I ran a few analytics on the social experiment: Shuffle Token

Timo
Timo
Nov 5, 2019 · 13 min read
Shuffle Token — First deflationary Token introducing the ‘Heap’

Disclaimer: This token has no real-world use case. It is not meant to ever be a serious currency. It is simply a social experiment, for researching how a deflationary token with a “Heap” structure works and behaves under different conditions/trends!

Shuffle token has been around for over 3 months now and I’ve been following it closely since shortly after the launch. The ‘Heap’ component of Shuffle brings a lot more interesting dynamics to consider when deciding whether to grab a bag of it, than with other token-models like for example, the most renowned deflationary token BOMB.

For the people that don’t know what SHUF is, check this quick summary:

Shuffle is a basic ERC20 token with additional functionality. On each transfer of SHUF token, two things happen:

1% of the transferred value goes to a randomly picked address of the top 512 holders, creating a hybrid of a never-ending lottery ticket and a stacking mechanism.

1% of the tokens are burned (destroyed forever), decreasing the circulating supply and thus increasing the value of the remaining tokens, rewarding all the qualifying token holders equally.

The most distinctive characteristic of Shuffle Monster is the 1% transaction shuffle. On each transaction, 1% of the transferred SHUF is rerouted to a random SHUF holder, within a limited pool containing only the top 512 holders.

One of the first unusual behaviors to emerge was users splitting their token stack into multiple wallets. This may be a wise move, given that there is an equal chance of receiving a reward regardless of whether an address holds 50000 SHUF or 1000 SHUF (so long as it is in the top 512 SHUF wallets). This redistribution encourages transactions, and therefore generates more token burn, and more rewards for “the Heap”.

This wallet splitting behavior also leads to the next unique tokenomic phenomenon, Heap Wars. Each time a user deposits enough SHUF into a new wallet, they “kick out” another SHUF wallet from “the Heap”. This constant competition in the heap forces holders to keep moving and adding to their stack, in order to maximize their spots on “the Heap”. This encourages further burning and reward distribution.

It has the basic features of a deflationary token along with the additional component of the Heap, which distinguishes it from BOMB and its clones. You might not understand it at the first glance. The key takeaways and reason this mechanic is so interesting, are:

  1. A 1% redistribution of any transaction happens to transfer SHUF to a single wallet inside the Heap, which is chosen randomly. It’s not evenly distributed or proportionally distributed to the top holders, like with PoS coins.
  2. The practical ROI is highest at exactly the top 512th position. So you would need a specific amount of SHUF to be at this position. But the amount to be exactly 512th holder changes over time, quickly due to what the SHUF community has termed the “Heap Wars”, which is a kind of a King-of-the-Hill game mode for maintaining your position in a specified area.

As someone who put a few ETH into Shuffle to test these mechanics out and observe and analyze what I saw, I also want to position myself as best as I can for maximum profit. My goal is to get as many Heap spots as possible, for the cheapest price as possible and make an educated guess as to what level the minimum Heap level could rise in the short and mid-term in order to determine the amount of SHUF I will hold per Heap spot in the longer timeframe. This is so that I don’t need to rearrange my wallets too often and lose more SHUF in this process.

But wait, does the Heap even do and change anything? Let’s look at the numbers:

One of the most important metrics with SHUF is the burning of tokens over time. As every transaction also sends 1% of that value to the burn address, the supply has been decreasing over time and would, with demand remaining constant, increase the price per token. From looking at the burn rate you can clearly tell the level of usage/activity of Shuffle pretty well. If you were to ignore the initial spike, which was from the initial distribution process to the people claiming their SHUF as well as the founder putting a few thousand SHUF up for liquidity on decentralized exchange Uniswap, the numbers are showing an ongoing, stable amount of SHUF getting burned over time. There is neither a phase with zero activity nor are there any extreme spikes. The usage is surprisingly constant.

I will compare a few metrics to the closest contender of SHUF, which is its predecessor, BOMB. Since the supply of the tokens was the same, to begin with, and both have the exact same burn rate, the comparison should be more than fair.
Looking at the burn BOMB experienced at a similar market cap and phase of the run shows a stark difference:

This time, ignoring the spikes on the right, since this was around the bubbly/peak phase for BOMB, with a much higher market cap than Shuffle has at the moment (about x10 more). On Average, the numbers are lower than for Shuffle. Only the 5 sharp spikes reach a bit higher than what Shuffle did. Most time in between, the burn is pretty low. Let's overlay these charts with weekly rates instead, for a better comparison:

The data clearly shows that on average, the amount of burn is higher for Shuffle than for BOMB, and therefore usage and activity at almost the same time of existence. You might ask yourself why I am comparing this for a different time for both tokens and that it’s unfair. Well, I compare the burn for a time, where the market cap was about the same and the runup is pretty equal. The time where BOMB had the rise from a few cents to a 1 dollar, and for SHUF, from a few cents to (only) 50 cents. This chart actually even would be unfair for Shuffle, since the market cap of BOMB was already double the size of Shuffles. Because there is no older data than 3 months available for Shuffle, I had to work with this. So the numbers would look even better for SHUF if I could apply this for a time with exact same market caps.

