“Strategic scarcity,” “incubating demand” and “distributed value” – words tossed around since covering the guys at OptiToken, an automated tokenized portfolio they call “the first hyper deflationary cryptocurrency”.
The first term in the list could be compared to tools used by central banks in regard to controlling the supply of available currency to affect inflation and deflation in an economy. In this case, the tool will only be implemented to positively affect the price of OptiToken through the means of deflating supply.
To control this, the project incorporates what they call “trading cycles.” These consist of completing trades at a profit amongst a basket of tokens a, group of carefully and strategically selected cryptocurrencies that will be bought by the token sale event scheduled for early 2018.
When profits are created, the proceeds are used to buy OptiToken directly on each exchange where $OPTI is listed. This first step induces upward price pressure and adds volume to the OPTI markets. The team refers to it as “incubating demand.”
To protect from those tokens re-entering the market as potential sell-pressure, the bulk of the tokens – a fixed percentage – are purposefully sent to an un-spendable address. This means the tokens will be destroyed but still viewable on any Ethereum block explorer. The remaining small amount, only a few percentage points of each cycle, is sent proportionally to token holders supporting the OptiToken technical infrastructure.
Founder Sean Donato says:
This project builds on distributed value, which is something mostly unique to cryptocurrency and not so much traditional fiat.
To further elaborate, in this view, trading cycles can only be sustained based on creating profits from the company’s investment and trading activity. How can the project ensure that these cycles create a profit more often than a loss? To do this the trading will be overseen by three professional traders, who have years of experience successfully trading cryptocurrencies.
To date, the test portfolio has outpaced Bitcoin by nearly 100%, and all progress can be tracked at https://OptiToken.io. By February the team plans on connecting more real-time data viewable via API from their main corporate exchange account on Bitfinex.
The founder, Sean Donato, explains:
Opti is a truly unique token that has the ability and potential to actually sustain or grow in value during bear currency markets, as well as in bull ones. This project makes it possible for the value often created by some of the best traders in cryptocurrency to be distributed broadly to other cryptocurrency adopters should they choose to use OptiToken as one of their currencies of choice.
He also goes on to say:
No monies should ever purposefully be manipulated to decrease in value. It’s not a conduit to economic growth but merely a macro measure of a shortage of goods. Central banks endanger the world’s economies more and more every few years, as they adopt more extreme standards of interest rate manipulation and brush it off as ‘casual.’
The team seeks to incorporate machine learning and smart-contracting to enhance the project’s potential growth even further.
You can whitelist for the pre-ICO and ICO now and learn more about the project at https://OptiToken.io or follow on Twitter @OptiToken. The project is not available to U.S., Chinese or Grand Cayman citizens. In the future, this may change if supporting regulation allows it.
Guest-writer and company journalist Mark Taylor.
Images courtesy of OptiToken