Every year in crypto we see money pump a different subset. 2016 was the year of privacy, 2017 saw smart contracts take off, and 2018 had exchange tokens outperform through the bear season. Then came 2019, a year dominated by halving hype and deflationary tokens. A year where state backed interest rates, bond yields and currencies are racing to 0.
The 2017 altcoin bull run increased exposure, reputation, profits, infrastructure, innovation but maybe not understanding of market dynamics. We were spoiled, and expected coins to always pump.
Then came the crash, it would drain the enthusiasm and funds from most crypto projects. The new entries to the market were forced to learn what really moves price. Investors had to research the tokens to find an edge or risk losing their $. Some specialized in a niche and others generalized but everyone returned to BTC again for price predictions. There’s been renewed recognition for who moves the candlesticks for all cryptocurrencies. No more talk of ETH flippening, or XRP, BCH and LINK at $1000 by the end of the year.
Why though? Those coins, and more, were all considered technically superior cryptocurrencies. Faster, cheaper, smarter with better developers. So why no moon? We couldn’t see the forest for the trees. So caught up in TX fees, some of us forgot that holders and scarcity drive BTC gains. Not utility like money, where it’s spent fast and made constantly re-available.
Supply and demand have never been taught to us, at best, they were glossed over. We read more about trading indicators for BTC price and care less about fundamental ratios, like stock to flow. Some people knew BTC as a weapon against inflation was the killer app. Central banks have indirectly pumped BTC through their monetary policy. They can’t help themselves anymore, the politicians and bankers have become addicted to the free credit. Tether could never pump Bitcoin the way fractional reserve banking does.
Alts should just copy the scarcity then, right? Bitcoin’s slow and controlled inflation make it a better store of value VS the $? Then turn the supply inflation rate down into a deflationary one and we should increase scarcity. That’s one way to get gains without adding buyers. If you can’t increase demand, you can try decreasing supply. Always works, in theory.
A few cryptos experimented with deflation with limited success before 2019. Low liquidity, lack of platform exposure and creativity usually limited their potential for gains. One in particular, grabbed attention and became 2018's best large cap performer, BNB. Binance made everyone slightly more aware that deflation and high volume could drive prices up.
Early in 2019, a tiny project jumped out of the gates with BOMB. A deflationary token with 1 million max supply and a minimum of 1% burn on every transaction. They released it on Ethereum and airdropped it to participants for free. No huge legal fees or regulatory scrutiny. It required much less work and carried less risk than other forms of fundraising. More importantly, an honest and transparent airdrop is a healthier token distribution for investors. This International Free Offering was able to raise over $1,000,000 for the team, with the team only keeping a 10% stake. BOMB first sold for around $0.20 and would reach $14 in under 6 months. Even at BOMB’s current $4.50, they’re one of 2019 top 5 gainers (data from www.cointimemachine.com).
ICO’s aren’t viable for most of us any longer. STO’s haven’t taken off, due to restrictions. Most IEO’s are in a legal gray area. So BOMB has now decided to use their experience to help others launch projects through IFO’s.
On Sept 1st, BOMB will release it’s airdrop incubator BOMBX. It will likely launch on the Binance chain. It will give out future airdrops to holders of a new XIO token. This XIO will be received at 25 per every 1 BOMB token, but they must be held in a private Ether wallet. XIO will then be used on the BNB chain to receive future airdropped projects.
The holder drop should send BOMB price up, at least until the XIO snapshot. This should also make most traders move BOMB off of centralized exchanges and into private wallets to collect XIO. That means burning more BOMB and increasing market scarcity.
What could this do for price? It likely goes up from $4. Where do we peak on Sept 1st? 2x from here around $10? 3x to previous high at $14? Or do we see last minute fomo take us past all time highs?