In the currency circle, there is a very simple and well-understood consensus that “the more the locks are, the higher the price is.” This is the theoretical basis for the POS consensus mechanism’s most popular concept of “staking” this year, but this theoretical basis has been in the past six months. It seems to be defeated by the naked reality.
In fact, this logic is very well understood. There are one hundred coins on the market. If you don't lock the warehouse, then one hundred can be sold at any time, and the price is naturally difficult to stabilize. And if 80 locks are locked, only 20 are in circulation, then there are so few sells, and the purchase is up, the price is not rising?
Based on this theoretical basis, many coins have happily entered the positive cycle of “ rises – buy coins locks – the proportion of lock-ups – everyone is more optimistic – continue to rise ”. After hearing this, do you still feel that this logic is not flawed? It’s also true that it’s hard to be more and more circulated. In fact, this logical problem lies in the volume of liquidity and the amount of locks, regardless of the "market demand" that really affects prices. Let's just say that if there is no one in the coin market who wants to buy, then even if you only have one coin left in the lock, the price of the coin will continue to fall and fall until someone buys it.
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The premise of the positive cycle of “rising – buying coins and locking warehouses – the proportion of locked warehouses – everyone is more optimistic – continues to rise” is that the price of coins is rising . If the price of the currency does not rise but falls, ordinary users are not interested in participating in the lock. Because of the currency earned by the lock, the annualized interest rate, such as 10%, may fall within an hour. Finally, the participating nodes and voting of the locked position will only have large customers who are less costly and not sensitive to price changes (yes, the current EOS super node).
In fact, the initial focus of this year's hot staking model is good, the model is also very healthy, in simple terms, it is the realization of "the rise of PoS" on a large scale, so that PoS can also be decentralized and stable running, although No seed player has appeared yet, but still let everyone see different possibilities. But everyone overlooked that the premise of staking fire is actually a good market in the first half of the year. Believe me, if the next market continues to weaken, the currency of staking will gradually become the same as EOS, and the retailers will abandon the car and flee.
In fact, in the case of constant value fundamentals (even in the absence of fundamentals), the most important key to speculation is to make good use of the retail group's mentality of “chasing up and down, buying up and not buying down”. To put it simply, the higher the price, the more people buy it, and the people they hold will not sell in the process of rising, and they are willing to continue to hold it. The Staking model is actually accelerating the process. In the process of rising, a “Buff” is added to the people who don’t want to sell, so that the holder can enjoy the “rising + lock-up gain” double stimulation, and also stimulate the waiters to enter.
However, there is always an end to the rise. In a non-bullish market, the increase in the amount of money that can be given to a dollar is also the case. The lock-up can no longer prevent the panic from falling to the end. After entering the down cycle, this buff became "there is so much inflation every year, how does the coin support?", thus making the decline have a eternal negative.
However, investors never thought about it. The lock-up has revenue and currency. The annual inflation is the same thing. Otherwise, who is the money you sent to you? So the currency circle is a lot of wonderful things. The same news can be good when it rises, but it can be bad when it falls. However, there is no problem with the result orientation. After all, we have been like this since the student days. If you play the game and the results are good, it means that you work well together; if you play poorly, it is the poisoned teenager. It is.
The more the locks are, the higher the price is. It is definitely right when it rises, but it is a false proposition when it falls. So in general, it is still a pseudo-proposition. So don't expect too much to lock up the warehouse, you can forget this indicator.