EOS has largely under performed during this crypto rally and has dropped out of the top ten by market cap, but one industry executive believes it could be one of the best risk/reward digital assets right now.
Chartered Financial Analyst and Arca CIO Jeff Dorman made the assertion based upon Block.one’s extensive Bitcoin holdings.
Before delving into that, Dorman observed that EOS is the only major crypto asset apart from XRP that has not made significant gains during this rally. Over the past twelve months, EOS prices have declined by 26%, with losses recently accelerating due to the resignation of CTO Dan Larimer.
But with plenty of “zombie projects” up 300% to 1,000%, he believes EOS provides a good risk/reward opportunity.
Block.one owns 140,000 BTC worthh an estimated $5.5 billion at current prices according to data compiled by a financial comparison platform Bankr.nl. The CFA compared the market capitalization of EOS with that of its Bitcoin holdings;
Dorman stated that generating a Return On Investment, or ROI, from Book Value is essentially taking a gamble on what management will do with that capital. Block.one and the EOS teams have done very little to instill confidence, he added.
But Dorman suggested that at this point, EOS and Block.one CEO Brendan Blumer need to create value for token holders as soon as possible, or return the capital, or expect huge lawsuits.
He concluded that any one of these three options will unlock this value and close the gap between EOS’ market cap and the value of the Bitcoin on Block.one’s balance sheet, which currently stands at $1.5 billion more than the company raised in its May 2018 ICO.
Not all were in agreement with the CFA with one respondent pointing out that buying EOS is not the same as buying BTC;
The enormous amount of Bitcoin on the Block.one books may lend weight to outspoken crypto podcaster Peter McCormack’s comment:
At the time of writing, EOS was trading at $2.80, flat on the day and down almost 13% over the past week.