What Is Lumishare Crypto and Is LUMI a Good Investment

Published: April 7, 2024 | Last Updated: April 7, 2024

Markos Koemtzopoulos

Markos Koemtzopoulos is the founder and main writer of ElementalCrypto. He has been a lecturer at the University of Nicosia on cryptocurrencies and DeFi and has taught two courses on crypto and blockchain technology.

In this post, I will explain what LumiShare is and analyze whether LUMI is a good investment based on four investment criteria: team, product, tokenomics, and momentum

What Is Lumishare

What is Lumishare

Lumishare is a real-world asset project that aims to tokenize renewable energy and other assets. This way anyone, from hedge funds and family offices to small-time retail investors has the option to invest in solar and wind farm projects. Lumishare will issue NFTs to represent the fractional investment in these projects.

I say fractional investment because owning the NFT won’t give you ownership of the project. Instead, you get a combination of fixed and variable monthly yields over the NFT’s tenure at the end of which you don’t get any principal back. So it’s something between debt and equity. 

 To purchase the tokenized NFT you will need to buy it with LUMI tokens. 

What is Lumiplace

Lumiplace is Lumishare’s asset-backed NFT marketplace where you will be able to invest in green energy assets. They are still in the testing phase for this product but there is a clever integration that allows you to view the wind farms and solar panels that you are investing in which is cool.

Lumishare’s platform allows retail investors to diversify their portfolios and gain exposure to an asset class such as solar panel technology they might otherwise not be able to. On the flipside renewable energy farms have more accessible funding as more people can invest in their projects. 

The marketplace is still in its infancy as they have only just launched a testnet. 

In the future, they plan to expand to everything under the sun including private credit, precious metals such as physical gold, mining, agriculture, real estate, senior debt, equities, and fine art.

Lumiplace will allow users to see real-time data about renewable energy assets.

The Lumishare team has experience in renewable energy and undertakes due diligence. 

LUMI Token

Like most real-world asset crypto projects the LUMI token is used as a medium of exchange on the platform. 

Why don’t they allow you to use USDT or BTC to invest in tokenized RWA projects? 

Because issuing a token allows them to raise funds.

To make holding the token attractive LUMI holders will be able to do all the usual stuff: 

  • Get early bird access to investment opportunities 
  • Vote on decisions
  • Stake their LUMI on LumiStake which will pull liquidity out of the market.

All good and familiar so far. However where LUMI stands apart is that it is backed by gold, a cash reserve, and what it calls “advanced technology”. I haven’t understood why. Even though LUMI is not a stable coin they also talk of a stabilization algorithm but don’t explain in detail how this will work. They claim this will deliver unlimited upside and limited downside. I am wary of language like that.

Currently, LUMI runs on the Binance Smart Chain but the roadmap includes plans to mint an ERC-20 version for Ethereum and Polygon. 

Token supply 

The maximum supply of tokens is just under 8bn to reflect the population of the earth when Lumi launched in 2022. 

Tokens unlock gradually while 50% of tokens will gradually be burned. 20% will be burned over time every month and the other 30% through an auto-burn process which is yet to be specified by them. 

Token allocation 

  • Presale 0.09%
  • Institutional Investors (VCs) 0.91%
  • Exchange Listings 15%
  • Asset 1 (Gold & Reserves) 10%
  • Asset 2 (Technology-Auto-Burn) 30%
  • Tokens for Burning (linked to calendar period) 20%
  • Donation 4%
  • Staking Mechanism 4%
  • Founders, Partners, Team, Management, Advisors, PrivateInvestors: 10%
  • Development (Community Partnerships, Marketing, R&D + BusinessDevelopment):  5%
  • Wealth fund: 1%

How real-world assets get tokenized

  • Lumishare gives the green light on a project after screening it
  • They set up a special purpose vehicle (SPV) to securitize the project
  • The SPV tokenizes its shares and places them in a smart contract
  • The sale is registered to comply with the local regulation
  • Investors are invited to subscribe to the offering that includes details of the deal
  • Once a minimum threshold of investors is reached the smart contract mints the tokens and sends them to their wallets while investor funds are sent to the project’s wallet. 
  • The tokens are immediately available to trade on LumiPlace
  • Any interest, dividends, and revenue are delivered through LumiPlace. 

Is LumiShare a good investment?

Team

1. Are the founders legit with related experience?     ✔️    

The CEO has a background in entrepreneurship and IT. The CFO has 36 years of advising start-ups on their growth. They have poached the Global Head of Credit Strategy & Global Head of Macroeconomic Strategy at BlackRock as VP. Their devs have experience in Web 3 and the key members of the team have experience in renewable energy. Overall the team is of high caliber with experience at  J.P. Morgan, Blackrock, Goldman Sachs, Dubai Gold Exchange, DE Shaw, Credit Suisse, Oxford University, AAVE, and more. What I am missing is someone who will take of the legal and compliance bottlenecks for them. Check out the team here.

2. Have they built Web 3 projects before?    ✔️

Yes

3. Did they do an exit?    ✔️    

Some of them have yes

4. Can you find legit profiles on LinkedIn?    ✔️    

Yes

5. Did they raise funds?    ✔️    

Raised $3.2 million led by the private office of his highness Sheikh Mohammed bin Ahmed bin Hamdan a member of the royal family of Abu Dhabi.

