Before the weekend, I wrote about [the $LSTR token](https://ecency.com/category/@michael561/looking-at-usdlstr-the-latest), from LeoStrategy. I had a lot of questions about the mechanics of the project, that left me wondering, essentially: "Is it a $LEO buyback program, to support that tokens value?"

I received more engagement than I expected from the community, and even got [a reply](https://ecency.com/hive-167922/@leostrategy/re-michael561-33tbzyuxf) from the project themselves.

It’s great to see the project engaging with questions from the community, but I think there are still significant gaps that need addressing—especially for those of us trying to understand $LSTR as a serious investment opportunity.

Pointing readers to scattered blogs and threads to “find answers” feels inappropriate, especially when engagement with those posts directly benefits your revenue model. If $LSTR is meant to be a credible and sustainable project, it needs a consolidated document or prospectus that clearly explains its mechanics, risks, and roadmap. Expecting the community to piece together key details undermines confidence and creates unnecessary barriers for serious investors. A central document would also prevent confusion and distrust.

I still have quite a few questions and concerns.

## Loan Servicing

One of the biggest unresolved questions is around servicing the loans that $LSTR plans to take. You’ve repeatedly said that $LSTR will “never sell $LEO,” and that posting and curation revenue will be used to buy more $LEO. Where do the funds that will service the loan come from?

## "IRL Investors"

Your strategy to collateralize staked $LEO for loans introduces significant risk, particularly if $LEO liquidity tightens. Who are these “IRL investors” providing loans?  Are they internal to Hive, and if so, how does this impact decentralization and influence within the ecosystem? Are there safeguards - such as debt-to-asset ratio limits - to prevent over-leveraging? Additionally, Hive participants are part of the same real-world economy as these investors. Dismissing community contributions as ‘unreal’ signals a troubling bias and raises concerns about how equitably the project values its stakeholders.

## Revenue Streams Feel Insufficient

Given that all revenue is earmarked for buying more $LEO, what’s the fallback mechanism if staking rewards, posting income, or external buy-in declines? It feels like this strategy depends entirely on continuous upward momentum for $LEO. If $LEO’s price stagnates or staking rewards decrease, will $LSTR rely on additional loans or external buy-in to sustain operations? Without diversification or alternative revenue strategies, this creates fragility. What happens if that momentum slows?

## No Direct Benefits for $LSTR Holders

Without dividends, redemption options, or a proportional claim on the underlying assets, $LSTR holders are left relying solely on speculative price appreciation of the $LSTR token. How does $LSTR offer unique value beyond functioning as a buyback tool for $LEO?

## Comparison to MicroStrategy

MicroStrategy’s BTC strategy is flexible because it leverages diversified financial tools, whereas $LSTR appears more rigid. MicroStrategy’s BTC holdings are backed by flexible, regulated financial mechanisms. They can issue equity, sell BTC, or diversify assets to manage debt. By contrast, $LSTR has locked itself into rigid promises (e.g., “never sell”) and relies solely on one asset. This rigidity creates unnecessary risk. What happens if $LEO’s price stagnates or declines? Without the flexibility to liquidate or diversify, how does the fund remain operational? Clarifying how $LSTR can navigate challenges like price stagnation or debt repayment without compromising its promises would help align expectations with reality. 

## Project Tone

Elsewhere in the thread, someone said, “I would be cautious about this one,” and the response from LeoStrategy was, “Funny to say when you haven’t looked into it.” Comments like that don’t inspire confidence. Just because someone hasn’t made a big post about their concerns doesn’t mean they haven’t done their homework. Responding constructively to skepticism fosters trust and shows confidence in the project, which would resonate better with potential supporters.

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I want to like $LSTR, because I want to like any project that iterates on Hive's economy.

But for those of us trying to evaluate it seriously, there are glaring contradictions and unanswered questions that need to be addressed. For instance, without a clear mechanism for servicing the loan, the entire strategy feels precarious. And while pointing people to blogs and threads may generate engagement, it doesn’t provide the kind of clarity or professionalism this kind of project should strive for.

A proper prospectus or consolidated document explaining the roadmap, risks, and mechanics would go a long way toward addressing these concerns. Transparency builds trust, and trust is the foundation for long-term success—not just for $LSTR, but for the ecosystem as a whole.

Posted Using [InLeo Alpha](https://inleo.io/@michael561/another-look-at-lstr-gwv)