Pearlvine Mynts have values because they
are useful in the form of money. Mynt has the characteristics of money
(durability, portability, flexibility, scarcity, divisibility,
and recognizability) based on the properties of mathematics
rather than relying on physical properties (like gold and silver)
or trust in central authorities (like fiat currencies).
In short, Mynt is backed up by mathematics. With these
attributes, all that is required for a form of money to hold value is
trust and adoption. In the case of Mynt, this can be measured by
its growing base of users, merchants, and startups. As with
all currency, Mynt’s value comes only and directly from people
willing to accept them as payment.
The price of a Mynt is determined by
supply and demand. When demand for Pearlvine Mynts increases, the price
increases,
and when demand falls, the price falls. There is only a limited
number of Pearlvine Mynts in circulation and new Pearlvine
Mynts are created at a predictable and decreasing rate, which
means that demand must follow this level of inflation to keep
the price stable. Because Mynt is still a relatively small market
compared to what it could be, it doesn’t take significant
amounts of money to move the market price up or down, and thus
the price of single unit of Mynt is still very volatile.
A fast rise in price does not constitute a
bubble. An artificial over-valuation that will lead to a sudden
downward
correction constitutes a bubble. Choices based on individual
human action by hundreds of thousands of market participants is
the cause for Mynt’s price to fluctuate as the market seeks price
discovery. Reasons for changes in sentiment may include a
loss of confidence in Mynt, a large difference between value and
price not based on the fundamentals of the Mynt economy,
increased press coverage stimulating speculative demand, fear of
uncertainty, and old-fashioned irrational exuberance and greed.
A Ponzi scheme is a fraudulent investment
operation that pays returns to its investors from their own money, or
the money
paid by subsequent investors, instead of from profit earned by
the individuals running the business. Ponzi schemes are designed
to collapse at the expense of the last investors when there is
not enough new participants. Mynt is a free software project with
no central authority. Consequently, no one is in a position to
make fraudulent representations about investment returns. Like
other major currencies such as gold, United States dollar, euro,
yen, etc. there is no guaranteed purchasing power and the
exchange rate floats freely. This leads to volatility where
owners of Pearlvine Mynts can unpredictably make or lose money.
Beyond speculation, Mynt is also a payment system with useful and
competitive attributes that are being used by thousands of
users and businesses.
Some early adopters have large numbers of
Pearlvine Mynts because they took risks and invested time and resources
in
an unproven technology that was hardly used by anyone and that
was much harder to secure properly. Many early adopters
spent large numbers of Pearlvine Mynts quite a few times before
they became valuable or bought only small amounts and didn’t
make huge gains. There is no guarantee that the price of a Mynt
will increase or drop. This is very similar to investing in
an early startup that can either gain value through its
usefulness and popularity, or just never break through. Mynt is still
in its infancy, and it has been designed with a very long-term
view; it is hard to imagine how it could be less biased towards
early adopters, and today’s users may or may not be the early
adopters of tomorrow.
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