Gone in 10 Minutes: Did I Make a Mistake Betting on Validator Node Which Could Go Up 20X | Investing Lesson of Uncorrelated Price Movements

2 mo
3 Min Read
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I have wanted to buy a Validator Node License since it announced despite not liking the fact that payment had to come in the form of SPS which I believed as cryptocurrency that could 50X from the price it was begin sold for. Validator Node License on the other hand cost $2,000 (taking $2 as VOUCHER price). Tranche 7 price is at $40,000 which means I will be looking to 20X my investment.

This is When Asymmetry Comes to Play

ROI does not exist in a vacuum. Prices move at difference paces for different assets. This is how you can make a profit trading on a market that went nowhere. If one asset goes up in value, then you have the freedom to sell that asset at a profit and go back into a different asset that is yet to see its full price potential. This is one of my most important investing principles. Uncorrelated prices are one of the most important things to keep an eye on when it comes to investing.

50% Unrealized ROI in 10 Minutes

Tranche 1 is now at sale for $3,000 paid in SPS. VOUCHER discount is given as $3 upto 50% of the total price. 500 VOUCHERs will cost you around $2 meaning you will only save about $500 resulting in an effective price of $2,500 which is still 25% higher than the prices I paid for.

HIVE-Engine Could Have Lower Prices

Both profits and losses are only realized when the sale happens. Until that, the gains only exist on paper. If the price on HIVE-Engine is the same as what is on the official sales page, there is very little incentive to buy from a reseller rather than @splinterlands meaning the $3,000 per Validator Node License won't be an immediate sight to see. At least I can stake my leftover SPS to earn those VOUCHERs + 53.77% APR (which went up from 24% possibly due to unstaking for Presale or pSPS-POLYCUB liquidity pool).

214 Validator Node Sold in 20 Minutes

These things are selling like hot cakes. Either some investors did not have 500 VOUCHERs or they did not manage to grab sufficient Validator Node during Presale. It is possible that some of them unfortunately missed out on the sale for being too late. Soon even more than 10% of Tranche 1 will be sold. These investors cannot be oblivious to the 20X price potential when sale of Tranche 7 kicks off.

Investing Lesson of Uncorrelated Price Movements

I am not looking at SPS prices spiking along with Validator Node Licenses. There is no liquid market to make sales at the moment and I do plan to HODL these Licences for some time. It should be possible to do OTC trades (preferably not using Discord for privacy reasons) and transfer Validator Licenses to other players.

I spent slightly above 9,000 SPS for the purchase. If I wanted to, I could flip the Validator Licenses at an instant profit which would have more than made up for all the APR I lost from not having SPS staked. Cryptosphere is full of such trades for quick gains if you know where to look for. Even if you were priced out of Validator Licenses or were simply uninterested in the project expansion, you can use this case study as a powerful lesson in investing. Who knows how many billions you would be able to gain based on this idea alone :-)

Happy Investing!

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Good luck! Keep us posted, the land of SPS has so many tokens now and moving parts I just can't keep up with it all.

The game seems to be doing well, but I kind of miss the days when I could just randomly buy a few packs and not feel like I had to understand and buy 10 items to effectively open some card packs.

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There is a certain beauty in that simplicity. I didn't feel any difficulty adopting to the current complexity as it came in small batches over time. For those who didn't follow @splinterlands developments real time could feel overwhelmed.

At least it is possible to play the game with assets you are familiar and slowly learn about additional things like SPS, VOUCHERs, Land, Validator Nodes etc. Modern/Wild formats for gameplay should help with the complexity too.

If you check DAU/MAU the numbers are looking very good. The best part is that #1 spot has been maintained for a long time by @splinterlands

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