Can the Livepeer (LPT) market break through the previous high when it starts again?

1. Project Introduction

Livepeer is a decentralized video streaming network built on Ethereum as a scalable platform-as-a-service that provides the real-time media layer of the decentralized development stack for developers who want to add live or on-demand video to their projects. solution. Livepeer improves the reliability of video streaming from centralized broadcast services while reducing the costs associated with it by up to 50 times. Video streaming currently consumes 80% of all Internet bandwidth, and companies that distribute videos on the Internet need to transcode the video first (transcoding refers to the process of taking the original video file and reformatting it to ensure that whether it is using 2g or 5g bandwidth or different devices can achieve the best viewing experience), and Livepeer can greatly reduce this cost. The following is an example to introduce how Livepeer operates.

Alice, an app developer, is using Livepeer to add live video capabilities to her high school live sports app. Bob, as the game coordinator, is in charge of broadcasting his high school basketball game live using Alice's app. When Bob opens the app and starts recording, the app sends the live video, along with the live stream fee, into the Livepeer network, while Livepeer transcodes the video into a form that viewers can receive.

There are two main roles in the Livepeer network to ensure the quality of the live broadcast, Orchestrators and Delegators. Anyone can join the network and become a "coordinator" by running software that allows them to contribute personal computer resources (CPU, GPU, and bandwidth) to transcode and distribute video, earning fees. In order to obtain the right to do such work on the network, it is necessary to own Livepeer tokens, LPT. The purpose of the Livepeer token is to coordinate, guide and incentivize participants to ensure that the Livepeer network is as cheap, efficient, secure, reliable and useful as possible. Delegators are Livepeer token holders who participate in the network by "staking" their tokens to Orchestrators. When broadcasters pay the network fees, both the coordinator and delegators will receive a portion of those fees as a reward for ensuring a high quality and secure network.

2. Token Economic Model

LPT tokens are in full circulation, with a market value of 219 million US dollars, ranking 143rd.

In Livepeer, each round (Round) will mint new tokens and distribute them to delegators and coordinators. The round here refers to the unit measured by the Ethereum block, where a round is equal to 5760 Ethereum blocks. The average block time in Ethereum is 14 seconds, which means that a round lasts about 22.4 hours. The current inflation rate of LPT is 0.03165%, and the current total supply is 28,904,976.38 Livepeer tokens, and the next round will award a total of 9,264.04 to all participants

newly minted Livepeer tokens, corresponding to a value of approximately $70,000. The annualized inflation rate corresponding to the current inflation rate is about 12%.

The Livepeer inflation rate will be automatically adjusted according to the pledge rate. The current pledge rate is 44.72%, which Livepeer calls its "participation rate". Livepeer presupposes that 50% is a target ratio for a healthy compromise between network security and token liquidity. When the participation rate is below this level, the inflation rate will increase by 0.00005% per round. When the participation rate is above this level, the inflation rate will increase by 0.00005% per round. will be reduced by 0.00005%.

3. Financing information

LPT is also one of the currencies held by Grayscale Fund. As of September 1, Grayscale’s LPT holdings were US$4.108 million, and AMU ranked 10th among 14 currencies.

4. Price performance

LPT was launched in 2018. The highest price occurred in November 2021. The current price is down 92.3% from the highest price.

The latest wave of market prices began on August 7 this year. LPT rose 43% in a single day from 4.98 to 5.87, and rose to 9.26 on August 13, doubling in a week. At 9:30 this morning, it rose by 12% in 15 minutes, and it has not yet broken through the previous high position. Although the price tried to hit the $8 mark again, the open interest of LPT contracts was at a relatively low level since the start of this wave of market, and there was no significant increase in open interest with the price rise. At present, the funding rate has dropped below -1%, and the long-short position ratio and the long-short ratio of large accounts have dropped to 0.81 and 0.72 respectively.

On the same day that the market started, a large amount of transfers were observed in the on-chain data. The frequency of on-chain transfers throughout August increased significantly compared with the previous period.