Takenaka — the education system of the token pricing policy is one of the most discussed topics on the stock market. In this connection, Fred Krueger, founder of WorkCoin and PhD from Stanford University in mathematical methods of operations research and statistics, conducted a detailed analysis of the current cryptocurrency market brought eight key laws on which is based the modern model takenouti.
In the work of Krueger as an example, is regarded cryptocurrency ether, and are used to calculate the following variables:
TS (Total Supply) — the Total number of available tokens: 97,000,000 esters.
P (Price) — the Current rate of token: one ETH is $834.
The HT (Hold Time), the Time that the ecosystem participants can hold a token (share). For example, the value 0.1 will fit, if the average ecosystem members hold the token a little over a month (one tenth of a year).
TV (Transaction Volume) = volume of transactions per year, calculated in U.S. dollars. Consider the case when the market place transaction of $100 million per year, and assume that they all come with the token. In this case, TV = 100,000,000. In the case of broadcast TV = $1 trillion.
GTV (Growth in Transaction Volume) = the Growth in the transaction volume for the year. It is desirable that the value of the TV has increased to the extent possible. The rate of growth of 100% or more means that in the market there are new participants who need the token. The figure of 0% indicates that the token corresponds to a balanced price that will rise.
TT (Transaction Time) = Time of the transaction. How much time is spent on executing a transaction with a token.
TMCAP (Token Market Cap) = Market capitalization token = TS x P.
R (Ratio of Transaction Volume to Transaction Market Cap) = TV / TMCAP = the ratio of the volume of transaction in the year the market capitalisation of transacti. For example, for air the value is about 0.1.
R1 (R adjusted for Transaction Time) = R / TT. The value of R is adjusted in ratio with the time of the transaction.
R2 (adjusted R for Hold Time) = R / HT. Second value of R is adjusted in proportion to the time during which the network participants hold the token.
Act 1: the Value of HT should be the maximum
According to the article Kyle Samani, is devoted to the problem of the velocity of circulation of tokens, there is no benefit in investing in tokens that ecosystem members hold a short period of time. For example, those tokens that are intended for the purchase of tickets for events. If the need for tokens to appear only on the condition that the holder must purchase a ticket and the ticket seller immediately to cash or exchange them for other cryptocurrencies, such tokens may not appear long-term needs in the market. Even assuming very high transaction volumes (TV).
Law No. 2: HT > TT
The time that the ecosystem participants can hold a token (HT) is not equal to the time required to conduct transactions (TT). It’s not the same. In the case of transactions with bitcoin, each requires a relatively short period of time (less than a day). However, in order to buy bitcoin for Fiat, sometimes it might be a week or even more. Therefore, the average user, who are constantly in need of bitcoins most likely will purchase them, if possible, for the future, so they’re always in the account. The same applies to air or any other useful Aldona.
Obviously, so there’s a good reason to hoard the tokens, especially if they are difficult to buy and sell. Moreover, altcoins can enter a small Commission when selling (whip) and to reward those participants that are involved in their accumulation (gingerbread).
Law No. 3: Takenaka based on variables that are not captured under white paper
Many people make erroneous conclusions about the projects in detail does not paint plan tokeneke in their white paper. As the Law No. 2 economic many accessory options you can use after the launch of the ICO. The fact that the company did not plan their usage in advance, does not negate their existence.
Act 4: After complete startup of the token, the value of R should be much lower than 10
At the time of writing Ethereum was about one million transactions per day, at a ratio of $5,000/transaction. This net income equal to $5 billion a day, or forecast to exceed $1.8 trillion per year by extrapolating the current values. So, at the moment of maximal activity of the Ethereum network processed transactions worth $23 billion per day.
With a market capitalization of $81 billion in the network occur transaction by the formula R = TV / TMCap when the ordinal value of 0.1. Which leads to a value that is less than 10.
In the ecosystem, the annual income of which is equal to $10 million under $100 million turnover in tokens, the pressure to increase the rate of tokens is extremely low. On the other hand, if the annual income is 10 times higher market capitalization, as is happening in Ethereum, it is likely that the rate of the token will grow.
However, the value of R is very rough to estimate the cost of the token because it does not include the variable values TT or HT.
Law No. 5: I guess, there must be a reason to BUY tokens, not just to earn
In the previous analysis, it was assumed that the ecosystems were annual income, in other words, tokens are not just issued, but bought new participants. But not all ICO are working on the same principle. Many new players of the stock market believe that all must be given the gift, including the tokens with zero revenue model.
However, this time hard enough to perform. So, until recently, STEEM schedule seemed pretty hectic.
The market capitalization of tokens in STEEM $1.6 billion March 16, 2017 dropped to $17 million. But then it happened:
After new highs in December STEEM market capitalization is $1 billion. In this connection the word «probably» appears in the title of the Law.
Law No. 6: Indicators R1 and R2 are much better than R to calculate the value of the token
If the ecosystem is the ratio of the volume of transactions (R) at $100 million a year, and the average transaction time (TT) equal to 0.1 per year, for each specific period of time accounts for $10 million. If market capitalization is $100 million, then R = 1 and R1 = 0.1, which means theoretically any of the 90% of tokens that are outside of transaction, can be sold to Finance a new ecosystem participants.
However, this formula ignores the value of HT. If the average HT is 6 months, then 50% of these tokens are existing members of the ecosystem. In this equilibrium, any increase will affect the price increase.
Law No. 7: the Growth is important. VERY.
In any equilibrium state, the increase in the number of transactions reflected in the increase in prices. In this case, it is necessary to consider many other factors, which are difficult to perform correctly and to calculate their value. But while in the ecosystem is a sufficient number of tokens involved either in transactions or in the possession of the participants, their price will rise. This factor may explain the crazy growth tokens STEEM.
Law No. 8: you Need to strive to ensure that your sellers become your buyers
The true goal of any ecosystem is to make all parties both buyers and sellers. This is true both for the ecosystem of Bitcoin and Ethereum, where users buy cryptocurrencies and send them. The marketplace requires that sellers found themselves buyers of tokens, instead of just trading them for Fiat or other cryptocurrencies. This law is directly linked to the Law No. 1: the participants want to keep cryptocurrency, thereby increasing the value of HT.
To make a good model of the price tokens is extremely difficult. However, you should pay attention to:
High growth (or potential high growth).
Measures to promote ecosystem participants who are willing to keep the tokens, or Vice versa — to introduce the long transaction processing time, so that was an incentive to hold tokens. Alternatively, you can encourage those who hold the token and enter the Commission for their removal.
Acceptable circulation transactions (or possibility thereof) in relation to market capitalization.