ETH/TRAC Pegging Parity

One of the biggest problems investors are facing when participating in ICOs is the fluctuation of contribution currency regarding ERC20 token, creating pricing problems in any ICO that lasts more than a day. Token sales can take a while to close the set hard cap, therefore run into price movement issues.

A simple and very effective solution for fluctuation risk of ETH mitigation is a “pegged” price of ETH in respect to USD and Trace token. There are different strategies when determining such parity. The most common ones are “Spot Pricing” and “Volume Weighted Average Price (VWAP)”.

Spot pricing method uses current price in the marketplace at which a given asset (in this case ETH) can be bought or sold for immediate delivery. An average price in a certain timeframe gives you an indication to what you can “peg” the parity.

Volume Weighted Average Price (VWAP) is a more complex model that uses benchmark data by adding up every transaction that has been made and then dividing it by total trades in a given period.

By examining historic ETH data exchanges trading ETH/USD, we decided to conduct the VWAP model for a more accurate and detailed ETH/TRAC peg. Trades and prices of a 72h period starting from 11 January 2018 15:00 (UTC) to 13 January 2018 15:00 (UTC) have been collected and analyzed. The team’s decision is to peg the ETH/USD parity at 1,255.00 USD for 1 ETH, therefore ensuring a fixed price for Trace token during the entire token sale.

OriginTrail Token sale parity:

1 ETH = 1,255.00 USD

1 TRAC = 0.10 USD

1 TRAC = 0.00007968 ETH

1 ETH = 12,550.00 TRAC

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