Hivemapper: Wen Burn?

Burn

Hivemapper’s addressable market is in the $10s of billions. As we showed in our previous note, Google Maps Platform alone is a +$10b per year business, and single map data deals can be quite large. 

We provide a scenario analysis where we model out HONEY burn as a function of ARR and HONEY token price. Today, for each dollar that flows into the Hivemapper system to purchase map data from the Hivemapper Foundation, 75% is burned. The remaining HONEY is re-minted to the community as Map Consumption Rewards, up to a limit of 500,000 HONEY per week, with any overages being burned permanently. To identify the threshold for net burn, we simply look at issuance schedules to understand what amount of ARR implies a net burn, where Weekly ARR > Weekly dollar-denominated HONEY issuance yields a net burn. 

Today, at a HONEY price of $0.065, with the new 75% burn policy, Hivemapper needs just over $13m in ARR to ensure that the weekly burn exceeds weekly HONEY issuance to contributors. Putting this number in the context of the broader market for map data, achieving contracts worth just 20bps of Google Maps Platform’s estimated revenue yields $20 million in ARR. 

Capital Efficiency

Additionally, Hivemapper’s HONEY issuance has been extraordinarily capital efficient in terms of issuance relative to circulating market cap and KPIs. Since its inception, the project has emitted just over 360 million of the 4 billion HONEY token supply earmarked to Contributor Rewards (see here). With less than 10% of lifetime rewards distributed, the project has mapped over 25% of the world’s unique road KMs, with the remaining contributor rewards on pace to be exhausted over the next 25 years.