6. How long have they been around?    ✔️    

Since 2021

7. Public appearances through Interviews/podcasts    ✔️    

Yes they do AMAs and podcasts/interviews

Overall team score        100%

Product

1. Is it easy to understand what they do?     ✔️    

Yes

2. What is it?    –  

Tokenize real-world assets starting with renewable energy projects

3. Is there a demand for their product?     ✔️    

It remains to be seen but everyone assumes that there is going to be demand for any type of tokenized real world assets.

4. Is there a use case?    ✔️    

Yes make it easy to buy a fraction of a renewable energy project or other assets

5. How big is the market?    ✔️    

In the trillions

6. Is it being used?     ❌    

No, they are just about to launch a testnet

7. Github activity    –    

N/A

8. Has the product launched?    ❌    

Not yet, it’s still being developed

9. Does it have a strategic moat?     ❌    

No

10. Is it focused?    ❌    

No, they are talking about augmented reality, voice Chat GPT smart assistant using AI & machine learning, and full metaverse capabilities.

11. Is the website easy to understand for non-crypto visitors?    ✔️    

Yes, though they add a lot of faff such as Lumishare’s commitment to clean energy and helping with the UN SDG goal for the world to generate power through renewables etc. The best resource is their whitepaper which is also a little wordy. They do not explain what blockchain they will issue the tokens on.

12. Do they have a proof of concept?    ✔️   

 Yes, you can see the alpha version of the LumiPlace platform here plus 3 companies have signed up to tokenize their assets. The marketplace will allow investors to view the project they want to invest in and then connect their crypto wallets and convert their digital assets to LUMI to invest.

13. Is the UX good?     ✔️    

The LumiPlace proof of concept looks decent enough

14. Is it already being done?     –    

Yes, there are loads of RWA blockchain projects. I haven’t seen anyone else tackle renewable energy investments

15. At what stage is the product?     –    

Testnet launch

16. How does it create value?     –    

Retail Investors can invest in renewables. Projects can raise funds easier. The world uses more clean energy.

17. How does the project generate revenue?    –    

You pay fees in LUMI tokens. 

Overall product score        65%

Tokenomics

1. Why is the coin valuable?    ✔️    

The LUMI token is used as a payment method. You need it to buy stuff and to pay fees. You can also stake it and get special privileges/rewards

2. Did they do a pre-mine?    –    

Yes, 0.09% of tokens were distributed during a pre-sale which raised $2.8mn at 15 cents per token.

3. Is supply fixed or inflationary?    –    

Fixed at just under 8bn

4. Was it a fair launch    –    

No there was a presale

5. Circulating/total supply    ❌    

0.5%

6. Token release schedule    ✔️    

The 10% that is allocated to investors and team will be released gradually over 5 years with 10% unlocked by year 2, 30% by year 3, 30% by year 4, 30% by year 5

7. Are there incentives to reduce or lock supply?    ✔️    

Yes, there is a staking incentive

8. How many tokens    ✔️    

LUMI only

9. How much upside is left: market cap vs industry size    ✔️    

$4Mn vs many trillions

10. Is it listed on major crypto exchanges    –    

No, it is only available on MEXC, LATOKEN, and PancakeSwap but they hope to list on more cryptocurrency exchanges in the near future.

Overall tokenomics score        80%

Momentum

1. Is it trending on social media?    ✔️    

Yes, Lunarcrush shows that Lumishare is getting many interactions. They have a vibrant community on X.com with 55K followers. Compare this against the top trending RWAs such as ONDO (178K), RIO(85K), and PROPS(116K) and it’s not bad for a lesser-known project. If social media domination picks up it’s definitely a good sign.

Lumishare Lunarcrush
Lumishare on Lunarcrush

2. Is the market cap low compared to similar projects?    ✔️    

One of the lowest at $4Mn

3. What is the crypto market like?     ✔️    

In the middle of a bull run

4. What is the sentiment for the sector this crypto focuses on    ✔️    

RWAs are hot.

5. Are they marketing heavily?    –    

No

Overall momentum score        90%

Bottom line

Causes to be bullish

The team is good and we are starting from a very low market cap.  The fact that they have raised funds from H.H Sheikh Mohamed Bin Ahmed Bin Hamdan Al Nahyan is not to be overlooked. 

The renewable energy angle is unique as it allows investors to invest in uncorrelated assets with crypto or stocks. If the project succeeds you are looking at 100x minimum.

Reason to be wary

However, the biggest challenge to all this taking off is compliance. I don’t know if LumiShare has all the requisite licenses to custody crypto, tokenize all the stuff they want to do, KYC customers, and comply with government regulations. These are key to the long-term success of the company.

I am also concerned about their big talk about using Augmented Reality, AI, and a Metaverse which I fear will distract them from focusing on execution.

Also they don’t give much information about which chain they plan to tokenize assets on. Is their own chain with their own validator set? Is it one of the main blockchains? Not clear.

I’ll be watching them closely to see how they evolve. 

Please take care of yourselves and do your own research. None of this is financial advice. 

References

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Markos Koemtzopoulos is the founder and main writer of ElementalCrypto. He has been a lecturer at the University of Nicosia on cryptocurrencies and DeFi and has taught two courses on crypto and blockchain technology.

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