Here you see that it has a good, steady climb of burned tokens. No longer phase without any burn and no sharp spikes again. The reason for this, in my opinion, is the constant war for the Heap, which BOMB didn’t have.

Now before I go with the other interesting metrics from the Heap mechanic, I want to show you how similar the runup of SHUF is to BOMB, via the USD charts. These two charts are from Benjamin Cowen, an analyst who also did a few very interesting in-depth analyses:

On the left, the SHUF and BOMB price on a logarithmic chart with the 50 day MA. On the right, both tokens with their prices, but with the %-burned as x-axis

Both tokens started with tiny market caps and had two strong breakouts first, both above the 50-day MA. BOMB did another x10 afterward. Shuffle has yet to make another move. Comparing BOMB’s Bullrun from March this year on a full-sized chart, with the same time-span for both tokens and a logarithmic price scale, this is what it looks like:

If we were to follow the steps of what BOMB did, we would look at an x10 from here. The peak value would be 2–3$ per token.

Here is the price of SHUF in USD over the last 3 months alone with no overlay:

Shuffle in USD over the last 3 months

Starting at about 3 cents, going to about 30 cents, with a peak of 44 cents. After both peaks, it had a healthy 50% correction. One of the best performing tokens in the crypto space right now and no one really noticed.

Now, let's get to the interesting part, the Heap Analytics! Reminder, the Heap is basically a pool of the top 512 holder, which receives 1% redistributions randomly to one of the wallets in the Heap. To plan and calculate your moves, you should take a look at the current minimum amount of Shuffle you need to be in the Heap. For this, I tracked the amount of Shuffle the 512th holder had in his wallets, over the last 3 months:

You can see an initial spike in mid-august, people started to split up their wallets for the first time. Then, stabilized at 500, it started climbing pretty constant and independent from price action. There is no specific timing for people to split up their wallets. It doesn’t seem to be the volume or price development. Maybe it’s the constant rising 512th heap position itself that pushes people to rearrange their wallets and with that again, push other people out. I couldn’t find any other direct relation.

Price per Heap Spot (Amount of SHUF for Spot 512 * current price of SHUF)

Looking at the 512th Heap spot and calculating the total cost of this position in USD over time gives you a pretty steep rising chart. Since both numbers were going up nicely over the course of these past 3 months, anyone owning a Heap position made some pretty huge gains. The price started from almost zero of course, as seen in the very left of the chart, which was the first distribution of tokens to whoever claimed their amount. Together with a tiny price of 2 cents in the beginning and a 512th Heap amount of sub 100 Shuffle, the percentage-wise rise is pretty extreme. What is also interesting is that while we were in the first price consolidation starting on 2nd September, after a correction of -50%, the price per Heap spot only went sideways, which means there hasn’t been a break in people rearranging SHUF across their wallets, even when the price was crashing down 50%. This proves again that the Heap is creating a constant activity that is mostly independent of the price.

Now for one of the most interesting data visualizations I have made in terms of how to position yourself for the Heap Wars — The fight for the last spot in the Heap, for having the highest ROI. I have made 6 snapshots of wallet holdings between 50 SHUF and 2000 SHUF, each being one week apart. The short video I’ve made below shows the movement and includes the 512th Heap amount as shown by the small blue arrow at the bottom:

The wallets started to converge on 1000 SHUF for the latest snapshot, and before that, we had pretty well-distributed wallet amounts, aside from the peak at 1500 SHUF per wallet, which was the maximum amount of SHUF you could get by claiming your free airdrop.

Knowing at what amount of SHUF most wallets are maintaining at any time can help find the perfect level/amount of SHUF to buy or rearrange your wallets to. For example, looking at the current Heap 512th at 810 SHUF and the median of the range being at 1000 SHUF now, would make me want to split my wallets to about 1100 SHUF each. You still get a relatively cheap Heap position at that level which will stay in the Heap a lot longer than if you were to go with 900 SHUF per wallet. When talking about ROI, you shouldn’t forget that if you get kicked out of the Heap with your wallet and have to replenish it in order to re-enter the Heap, you would need to eat another 2% ‘fee’ for doing so, which may counteract any rewards that were previously obtained.

Most people seemingly didn’t decide the ideal amount to go with based on this heatmap, but instead by a psychologically reassuring number, 1000.

