Just a thought for all the @CantonNetwork retail folks willing to listen.
My take is that a cheaper CC today = a faster price appreciation in the future.
EXAMPLE:
Let’s say we have a transaction that costs $5.00 USD (example only - no idea on cost of each transaction).
With CC at $0.12, that transaction burns 41.67 CC.
At $0.17, that same transaction burns 29.41 CC.
If CC was $1.00, that transaction burns 5 CC.
RESULT:
With a circulating supply of ~39 billion:
- $0.12 requires 936 million $5 transactions to burn existing supply.
- $0.17 requires 1.3 billion transactions.
- $1.00 requires 7.8 billion transactions.
OUTCOME:
It is better to achieve a “violent” increase in transactions when the price of CC is low because it will burn off more of the existing circulating supply before the BME can react.
What do I mean by BME reaction time? I realize more CC will be minted while all this happens which will change the calculations above. That said, minting is based on TIME, not transactions. The faster the CC burns off, the MORE TIME it will take for the mint to bring balance. Speed of change is key for significant, fast price appreciation because the value of the minted CC is increasing as well.
At the end of the day, a cheaper CC at the point of “violent” change will set a higher price floor at equilibrium AND it will generate more FOMO in the market because the reduction in circulating supply over a short period of time will be harder to ignore.
Slow, steady growth with a CC price high = slow price appreciation.
“Violent” growth with a CC price low = violent price appreciation.
One last thing, once BME is reset, the circulating supply will rebound slowly until equilibrium is found. Equilibrium means burn = mint. Once the violent burn melts the circulating supply, it is gone and only a few catalysts can allow it to grow again:
1. Price stays above equilibrium,
2. Transaction volume decreases,
3. The cost of traffic decreases,
4. The mint schedule changes.
This is the promise @YuvalRooz has made us. Utility, not speculation.
Open to thoughts, counterpoints and corrections! These types of engagements educate retail willing to approach the subject with an open mind, myself included.
✌️
