The math behind the new $5 price target. As predicted in Preparing to Launch, Divi and La Liga announced today that the Divi Wallet for MENA, SEA, and China, in a World’s First for a Football League. Now comes the next question for Divi Research, How will this partnership affect the price of $Divi?
Over the last month we have seen the price of $Divi rise 483% from $0.03 to $0.15 based on the rumor of a big partnership. Now that the partnership is known, what should we expect?
Who is La Liga?
From Wikipedia: La Liga is one of the most popular professional sports leagues globally, with an average attendance of 26,933 for league matches in the 2018–19 season. This is the eighth-highest of any domestic professional sports league in the world and the third-highest of any professional association football league in the world, behind the Bundesliga and the Premier League, and above the other two so-called “Big Five” European leagues, Serie A and Ligue 1. La Liga is also the sixth wealthiest professional sports league in the world by revenue, after the NFL, MLB, the NBA, the Premier League, and the NHL.
Here is what we know
According to La Liga numbers, 1 in 10 fans in the MENA region are crypto investors. According to the press release, the partnership will have access to over 1 billion fans. So if the Middle East – North Africa region has 1/10th of the total fan base, and if 1 in 10 of those are already crypto holders, then we will immediately have access to a known 10 million crypto holders who are fans of our partner La Liga.
So on Day 1 (which hasn’t happened yet, this is coming shortly) at least 10 million fans who know how to navigate crypto and buy on exchanges will have a chance to see and buy Divi. If only 1 out of 1000 people actually buy Divi on day one, with an estimated 20,000 total addresses of Divi holders to date, this would bring HUGE BUYING PRESSURE to Divi. If each buyer only buys 1,000 Divi (extremely conservative) at a current total purchase price of $157.06, then the daily volume of Divi will be increased by 10 million Divi. Currently, in the order book on Kucoin, 10 million Divi purchased will catapult the price into the $0.30 range.
And while the above is very conservative, it is just one of the regions, on one of the days. Every match day we get the same chance again. Educating football fans on Crypto and Crypto Made Easy. The network effect of this kind of growth can not be understated. By our calculations, $Divi could easily be trading at $3 by the 10th match where Divi is featured.
How does this change with Fiat Rails?
Fiat Rails is the feature that will allow Divi Wallet users to purchase Divi directly using their bank account or credit card. It aligns with the Divi mission, Crypto Made Easy.
Originally fiat rails were promised in December, but with the activity around La Liga, we believe this date might slip to February 2022. With the simplicity of fiat rails, we believe the onboarding success rate could climb 100 fold. This significantly changes the math, bringing in 1 million new Divi holders each match week. This pace is realistic, in that with roughly 39 match weeks per year, it would take over 25 years to acquire 100% of the fan base. Once the Fiat Rails feature is introduced, we can see $Divi price rising to $5-$15.
The announcement is just the beginning. As of today we don’t expect one single fan has been acquired from this partnership. We believe $0.30 is an early price to get in at, and anything under $0.20 is very early.
Despite the big moves in crypto and more adoption from other industries, the fact still holds that cryptocurrency is highly volatile, and one has to invest with caution. Also, the future of the legal status of crypto is still not certain, and nothing here should be considered financial advice.