A Big Week Ahead
This week we shall see the Vasil hardfork take place on the CARDANO Blockchain allowing for less congestion and faster transaction speeds. This is staying ahead of the growth curve as many expect the CARDANO eco system to explode.
I haven't been waiting for that but have been waiting for the launch of their stablecoin DJED. DJED will be the stablecoin used to pay for all transactions on CARDANO. This is important as these fees will be funneled back to the COTI Treasury for the investors who have been staking.
COTI released some examples of the fees last week that could be generated and this is pure speculation. The examples were all based on the current transactions taking place over the last few months and not what it could be.
The one example had the earnings at $4 million per month which may not sound huge but considering the COTI Treasury only has $40 million staked this figure is more than significant.
<img src="https://i.imgur.com/b81FVxD.png"/.
The numbers don't make sense as they currently are and tell you immediately that something has to change to make this work. The only solution is the COTI Price increasing would solve this and is that simple.
The current APR is currently 10.71% with a total locked up value sitting at $46 million. $4 million in rewards monthly is roughly 10% in rewards and why the price has to rise significantly. I say this a3 $4 million is roughly 40 million COTI which represents 2% of the entire token supply paid out monthly. A 10c COTI would need to rise significantly as these COTI need to be purchased from exchanges.
The liquidity will be squeezed as why would anyone be selling if they were being well rewarded for staking? The Treasury represents over 40% of the current circulating supply so with some rough calculations there is only 15 months supply externally.
COTI at $1 or $2 would solve this issue as one would only need to find 2 or 4 million COTI each month to pay the Treasury. The Enterprise tokens are coming within the next 3 months so there will be more COTI required to pay those fees back to the Treasury so unless more is staked suddenly the APR being earned is going to explode very quickly.
The current APR being earned is from the current earnings COTI raises through their merchant payment systems using their Trustchain. From what they all expect is that those current earnings will be matched by DJED or close to that without taking into account what will be arriving in 3 months time with the Enterprise tokens.
This tells me the price has to rise and will once everyone realises the APR that is now on offer. My prediction of 15% still stands for now, but that could easily rise to 20% plus depending on how large the CARDANO DeFi fees and the Enterprise tokens become. This is why doing your own research pays off as getting in early is where the real wealth is made. This is why being involved in projects really does pay off as you get to spot things others don't see until it is too late.
Personally I always enjoy playing around with numbers as this makes more sense somehow than trying to second guess what is happening next. The numbers tell me the price has to rise as that is the only option due to the demand.
Posted Using LeoFinance Beta
