This report explains the methodology, assumptions, and results of the Internal Rate of Return (IRR) analysis for the proposed Nickelium crypto project. The project derives token value from nickel spot prices on the London Metal Exchange (LME), applying the Golden Formula. The IRR calculation assesses the financial viability of the project over the horizon 2026–2028, given a defined initial investment and modeled inflows.
1. The Golden Formula
The Nickelium token (NCL) value is determined by:
NCL = [Ni + max(10000, (Ni – No)^φ)] / 10000
Where:
• Ni = Daily LME Nickel price per ton (USD)
• No = 25-year low price of nickel, currently fixed at 15,000 USD/ton (Jan 2, 2025)
• φ = 1.618 (Golden Ratio)
• The divisor 10,000 tokenizes the per-ton value into the crypto unit (NCL)
This formula ensures a floor of 10,000 in the numerator and a convex upside as Ni rises above No.
2. Market Data & Assumptions
Baseline nickel spot (Q4 2025): 15,300 USD/ton.
Forward curve modeled with moderate growth:
Year Market Assumption % Growth Ni (USD/ton)
2026 Moderate recovery 4.5% 15,988.5
2027 EV rebound 5.0% 16,787.9
2028 Full recovery/inflation 6.0% 17,795.2
3. Golden Formula Application
Using No = 15,000 and φ = 1.618, the token values (NCL) are computed as follows:
Year Ni (USD/ton) NCL (USD/token)
2026 15,988.5 8.61
2027 16,787.9 19.97
2028 17,795.2 39.48
4. Cash Flow Structure & IRR Calculation
Cash flow assumptions:
• CF0 = –2.5 (initial investment)
• CF1 = +8.61 (2026)
• CF2 = +19.97 (2027)
• CF3 = +39.48 (2028)
Cash Flow Series: [–2.5, 8.61, 19.97, 39.48]
IRR is the discount rate r that sets NPV = 0:
NPV = Σ [CFt / (1 + r)^t]
Result: IRR ≈ 444.5% per year.
5. Interpretation
The IRR result of ~444.5% annually suggests extraordinary profitability, driven by the leverage
effect of the Golden Formula. Even modest growth in nickel prices results in exponential increases
in NCL values due to the φ = 1.618 exponent.
Key sensitivities:
• Issuance scale: higher token sales amplify inflows relative to fixed CF0.
• Market volatility: nickel price drops can sharply reduce NCL.
• Operational costs: fees and expenses not yet included.
This IRR should be viewed as a theoretical best-case under modeled conditions.
6. Conclusion
Under the modeled assumptions, the Nickelium project demonstrates an Internal Rate of Return
(IRR) of approximately 444.5% per annum. This highlights the substantial upside potential of linking
token value to a commodity through the Golden Formula. Nevertheless, this outcome is highly
sensitive to nickel price volatility, issuance scale, and operational execution.