How to Increase Your Return Rate on Tokens
How profitable is it to buy tokens during a token sale? How can you calculate the rate of return on your tokens? These issues are now the most relevant and exciting for contributors. Unfortunately, there is no single magic formula that can give you the right answer. In addition, the objectives of token buyers can be so different — from supporting the project they like in addition to long-term profitability to short-term participation with the intent of reselling after the completion of placement.
The Ubcoin Market team (https://ubcoin.io/) is conducting the 4th stage of the token sale (the current discount is 13–44%). The team has prepared a list of recommendations that will help you increase the profitability of your contributions to a project.
1. Take part in the placement at the initial stages, when there are still good discounts for contributors. Discounting is a common practice for most token sales. At different stages of placement the discount amount may vary. The maximum discount is usually received by contributors joining the pre-sale stage, with each new stage the discount decreases. Ubcoin presale ended on March, 31 and gave its participants a 59% bonus! The current Ubcoin discount is 13–44% (depending on the size of a contribution). The amount of discount is proportional to the yield of currency, which indicates the already increasing yield of currency by the time it will enter the exchange.
2. Choose projects with a limited volume of released tokens. This strategy allows satisfying the growing demand for a token by increasing its price, since its offer remains unchanged. This market mechanism protects the token-holders interests and increases the profitability of their contributions. Over the period of the token sale, Ubcoin Market plans to release 650 million UBC (when the hard cap is reached), after which additional UBC will not be released. Moreover, the structure of the token sale contract is also important. Projects like Ubcoin only release tokens that are paid, which automatically guarantees the absence of unsold (extra) tokens in the pool. However, some other projects release all tokens at once, and redistribute unplaced on token sale in favor of other recipients, which, of course, seriously hurts attractiveness of tokens.
3. Pay attention to the availability of the Buy-Back token program. This procedure is the key to increasing the attractiveness of contributions — the company simply offers to buy tokens from holders at a comfortable rate for that price. There are several buy-back options that are used: the redemption is made at an token sale price or higher, or the redemption takes place taking into account the market price. Ubcoin Market intends to use the UBC Buyback Program, funded with up to 10% of Ubcoin’s net operating profits annually, to support the stability of UBC on the exchanges as needed. To facilitate liquidity on both buying and selling sides, UBC bought back by Ubcoin will be sold onto the exchange as needed depending on the underlying demand.
4. Verify whether the company plans to hold the price of its tokens. Sometimes a team, having reached a hard cap, can go into development without paying attention to the rate of its tokens. Even if the project had chances in a couple of years to increase the profitability of its tokens by tens or hundreds of times, contributor confidence in the first year of uncertainty will be lost, the rate of the token will decrease. In this case, having a chance to succeed initially, the project can face a deteriorating situation if the team does not reassure its contributors through maintaining the price of the token. Various tools can be used for this, for example, the creation of a Reserve Pool or a program for burning tokens. How are these aspects implemented in the Ubcoin Market? To create a Reserve Pool, we book at least 31% of the released UBC. Such an amount of tokens will allow us, if necessary, to protect the interests of our contributors from speculation and dumping of UBC from unscrupulous market participants. The Ubcoin Reserve Pool can only be used by decision of the Board of Directors in limited amounts to ensure long-term profitability and liquidity for UBC at a price higher than the price of the primary offering. The Burn Program is put into action by the Ubcoin Market in the amount of 5% of UBC for each commission payment made by the application. With the growing popularity of the application and the increasing profits from commissions, the amount of UBC in circulation will decrease, which leads to an increase in the profitability of our contributors’ tokens.
5. Check the percentage of tokens the team has. This is absolutely necessary! If the project participants do not reserve a certain percentage of tokens and do not contribute, you should not either! This is a sign that can guarantee that the project’s creators believe in it. The Ubcoin Market team reserves 12% of UBC, 3% and 4% of Community Rewards and Bounty & Advisors respectively, and 31% of tokens are in the Reserve Pool, and 50% of UBC enters the market (including presale). The percentage of the team is usually in the range of 10% to 50%, because less than 10% can cause distrust from contributors, and more than 50% creates a risk where the price of the token can be easily manipulated.
All these data can usually be found in the token sale’s WP or on the project website. If any information is not fully disclosed, it can always and should be clarified with the members of the project team, for example, in Telegram chats or on the project page in social networks.
Buying tokens always carries some risk of loss, but the profits can exceed all expectations!
If you decide to become a contributor and support our project, we are waiting for you on the token sale Ubcoin Market (https://ubcoin.io/).
