The bull market is underway, and we are headed into the thrill phase, where almost everything pumps.

With Bitcoin scratching a new all-time high, multiple altcoins will start trending up. And while some older coins will finally have a chance to deliver on their promise during this bull run, hey, don’t ignore the shiny new coins.

The attention is currently focused on memecoins and AI, but that doesn’t mean you should ignore opportunities in other sectors.

Let’s talk about the privacy sector - on the surface, it sounds boring, but one of the shiny new coins in this sector has recently pulled a massive 30x.

While it might seem like the opportunity has passed, this project still has a market cap of less than $10 million.

This is one of those high-risk bets that may deliver big wins over the next 12-18 months. 

Sounds interesting?

Let’s dive in!

TDLR

• Today, we evaluate the opportunity in a small-cap project in the privacy sector that has recently seen a 30x price surge.
• The project facilitates private crypto swaps and cross-chain bridging.
• It has a novel tokenomics model where 20% of revenues are distributed to token holders.
• Despite being under-the-radar, the exchange has generated over $1.2 million in revenues in just six months.
• There could be a 20x upside in this coin if privacy becomes a major narrative in the 2024/25  bull market.

Disclaimer: This is not financial or investment advice. You are responsible for any capital-related decisions you make, and only you are accountable for the results. “One Glance” by Cryptonary sometimes uses the RR trading tool to help you quickly understand our analysis. These are not signals, and they are not financial advice.

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Introducing Veil Exchange

The Veil Exchange is a privacy-focused exchange allowing users to anonymously swap different coins. 

It is not a decentralised exchange in that sense of the word.

A key focus of Veil Exchange is providing privacy and anonymity - it does not require any sign-ups or personal information, users can exchange unlimited amounts, and transactions are obfuscated by receiving swapped cryptocurrencies in a separate wallet from the sending wallet. 

Veil Exchange aims to act as a private and secure bridge for seamlessly exchanging digital assets while protecting user identities and transaction details. It currently supports more than 100 coins and constantly adds support for new assets. 

The key functionalities offered by Veil are listed below:

• Cryptocurrency swaps

The platform users can process direct swaps between assets like Bitcoin, Ethereum Solana, and other supported networks at low fees. 

• Cross-network bridging

Users can swap between different networks, incorporating interoperability with the blockchain ecosystem. This bridge functionality is valuable for users seeking to diversify their holdings.

• Privacy

As mentioned earlier, Veil’s working principle is based on private and safe transactions. The assets are received in a separate wallet from which they are sent, and the source address remains untraceable as well. Swaps can’t be tracked. 

To enhance its privacy feature, Veil has also introduced ETH Mixing with Delay. It allows users to mix their ETH transactions, which improves the privacy aspect of the trade. The feature utilises a router/wallet system, which ranges from 0.1 ETH, 0.5 ETH, and 1 ETH to the 5TH option. A detailed description is mentioned on their whitepaper. 

Veil's tokenomics

The Veil Exchange uses VEIL as its utility token. 

The token is designed to support the ecosystem and has ideal value accrual properties. 

The total supply at TGE was 1,000,000,000 tokens.  

VEIL is included in the circulating supply, distribution, fees and initial liquidity. 

80,000,000 tokens have been vested for a year in order to maintain stability and commitment to the development. 

The project currently has 4,710 token holders, with total transactions processed clocking at 32,741. It is important to note that the platform has only been active since September 2023. 

23% of the circulating supply is held by the MEXC exchange and on the Uniswap V2 contract, which means these entities are not likely to dump on the market. No individual large addresses hold more than 2% of the total supply. 

There are no token unlocks, unlimited circulating supply, or early investor allocations. The tokenomics are pretty transparent. 

Fee structure

The fee structure might appear to be a downside at first glance. 

VEIL has a token tax of 5% on both buying and selling. Thus, each transaction incurs 10% in tax fees for the ecosystem. 

However, the revenue generated is utilised across multiple categories, and VEIL token holders also receive a share of the fees. The revenue generated is allocated in the table below.

As identified in the illustration, the proceeds are used to improve the platform's liquidity so traders have enough depth and stability. A part of it is used to continuously improve the security and user experience. Proceeds are dedicated to marketing and partnerships, and token holders are rewarded for participation and loyalty. 

How do we value VEIL?

One of the things that we appreciate the most about the VEIL platform is its simplicity.

We understand that privacy protocols run on hardcore cryptography and sophisticated algorithms. But in reality, the simplicity of the UI/UX will be a crucial factor in adoption – and the VEIL Exchange has this locked down. 

Using Veil is easy. You select the coin you want to send and the coin you want to receive and input a recipient wallet. Veil generates a deposit address, and you deposit the coins; you receive the target coins in the wallet you provided – easy peasy. There are no signups or need to connect your wallet – it is a straightforward service of bridging and swapping digital assets. 

Although this isn’t a unique solution, it is a simple one that works. For privacy-conscious users, VEIL is one of the easiest solutions out there. 

