The European Cup is approaching, which tokens are worth paying attention to?

Original Title: “EURO 2024 narrative for GambleFi: RLB + CHZ to benefit”

Authors: OUROBOROS CAPITAL, 0XRAMEN, MLZE, AERON

Compiled by: Shenchao TechFlow

The UEFA Euro 2024 will be held from June to July. Given that the UEFA Euro 2020 (postponed to 2021 due to the pandemic) attracted over 5.2 billion viewers, we believe this will increase attention on sports-related tokens and GambleFi. For RLB, this is a significant revenue event—currently, sports betting accounts for 30-40% of its revenue, and we expect this proportion to exceed half. As for CHZ, we have observed that historically, such sporting events perform well in the approximately 20 days leading up to the start. Additionally, we see a narrative forming around fan tokens, accompanied by the Dragon8 chain upgrade (smart contracts + decentralized applications) and partnerships (such as Azuro) as additional catalysts.

Rollbit: Euro 2024, More Revenue

Revenue Increase Since Buyback and Burn Initiation: $50 Million Monthly

Since the initiation of buybacks and burns (the starting point of the data), Rollbit's revenue has been steadily increasing—from approximately $40 million monthly in August 2023 to $50 million monthly in April 2024. A significant portion of this revenue growth comes from its sports betting business, which accounted for 30-40% of revenue in April 2024, compared to 15-20% in August 2023.

Source: Rollshare

Buyback Issues

The current revenue level means a monthly buyback of $5.5 million, with an annual buyback of 33% of RLB circulation. This corresponds to a 3x price-to-earnings ratio. So far, approximately 47% of the RLB circulation has been repurchased. Nevertheless, the price trend remains weak, underperforming ETH by 55% since the beginning of the year.

The combination of large-scale buybacks and a weak price trend makes it easy to understand why the market continues to question the authenticity of the buybacks. Given that RLB's primary trading market is on Rollbit itself and lacks transparency, it is difficult to verify whether the buybacks are being sold.

Nonetheless, we believe there is a price floor. At the current revenue level, it would take just over 3 years to buy back all of Rollbit's supply. The amount repurchased is a function of revenue and price.

The more RLB that is repurchased, the stronger its scarcity, the more concentrated the holdings, and the fewer sellers there are. While we are surprised by the historical number of sellers of the coins, we believe that as the "low RLB price / high buyback" scenario continues, token holders will increasingly pressure the team for greater transparency, which has historically translated into positive price action.

Revenue Boost from Euro 2024

The global audience for the UEFA Euro 2020 exceeded 5.2 billion. We expect the UEFA Euro 2024 to attract a similar level of activity, which will drive Rollbit's revenue growth, leading to greater buybacks in the summer (June to July 2024).

Source: Rollshare

Rollbit's revenue is highly volatile, with some good days generating 2-3 times the revenue of poorer days. This is primarily driven by sports betting. With matches occurring almost daily, we expect revenue to increase, thus driving buybacks.

Underperformance and Attention

GambleFi has always been positioned low, making it very suitable as a catalyst-driven long-term investment. We believe Euro 2024 is such a catalyst that should bring attention and buyback funds flowing into the tokens.

Chiliz: Euro 2024 + Chain Upgrade

During the World Cup in November 2022, CHZ was the only token with a narrative fit, with returns of nearly +80% for those who went long on the token about 20 days before the event. We are about 30 days away from Euro 2024.

Source: Coingecko, Ouroboros Research

While we believe that Chiliz's narrative drive for Euro 2024 will attract more attention, it has other catalysts as well, including:

• Dragon8 Chain Upgrade: Chiliz's Dragon8 chain upgrade will go live on May 21, 2024, introducing the EIP1559 fee burn mechanism and a new token economic model, with an initial inflation rate of 8.8%, expected to drop to 1.88% after 14 years. In our conversation with Chiliz CEO Alex Dreyfus, we learned that more dApps (decentralized applications) will be launched on Chiliz 2.0 after the upgrade.
• Azuro Partnership: Chiliz announced a partnership with Azuro to co-sponsor a developer grant program to build an on-chain sports prediction market.