# LooksRare Economic Model Interpretation and Valuation Analysis

By [0xAisaka](https://paragraph.com/@0xaisaka) · 2022-01-13

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### LOOKS allocation

Total amount: 1B

Allocation:

*   Airdrop 12%
    
*   Strategic Investment 3.3%
    
*   Liquidity Management 1.7%
    
*   Trading Reward 44.1%
    
*   Staking Reward 18.9%
    
*   Team 10%
    
*   Treasury 10%
    

Unlocking period: two-year linear unlocking

![](https://storage.googleapis.com/papyrus_images/d7e263191b4333504def27ac99eea880b789fc43fbd6a4d86bfcc3ce4833c7cc.png)

### Value Capture

100% [#LooksRare](https://twitter.com/hashtag/LooksRare?src=hashtag_click)'s trading fees are distributed LOOKS stakers. Staking users can also receive a total of 18.9% of [$LOOKS](https://twitter.com/search?q=%24LOOKS&src=cashtag_click) Staking rewards.

![](https://storage.googleapis.com/papyrus_images/9e9ea55ba3ac7faa42f43a8c9aeaf4653cacef4b61de99b388d7d1257171f7e5.png)

### Trade Mining

For the first 30 days, 2,866,500 [$LOOKS](https://twitter.com/search?q=%24LOOKS&src=cashtag_click) per day will be distributed to buyers and sellers according to the transaction volume.

![](https://storage.googleapis.com/papyrus_images/ea4cc8e4fe534b018661d080deae25c182bedfc9dc80dfa09a6c6b27f770e45d.png)

### Trade Mining Cost and Income

Trading cost : 2% transaction fee + 5%~10% copyright fee(set by NFT creators) + Gas Fee.

If choose to trade with NFTs of no copyright, our average cost is 2%.

Based on yesterday's trading volume of $325B, our trade on LookSware is profitable.

![](https://storage.googleapis.com/papyrus_images/da3eb488079ecc6e37e08f1f5c0a9342dd9f151653493973a8ab7b7cb9f5f08f.png)

### Valuation Analysis

[#Opensea](https://twitter.com/hashtag/Opensea?src=hashtag_click)'s latest round of financing is valued at $13B. According to the burning data of Ethereum, LooksRare is 1/5 of Opensea.

So a reasonable estimate of LooksRare is $2.6B FDV.

![](https://storage.googleapis.com/papyrus_images/800e01d4e9f3b570f626f79e5a4cb0f02cfd44aeed21cc079e7c8bda5009c13b.png)

According to transaction volume, the transaction volume of [#LooksRare](https://twitter.com/hashtag/LooksRare?src=hashtag_click) on January 10 was still 1/5 of that of Opensea, but with the introduction of trade mining incentives, the transaction volume of [#LooksRare](https://twitter.com/hashtag/LooksRare?src=hashtag_click) on January 11 was more than twice of [#opensea](https://twitter.com/hashtag/opensea?src=hashtag_click).

![](https://storage.googleapis.com/papyrus_images/357404858a2cd51385ce20661d75a2142695d0fba606cc81fd7bf8fd308b9394.png)

It can be seen from the transaction volume ranking that [#LooksRare](https://twitter.com/hashtag/LooksRare?src=hashtag_click) and [#opensea](https://twitter.com/hashtag/opensea?src=hashtag_click) don't overlap, so there are many wash traders. This phenomenon is more pronounced in the first 30 days, so [#LooksRare](https://twitter.com/hashtag/LooksRare?src=hashtag_click) is valued at less than $2.6B.

![](https://storage.googleapis.com/papyrus_images/54e8429e6cd46ad263deb827a7e003496ced17d628595d1911684e1af62907a6.png)

### Summary

*   [#LooksRare](https://twitter.com/hashtag/LooksRare?src=hashtag_click)'s valuation below $2.6B.
    
*   2 year release cycle is fast.
    
*   The team is anonymous and GitHub has no content, so the transparency is low.
    
*   If the daily trading volume in the first 30 days is less than $427M, using 2 accounts to trade with each other is profitable.

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*Originally published on [0xAisaka](https://paragraph.com/@0xaisaka/looksrare-economic-model-interpretation-and-valuation-analysis)*