Binance Launchpad on July 10, marking the first data analytics platform to issue tokens.

The total token supply is 1 billion, with an initial circulation of 15%. The sale price for this Binance Launchpad is $0.05, with 50 million tokens to be issued, accounting for 5% of the total supply.

The token distribution and token release of $ARKM are as follows:

(Source: https://research.binance.com/en/projects/arkham)

Arkham is the first project to issue tokens in the data platform/on-chain data tool category, and it is difficult to find suitable benchmarks. The Graph may be the most relevant.

However, since The Arkham Intel Exchange has not yet launched and there is no actual business data to compare with The Graph, only a rough estimate can be made based on the historical return rate of Binance Launchpad.

(Source: https://twitter.com/NintendoDoomed/status/1658052950336614405?s=20)

According to @CapitalismLab’s statistics, taking the median of all LauncLianGuaid projects since 2021, the first-day increase is 12.6 times, the highest historical increase is 25.7 times, the first-day return rate of BNB is 0.015, and the highest historical return rate of BNB is 0.031.

Since the launch of the three tokens since HOOK, all indicators are at a medium to high level. The median first-day increase is 24.4 times, which is 1.9 times the historical median, and the maximum historical increase is 1.4 times the historical median. The first-day return rate of BNB is 1.5 times, and the maximum historical return rate of BNB is 1.3 times.

According to the estimation of the on-line price of $ARKM based on the data of the recent three IEOs, we can estimate the price range of $ARKM as shown in the table below, with a range of $0.77 to $1.32 on the first day.

At the same time, if we benchmark the valuation of Arkham against the financing, we can see that the circulating tokens at the time of listing are 150 million. If the market value is equal to the valuation of equity financing, the token price is about $1. We roughly speculate that the market’s expected valuation will not differ too much from the valuation at the time of financing, so we can temporarily judge that the final price of $ARKM in the short term should not exceed $1 by much.

When the token price is $1, the project’s total market value reaches 1 billion US dollars, which is about 7 times the valuation of equity financing.

(Because the total market value of the project OpenCampus under the closing price of the previous project OpenCampus of Binance LaunchLianGuaid was also 7 times the valuation of financing, and the circulating market value did not differ much from the valuation, we believe that such a multiple is possible.)

It should be noted that as the subsequent unlocking of tokens (7% of the ecosystem will be unlocked for incentives at the time of listing), the circulating market value will increase, and there may be a certain downside risk to the subsequent token price. At the same time, Binance will implement a limit price mechanism within the first five minutes of opening.

During this period, the upper limit of price increase is set at ten times the public offering price (taking $ARKM as an example, the upper limit of price increase will be set at ten times the price of $0.05, which is $0.5). The limit price mechanism will be lifted after five minutes, and trading will proceed normally according to market conditions.

The introduction of this mechanism may also have a certain impact on the volatility of $ARKM during the opening period, limiting the huge fluctuations in the first five minutes after opening.

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