The Blockchain Of Opportunity: The Value Of Hive Equivalents
In accounting, they use the term cash equivalent to denote any holding that is can be viewed in the same light as cash. This are short-term investments that can quickly be converted. For example, a treasury note would be considered a cash equivalent on a company's balance sheet. So while it is not cash, it could become that with a few clicks.
On the Hive blockchain, HIVE is the base currency. It is what all is paired with, especially those tokens created on Hive-Engine. Over the last year, dozens of tokens showed up, creating value for users. While many have not gone anywhere but down, recent events show the potential.
As the blockchain expands in terms of the offerings presented, the opportunities for the user base only grows. All tokens generated on here are effectively Hive Equivalents since they can easily be converted to HIVE.
Many want to focus upon HIVE as the only source of wealth. That makes a lot of sense since, for the most part, it is the only thing that had much value at all. When you see tokens that are worth .000002 HIVE, it only makes sense to question what is really taking place with that project.
This caused a lot of people to overlook a nice pathway to growing one's overall account. Recent events with Leofinance show how quickly things can change.
Many are aware of the run up in the price of the LEO token. With the introduction of the move to wLEO, many are positioning themselves to take advantage of the returns available through the incentive program. This means that users are trying to get a hold of liquid LEO. With such a tight float, this naturally led to the rapid increase in price, from .14 to last sale at .36.
The sell table gives us an even more optimistic view. On this token, the spread is wide, a common occurrence with an asset that lacks a great deal of liquidity. This tends to make moves much more powerful.
For discussion sake, we will split the difference and use .4 HIVE for each LEO.
Many mention how difficult it is to get noticed and earn through their posting on Hive. The payouts, in HIVE, simply do not add up to much. Here, however, is a pathway that shows how one could easily compensate for that.
At this price, it would take roughly 1,250 LEO to have the equivalent of a Minnow on Hive. Checking the richlist, there were 305 accounts that reached this level.
Obviously, this is not in the same league as the Ethereum wallet holders but it does show another asset route for people. It is a lot easier to get attention on a platform like Leofinance as opposed to Hive.
Suddenly, we see what many view as "throwaways" becoming valuable. If individuals desired, they could convert their LEO over to HIVE, power it up, and instantly increase their standing. Of course, many believe that LEO has much greater heights, so they are working towards accumulating more LEO in hopes that it will appreciate even further.
I called Hive the blockchain of opportunity because these types of situations are showing up on a regular basis. Certainly, thus far, the payout for most is minimal. However, with some of the projects that are taking place, especially with gaming, we can see people having alternatives to increase their holdings. This could eventually translate into people deciding to increase their standing on Hive.
LEO get a lot of attention because it is the first one, that I know if, which truly captured the idea behind generating value at the second layer. While it is logical to believe many other projects are working hard to achieve the same end, they have not been able to see that translate into the price of their token.
Hopefully, over the next year, this is a situation that repeats itself on a grand scale. Projects that generate value can get noticed especially if they have a solid (and loud) user base who diligently works to improve the platform.
This is in contrast to the DeFi craze taking place on Ethereum. Many of those projects are simply pumps and dumps. Basically, it is a traders mecca for whales. There is nothing wrong with that and out of this will come very innovative ideas. It will also provide a ton of cash for many people (as well as costing others).
That said, projects that take the strategic route of providing something for their user base will realize longer term benefits. On Hive, this means going through the grueling process of developing the platform with regular updates as well as painstakingly trying to grow the number of users. There are no shortcuts.
Nevertheless, for those projects that follow this route, the payoff can be great. Suddenly, a layer 2 Whale in some project might have the equivalent of an Orca on Hive.
The Hive Equivalents can have great value and might be a pathway to some serious power shifts.
If you found this article informative, please give an upvote and rehive.
gif by @doze
Posted Using LeoFinance