Okay, lets really talk about ROI here. I took the time and calculated the exact ROI in percent you would have over 30 days of holding a Heap Position, with every single day in the last 3 months as (30-day period-)ending point:

ROI for holding a Heap Position over 30 days

As you can see, that the ROI has swung from a minimum of 2.2% to around 6%, followed by a spike to 8.2%. Now the ROI has been determined only from the rewards obtained from being in the Heap for the time specified, without factoring in the price increase. These are monthly rewards of 2.2–6%, solely thanks to the 1% redistribution feature of SHUF.

I have also remade the same chart with the price increase included. This shows the total ROI of buying a top 512 Heap position, holding it for 30 days and collecting the rewards from the redistribution/shuffle (I used the average rewards for calculating this).

These numbers look a lot more impressive now thanks to this chart. The ROI basically ranging from about +140% to 350%, with only a handful of days dipping below or peaking above this range. The absolute peak ROI would have been made by buying a Heap position on the 11th of September and holding it for 30 days. That would have given you a whopping +530%. Congrats! Of course, this is highly dependent on the price rise.

Average Monthly ROI for 512th Heap Spot including price rise

There are also some nice summaries about the Heap and the rewards which are available on the Shuffle Monster Telegram, they look like this:

Shuffle Telegram Bot showing stats about the Heap and Rewards

I would also like to state that I had once held a position in BOMB, but have since flipped completely to SHUF months ago when BOMB started dropping in price. It would, therefore, be essential for me to know how I have performed when compared to BOMB. This is the SHUF/BOMB ratio over the last 3 months:

SHUF/BOMB ratio

It shows impressive gains of about x100. Switching BOMB to SHUF 3 months ago would have made your position perform x100 better. That is, you would have gone from 0.006 BOMB per SHUF to almost 0.5 BOMB per SHUF.

Volume of SHUF on Uniswap

Checking the volume of SHUFFLE on Uniswap would show you that it’s maintained a consistently high position in the volume rankings. Shuffle is permanently a top 15 or top 10 traded token on Uniswap, even though it’s still highly unknown.

Uniswap itself became one of the top 6 most used DeFi applications over the last year:

Conclusion

It is verifiable that the Heap component of Shuffle gives it a higher activity/burn rate and stability than from solely having a deflationary component. With the same market cap and ‘users’, the burn rate is significantly higher for Shuffle than it is for BOMB and other deflationary tokens. Therefore, with a stable or rising demand/popularity, you will see greater returns on SHUF than on BOMB, even excluding the Heap rewards.

Now the big question is how Shuffle and the Heap behave in the future, with rising usage, prices, and rewards.

How high will the Heap rise? How fast will it rise? How will it behave on a longer-term correction? And the most important question — Will the Heap continue to keep its activity up, no matter what the price is doing over a longer-term correction, or will it die off at some point, as other projects before it have done?

My speculative thoughts on Shuffle’s short and midterm performance are that the run is not even close of being over yet and the cycles for Shuffle could be a lot more stable/smoother than those of its contender BOMB, simply based on the growth and similarities it has with BOMB, judging by the better burn rates, more stable price rises, and the provable success of the Heap War mechanic. But the biggest point for me to check whether a run is over or has yet to start would be the activity and awareness on Twitter and Reddit about it. BOMB, for example, had dozens of videos popping up and hundreds of tweets about it when the peak level was close. For Shuffle, I have barely seen anyone tweeting or posting on Reddit about it. There has been almost zero discussion about it on the go-to platforms when it comes to ERC-20 tokens, like r/ethtrader and r/ethfinance. Even the telegram group doesn’t even have 1/10 the member count of what BOMB had. This tells me that another big breakout and real runup is still yet to come.

For more on price speculation, with more educated guesses, check out Ben’s video:

If you want to know more about Shuffle and get in touch with the community, join the Shuffle Telegram:

https://t.me/shuftoken

I will make a follow-up post about the fundamental side of Shuffle, who made it, how the distribution exactly went through and what the code actually does. For now, I’m gonna continue to hold onto my Shuffle position until we see it going well into the third big leg-up, to 2–3$

For more statistics on price and volume, check Coingecko:
https://www.coingecko.com/en/coins/shuffle-monster#panel

If you are interested and want to gamble a few bucks on Shuffle, you can buy it here on Uniswap. Just be aware, that investing in this social experiment is highly risky and can result in losing your money:

https://uniswap.exchange/swap/0x3a9fff453d50d4ac52a6890647b823379ba36b9e

All data is from Bloxy.info and CoinGecko.com

In case anyone is interested, I can share all my raw data and calculations for the charts per mail. Just hit me up.

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