Economics of owning an Urbit Star

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Here's how I see the economics of the Urbit ecosystem. You have three types of assets: Planets, Stars, and Galaxies.

Planets

A planet is a permanent identity on the Urbit network. Purchasing a planet is kind of like purchasing a static IP address. It's yours, forever. You can store whatever you want in it, and you can run whatever apps you want. So, the question is, what is a planet worth?

Over the last couple of years, it seems that a planet is worth a pretty fixed amount of money. For a long while planets were selling for about $20, but since gas prices are high that price has turned out to be $20 plus gas fee, which ends up doubling the price. So we have long-term evidence that planets are worth between $20 and $50, and that's at the current level of functionality (beta).

I believe that planets will always sell for at least $20. If a full permanent identity on the Urbit network isn't worth $20 for you, you're not really interested anyway. And for most people $20 is an incidental expense. It's four Starbucks coffees.

Stars

Stars are the vehicle to invest in the Urbit network. A star is a bundle of 65,000 planets, with the added bonus that star owners will have some control over their child planets. So, the value of a star is the value of all the planets plus the value of the star privileges.

If we assume that the floor price for a planet is $20, then the ultimate value of a star if you sell all 65,000 addresses is $1.3M. Well, that's a big if, but that's a very realistic best case scenario.

Today star prices are approaching $20000. So what is the downside risk? Well, it's not really 100%, because you're basically guaranteed to be able to sell a few planets to someone. Your breakeven point is 1000 planets. If you sell 1000 planets at $20 apiece, you break even. And that's not counting that you can sell the star itself for something even if all of the planets are gone...$3000? And that's also discounting any appreciation.

Galaxies

A galaxy is a bundle of 256 stars, so roughly valuing a galaxy on the top end is just multiplying star value times 256, plus privileges. Galaxies get to vote on what happens to the network.  Galaxy owners get 1/256 of that vote.  There's really no math here. There's no market for galaxies either. I have a galaxy available for sale at the right price. Contact me if you're interested.

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About the author

Jeremy Tunnell
I study Integral Theory and Zen Buddhism at Integral Zen.

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You can reach Jeremy at [email protected]