BaseMorpheX (BMX)
Investment Memo
AB updates are for informational purposes only. Do not construe any of the following as investment, financial, or other advice. You make your own decisions.
Disclaimer: AB Research is a culmination of research & insights from the diverse capacity of the AB Team. Ultimately our focus & mission is financial freedom. This is a special edition. Whitetail owns BMX. AB Fund owns BMX.
Date: 1/27/25, PM: Whitetail, Investment: BaseMorpheX (BMX)
Investment Type: DeFi, Network/Layer 2: Ethereum / Base
Protocol Synopsis: BMX is a decentralized perpetual trading platform on Base.
Protocol Overview: Originally launched as Morphex on Fantom, BMX innovates on the GMX model by removing escrowed tokens and single-staking (GMX liquidity tokens or GLT) and replacing it with BLT (BMX liquidity token). By creating a wBLT/BMX liquidity pool, BMX removes the need for a wETH or additional liquidity pool. BLT increases capital efficiency by removing competition between trading liquidity (BLT) and native protocol liquidity (wBLT/BMX). The introduction of wBLT as product represents a new innovation as wBLT can have multiple use cases all built on top of auto-compounding BLT rewards: wBLT/BMX pool provides native protocol liquidity, the ability to pair wBLT with (other assets) which benefits protocols through wBLT’s auto-compounding in addition to the underlying BLT assets being an index of blue-chip assets, can be collateralized to allow users to earn autocompounding rewards while borrowing against their wBLT positions but never allowed to borrow wBLT itself. This creates a new asset type that can be used as a liquidity pair across the EVM. BMX offers spot (classic), margin (freestyle), and NFT trading (MediaX), only requiring a wallet connection to use.
BMX Classic: A spot and margin trading platform based on GMX-v1 with a focus on capital efficiency and low fees. All trades are settled against a singular liquidity pool consisting of blue-chip assets, where a user can provide liquidity with any whitelisted asset, and in exchange, they receive LP tokens, representing their share in the diversified liquidity pool.
BMX Freestyle: An intent-based trading platform with a focus on low fees and offering over 250+ trading markets, powered by the SYMMIO protocol.
Based MediaX: An onchain avatar (NFT) and veAERO marketplace on Base with a fee of 1.9%, where listings with multiple avatars use Chainlink VRF to distribute randomly to buyers.
Team: Morphex is a collective of contributors who are anonymous to one another and live all across the world, contributing to the success of Morphex alongside a powerful community. Morphex believes in decentralization, self-custody, and on-chain actions, and never has access to or holds user funds.
Thesis: Holding BMX is the opportunity to acquire a decentralized perpetual exchange with an innovative liquidity model. BMX came onto AB’s radar via meowphasaurus (meow.base.eth / basegods.eth). That account is one of the largest NFT holders / investors on Base. In December 2024, Coinbase Ventures open market twapped 114,395 BMX (~$4.37 per token), making it only their second market buy of a base project (first was AERO). AB believes that CB Ventures market buying a Base native project is an extremely strong signal. wBLT has the potential to evolve into a native liquidity pair across a variety of L2 networks as users might want exposure to a hybrid basket of blue chip tokens instead of having to choose between ETH or stablecoins. Recently, BMX launched wBLT/BNKR as the first non-native wBLT vault listing. BMX recently launched on its second network, Mode, a DeFi focused L2. In addition, BMX is fully diluted with no new tokens being issued.
Tokenomics:
Circulating BMX Supply: 2,764, 230 (100%), Total BMX Supply: 2,764,230
AUM: $16.74M (includes BMX staked on Base + Mode & BLT pool on Base)
BMX Staking Yield: Currently at 5.3% paid daily in ETH with the ability to earn a 100% multiplier based on time staked. There is a proposal being discussed to increase the protocol revenue directed to BMX stakers from ~15% to ~20% (25% increase)
wBLT Yield: 102% (current) / 91.6% (projected next week), BLT Pool AUM: $4.01M
BLT basket (underlying assets):
Token - Weight - Target Weight
Ethereum - 29.4% - 30%
cbBTC - 15.2% - 14%
Aero- 6.5% - 6%
Well - 1.7% - 2%
USDbC - 3.7% - 4%
USDC - 37.5% - 40%
EURC - 4.9% - 4%
Total Volume: $741,739,255, Total Fees: $1,658,354, BLT Pool: $4,075,384
BLT supply: 6,282,702, Total Users: 40,682
AB updates are for informational purposes only. Do not construe any of the following as investment, financial, or other advice. You make your own decisions.