With Polymarket and Hyperliquid combined, Space is essentially "betting on top of betting ...
Written by Eric, Foresight News
Just yesterday morning Beijing time, Space , a leveraged prediction market, announced that it will launch the public sale of its token SPACE at 2:00 AM Beijing time on December 18th, which is tomorrow morning.
The method used in this token sale is quite interesting. After the sale begins, Space will sell $2.5 million worth of tokens with a FDV of $50 million. Once the $2.5 million sales target is reached, the token sale will continue, but the FDV will increase linearly, reaching a maximum of $99 million. After the entire process is complete, Space will allow all investors to purchase tokens at the same price. Although the mechanism is not explicitly stated, it is speculated that an average price might be calculated using some algorithm, and then shares would be allocated based on investment.
Is this race, which will take place at 2 a.m., worth participating in?
Market prediction with leverage
In terms of the mechanism of the prediction market, Space's description is not much different from Polymarket, but since Space's market is not yet online, it may need to be evaluated after the product is available.
Space's main product feature is its leverage, up to 10 times. Let's illustrate this leveraged prediction market trading model with an example:
Imagine a market where the probability of a Fed rate cut in December is 15%. You decide to buy 1000 shares at $0.15 each. Without leverage, this would cost $150; with 5x leverage, the same position requires only $30 in margin. If the probability rises to 30%, your position will double in value, yielding a profit of $150 with only $30 in margin. However, if the probability drops to approximately 13.33%, your position will be forcibly liquidated.
There's nothing particularly difficult to understand about the mechanism; essentially, it allows you to participate in event prediction through margin leverage trading.
Space will distribute airdrops seasonally based on points, which can be earned through trading, providing liquidity through limit orders, referring friends, and community interaction. This might be worth trying for those looking to profit from airdrops. Space states that half of its platform revenue will be used to buy back and burn tokens. Furthermore, Space's token, SPACE, has a unique feature beyond its basic functions: certain markets will exclusively use SPACE as the trading currency.
Former GameFi team starts a new business
Space's team members are currently anonymous. The only disclosed information is that the team's previous project, "UFO," reached a market capitalization of up to $1.5 billion. According to my research, only one P2E blockchain game project, UFO Gaming, has "UFO" in its name and a market capitalization of around $1.5 billion. This project was initially launched on Ethereum and later moved to Solana.
However, achieving a market capitalization of $1.5 billion for the project's token during the last bull market doesn't seem like something to boast about, and the team's capabilities remain to be seen.
On the positive side, one of Space's investment firms, Morningstar Ventures, has invested in many high-quality projects, such as Pieverse (Web3 payments and compliance infrastructure), L1 Particle Network (modular blockchain abstraction), Shiba Inu, crypto game developer Gunzilla Games, and Axelar Network. This provides a strong endorsement for Space.
Is Space worth investing in?
From the perspective of prediction markets alone, even if it reaches its cap, a $100 million valuation isn't considered very high given the current boom in prediction markets. However, the extent to which leverage can amplify bets in the prediction market remains to be seen, as the overlap between leveraged trading and prediction market users may not be as significant as imagined. Furthermore, the prediction market exhibits a highly concentrated head effect, with numerous players possessing greater resources. Even if Space's mechanism creates some demand, its liquidity to support platform growth is questionable.
In conclusion, Space is not a project worth investing in blindly, and those who like to participate in IPOs need to consider it carefully.
