How PRL Pricing Will Work in the Future
Currently (early 2018), like any other coin in the market, PRL is a speculative asset. Market psychology is based off of pricing precedent and raw demand/supply forces. Aggregate market psychology chooses numbers such as $10,000 BTC and $1,000 ETH, but there is no objectively good reason why ETH should be $1,000 instead of $500. Therefore, normal coins are prone to bubbles: panic buying pursued by panic selling.
In the near future the PRL market will not operate like any other coin, it will gradually transition from speculative to a storage peg evaluation. PRL is the only asset in the world that is pegged to something tangible (hard drive storage) in a decentralized way, without requiring a reserve. USDT is an example of a pegged coin; however, USDT is centralized and hence carries counter-party risk. Additionally, the dollar used to be pegged to gold but was then unpegged for political reasons. There has never been an asset that has been pegged to something tangible in a decentralized way, making PRL the first of its kind.
Pegged coins: Price is a blind trust with a centralized entity.
Non-pegged coins: Supply/Demand from utility estimation dictates price.
PRL: Smart contract dictates base market value, leading to less price speculation.
The ultimate question that will drive the market is what the PRL/GB storage peg will be. If the market were to evaluate PRL at 10x its storage equivalent value, the market would be clearly irrational and the price would correct downwards. If the market were to evaluate PRL at 1/10 of its storage equivalent value, the market would be clearly irrational and the price would correct upwards. Once the storage peg is set in the smart contract, it will be forever permanent. Therefore we will not rush in choosing the final variables. I’m expecting the final analysis to occur in May after main-net launch.
Despite the lack of finality, I will confirm two facts that are already known:
- The storage peg will increase over time, either per ‘X’ months or per storage usage in the Oyster network.
- The initial storage peg will be at least 64 GB per PRL per year.
If you have any technical questions feel free to ask here: https://t.me/oysterknowledge