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zmeldg

Understanding Market Capitalization and Factors Driving Increase

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They say  Cryptocurrency Market Capitalization or Cryptocurrency Market Cap is a useful metric to know the the real value of cryptocurrency. So how  do we compute Market Capitalization of DDK? Market Capitalization is computed using this formula:

Market Cap = Total circulating supply x price of each coin

Market Cap is the product of Total Circulating Supply and the price of each coin. Therefore, the drivers  for DDK to increase its Market Cap is through an increase in the Circulating Supply and increase in price. To increase the circulating supply of DDK, there should be an increase in number of staked DDK to have an increase in the issuance of new supply brought about by staking rewards and airdrop rewards (referral and chain referral reward). On the other hand, to increase the price, there should be higher demand than unstaked amount or available liquid DDK being sold (supply of liquid DDK). We significantly reduce supply of liquid DDK if we stake DDK which is also the way to increase the circulating supply. Is therefore a cycle. How do we increase demand? We can answer this without blinking an eye. Increase Adoption. Adoption means educating new shareholders and allowing them to understand and decide for themselves what they are willing to invest that will provide opportunities to them. Increase in demand should not solely rely on the existing shareholder who are just increasing their DDK. As shareholder, we must then should be responsible in educating people and teach others to embrace this technology - DDK blockchain.  We can say therefore that any project that will limit staking or any institution who will preach not to stake is not helping the price to go up, thus not helping to increase market capitalization. That is, inconsistent or veering away to the objective of the DDKoin and blocking the dream of the shareholder to maximize the opportunities they can get. 

Next question is, is it bad to have a lot of available liquid DDK that could be sitting in global exchangers? Straightforward answer is, It depends! If these liquid DDK are used to be traded to other crypto currencies or stable coins and the trader happened to benefit from the volatility of its prices and all the gains he acquires will be used to buy more DDK for staking, then we can now close the loop and say - DDK has the brightest future. We will reach the glory days of DDKoin. With all the projects linked to DDK like all the merchants increasing the use cases of DDKoin, that will all increase adoption. I must say, DDK has a very clear direction.

It is not easy to learn crypto including all the technology that revolves around it. Truth is, you can't just sit and wait gains. You really have to work for it. As a matter of fact, DPOS revolutionizes the POW that have been introduced by Bitcoin, and that significantly reduced the work to be done by just staking and voting once a week. But it is still work. Trading on the hand is also unconventional in itself and a trader really invest a lot not only money (or crypto for that matter) but also time not only to watch for the price but to understand and study the science of trading. It's all good because it is work. In physics, work is the product of force and displacement. You really have to exert effort (equivalent to force), in Filipino magbanat ng buto, and you really have to move forward (not stagnant). That will include change. The question is why do we have to work if we can get something for free? Oh will, free things will not last. "Sa pawis ng iyong mukha ay kakain ka" - hind kelan man mababali. That is the same reason we say, there is so such thing as free lunch. If others will offer you free things, you will end up paying for it in an expensive way in the end. So, work! Do your own research and manage your own asset.

Part of the work in understanding all about DDK, the recent increase of market cap of DDK from 26,245,075 USD (June 28, 2020) to 28,905,362 USD (July 3, 2020) with variance of 2,660,287 USD in just 5 days is remarkable. Why did I say remarkable, well for the whole month of June, Market Cap of DDK seem pegged to just more than 26,000,000 USD and never even reached 27,000,000 USD. Circulating supply has a steady growth rate of 0.05% daily, not much of the contributory factor in increase in market cap, same with the adoption rate (increase in new coinholder) with the 0.068% daily. But noticeably, there is an increase in the number of total staked amount that could drive increase in price since there is a reduction in supply of liquid DDK and demand is increasing. As a matter of fact, in previous days the difference of circulating supply vs total staked supply is always more than 1.6 M USD but today (July 3) it is only 1.57 M USD. Same reason the price is increasing with +4.04 % increase. Even if Bitcoin has a decreasing trend in price, DDK stays strong!

We are never wrong in investing time and money with DDK.

 

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Market Cap reached all time high of more than 32M USD. An all time high day increase of almost 3.8 M USD. Noticeably there is a significant increase of new addresses, new circulating supply, and fewer liquid DDK (unstaked)

 

1602265042_MarketCap1.thumb.jpg.ce2935bda4dd4dbb3a42a74350bdbcb4.jpg

 

Price.thumb.jpg.740cdd036cd068307c32c5568b28e454.jpg

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Questions :

1) Why not we reduce the time needed to get staking rewards? Instead of 4 times vote, lets say we can get the SR after 3 votes. Or every vote for every 5 days. This way, the circulating supply will increase faster right? Thus, it will increase the market cap. Higher market cap = Higher rank in CoinMarketCap

2) If i get this correctly, when the supply has reached 45 million there is no more point to stake DDK because there is no more staking rewards. So most circulating supply will probably being traded in exchanger. So stakeholders must learn about crypto trading too at the end if they wanna make more profit. ?
Otherwise if a large number of merchants accepting DDK as payment, that will change the whole story. Main problem is i really don't know what to expect when the staking rewards has finished.

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DDK being a decentralize cryptocoin is purely market driven. Economic usage and use cases for cryptocurrency is a very important element in increasing demand. I believe one day people will accept cryptocurrency as a norm. Just like how e-wallet (such as alipay) has evolved and now being widely used when it was non existent before 2003. It takes time but the future is very different from what we see now and cryptocurrency is going to be part of the financial ecosystem whether you like it or not. 

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18 hours ago, saifulpol said:

Questions :

1) Why not we reduce the time needed to get staking rewards? Instead of 4 times vote, lets say we can get the SR after 3 votes. Or every vote for every 5 days. This way, the circulating supply will increase faster right? Thus, it will increase the market cap. Higher market cap = Higher rank in CoinMarketCap

 

Just from my unsolicited opinion.

I think it's all about market timing.

if time reduction for staking rewards had shorten, depletion of unmined tokens will be quicker and definitely, supply will grow.

As of the moment where so few are familiar with DDKoin, not to mention cryptocurrency, it will be unwise to maximize the supply right now because it will only lead to devaluation of tokens.

Even we increase the circulating supply, we could still not improve  the rank if price comes low.

But if price increased , so is the rank in CMC, which could be achieved through token scarcity.

Besides, the only thing that will drive the of scarcity is the utilization of the Token which is currently develop by the foundation.

I believe we are on the right track, the way the foundation introducing DDKoin to the world and developing the technology at the same time.

 

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