Chia seems to have potential as cryptocurrencies go. Cryptocurrencies seem to have established themselves as investment vehicles. Whether they successfully become actual currencies is still not clear to me.
I would think the size of the total network could be used to establish a short term price floor for chia. I wouldn’t expect people would sell XCH for less than the cost to produce it. This seems to be determined by the size of the total network space (hence ones odds of winning), the cost of the plot storage media (drive cost and electricity), and the life expectancy of the media (drives die eventually).
Woke up to the price up at around $900 with trading volume almost double of yesterday. Seems like some of the recent news about Chia hitting CNN and other outlets is drawing interest…
Sensationalist title, they just posted an article on how to set up Chia farming to their Chinese website, as an example use case, which they’ve since taken down again, but “Amazon all in on Chia” is how some people seem to have taken it…
Whilst I’m enjoying the current price of Chia by looking at my current XCH I have from initial investment, I can’t get my head around the current high price. It will be mostly driven by the short supply compared to demand, fomo and the fact us farmer worked harder than the ‘hardware cost’ to acquire the XCH.
I can’t envisage the price holding when the IPO comes from such a large pre-mine and millions of XCH get dumped into the market.
I feel more comfortable with the price when I know I’m going to hold onto these bad boys for 5 years minimum and watch the Chia team create something magical.
I don’t see that scenario happening, if they liquidated the “strategic reserve” it wouldn’t be much of a reserve anymore. From what I’ve heard/read they intend to hold on to the majority of their XCH and possibly pay it out to shareholders over time or dip into it only as necessary. When the company goes public their share price will be inherently tied to their biggest asset (which would be the strategic reserve), so they wouldn’t want to dump it because it would significantly lower the share price.
I haven’t paid much attention to the business paper. It’s not legally binding and already went through update. They want to loan from the reserve. That’s an outdated view on banking, but at least some plan compared to Bitcoin crazies. But from what I understood about IPO it could be an ICO, shares convertible to XCH, certainly for current funders.
Apart from that Bram Cohen sure could personally convert and adjust price as he pleases?
Mr. Cohen will own approximately 47.4% which combines his founder’s equity and his subsequent cash investment in a SAFE on an as converted basis.
If we make the assumption that the prefarmed 21m XCH will never go into circulating supply, then XCH market cap is much more reasonable, even at the current $1100 price. https://www.chiaexplorer.com/ says that there are 493,822 farmed XCH giving a market cap of $543m which would place it on coinmarketcap at #127. Far more reasonable than top 25 but still high.
I think the right price is 300 - 400 compared to other cryptos, so buying at the all time low of 450 would have been a sound plan in hindsight. The current trading volume suggests we probably won’t see it dip down to that level again