An important point to note, however, is that privacy is not yet a trending narrative. AI and memecoins have all the attention for now. However, one of the core selling points of all crypto is privacy and pseudonymity. Historically, there is evidence that privacy is a huge crypto sector, and as this bull run progresses, the privacy narrative will pick up steam again. 

Let us take the example of Tornado Cash.  

Back in 2021, Tornado Cash was being used extensively in the market. It was a mixer that decoupled the sender and recipient of digital assets to protect user privacy in a public blockchain network. 

In October 2021, Tornado Cash had a total value locked or TVL of over $1 billion. During its peak utilisation, Tornado Cash moved close to $2.8 billion in volumes. However, in August 2022, the U.S. Treasury Department’s Office of Foreign Asset Control (OFAC) sanctioned Tornado Cash, which led to a decline of 85% of overall volumes throughout late 2022 and 2023. 

While the sanctions did slow down Tornado Cash’s capacity, this doesn’t hide the fact that privacy transactions were significantly processed. While illicit actors like the Lazarus Group using Tornado Cash led to the sanctions, this doesn’t diminish Tornado Cash as an efficient privacy tool. 

Now, after a period of stagnancy, privacy projects might be witnessing a resurgence again. 

Tornado Cash is witnessing a peak in usage over the past few months. Since October 2023, Tornado Cash TVL has improved from $220 million to over $550 million at the moment. Alongside, other privacy protocols are also growing in TVL, indicating that there is some form of renewed interest in the privacy sector. 

And this sign of life in the privacy sector is why Veil is on our radar. And more importantly, a resurgence of the privacy narrative will play a key role in VEIL’s future market valuation. 

So, if you want to take a position in VEIL, your investment should be underpinned by your conviction on the potential of privacy protocols to make a comeback during a bull run.

Valuation targets

VEIL has decent on-chain fundamentals for a project that is relatively under the radar at the moment. 

For example, the platform has generated significant revenue over the past six months. 

Since September, the platform has paid $246,000 in revenue to its token holders. Considering that 20% of the total revenue is distributed to VEIL holders, the total revenue generated over the course of six months is around $1.23 million. This brings its annualised fee to around $2.46 million. That is a decent amount of business for a project valued at around $10 million. 

From a sentiment perspective, VEIL has also started to gain social attention. 

Over the past thirty days, it has gained 2,411 followers on Twitter, increasing to 5,413. CT is beginning to take notice, but it is important to note that it coincides with its 30x rally so that it might have played a role in renewed interest. 

The token is yet to be listed on any major CEX and it is currently limited to only MEXC exchange and Uniswap. 

Token holders have incentives to hold the asset with a payout which takes place every 72 hours, and the revenue collection is distributed across the board. 

(It is important to note that token holders need to hold a minimum amount of 1 million VEIL to be eligible for payouts.)

The numbers

Let us summarise the facts. 

The current market cap of VEIL is $9.2 million. 

The platform is on track to generate a projected annualised revenue of over $2 million, and the crypto market is yet to start paying attention to it.

The token is worth below $0.01, and if privacy picks up as a narrative over the next few months yet again, the protocol will become an ideal go-to platform. As mentioned above, the token is designed to thrive as the exchange picks up adoption and growth. 

Therefore:

• In the base case, a market cap of $50 million is reasonable, i.e. 5.4x from the current price point. 
• As a bull case, our peak bull market cap is $100-$150 million, giving us an 11x-15x upside. 

However, if you find the ideal entry price based on the technical analysis below, you could be positioned for a 20x on this token.

It is important to note that we are assuming that privacy protocols pick up steam in the next few months.

If the privacy narrative doesn't regain popularity within a few months, the thesis will be invalidated, and Veil will continue to range at its current level.

Technical analysis

The VEIL token registered a massive 3064%, or a 30x rally, between February 17 and March 4. The token peaked at $0.0148 when its market cap was around $14.8 million. 

The price is undergoing correction at the moment; hence, investors can start to build a position and DCA into levels between $0.005 and $0.003. 

A position around $0.005 allows investors to potentially aim at 20x returns on its targeted market cap of $100m—$150m. 

However, we want to emphasise the point that VEIL is a high-risk opportunity, so allocation should be less than 2-3% of one’s portfolio until we have more data proving that VEIL is on the progressive path. 

How to buy VEIL

VEIL is an ERC-20 token and is currently available on MEXC and Uniswap.

Cryptonary’s take

The long-term potential of VEIL largely depends on the interest in privacy transactions. With the recent fallout of CEXs across the industry, privacy should remain a need for some in the industry. 

Over the past few weeks, VEIL has witnessed a 30x growth already, and the platform has significant users. So these early signs are promising, and considering we are entering a bull market, there should be more upside for the token. 

These token opportunities come with a high-risk element, and VEIL is the same. It has not garnered much market attention yet, but at the core of the protocol, there is a strong product.

With VEIL, the market is still early, as the token hasn’t gotten any market traction yet. Considering that most of the market is taking high-risk bets on meme coins, VEIL presents an alpha with the same potential, but it is backed with a USP and on-chain fundamentals. 

VEIL has our attention going forward, but patience will be key with this alpha. Until then, Cryptonary out!