Same can be said about the early pre-IPO shareholders of various tech companies. It's probably still early though as TroyDASH said.
Dynamic Masternodes - Masternodes` impact on trading volume/liquidity
- Thread starter InTheWoods
- Start date
Same can be said about the early pre-IPO shareholders of various tech companies. It's probably still early though as TroyDASH said.
I do not believe that masternodes have any affect on trade volume / liquidity. For purposes of this response, volume refers to the USD value of trading that occurs (not the number of Dash units traded, which is not relevant). Master nodes most likely do have an effect on price, but not on USD trade volume. The effect Master nodes have is reducing Trade-able Supply which is essentially the supply used in a demand / supply relationship. It also may have an effect on Dash units traded, but that volume measure is not important for economics at this time.
Given that Dash is infinitely divisible (for practical purposes), you will not see an effect on volume due to hoarding. Let's pretend one day that all Dash are locked into masternodes such that there is only 1 Dash in Trade-able Supply. Now, let's pretend there is 5 Million USD of demand for Dash at any price. That one coin would just be divided at whatever price would be necessary for the 5 Million USD in demand volume to occur. It would definitely have a huge effect on price and it would definitely have an effect on volume of Dash traded, but it would have no effect on USD value traded which is typically what people refer to when they mean volume / liquidity.
So, given this, Masternodes are non-issues, IMO, in the discussion of USD trade volume.
TroyDASH
Well-known member
It's not the "scarcity" of the coins, as in, the raw total number of coins up for trade that is the reason for the low volume. It's the scarcity of the actual value on the buy and sell orderbooks. And the reason people are not putting up a lot of value on the buy and sell order books is directly related to what people's motivation is for buying and selling. If the #1 reason to buy DASH is to get enough to start up a masternode, those are the types of transactions where the DASH is not likely to change hands very often. But if people are buying DASH in order to spend it on goods and services, then those transactions are very likely to be changing hands often, and the people accepting that DASH will be more likely to be converting to BTC or fiat than someone who is operating a masternode. Something like Ethereum has some very interesting services to offer from the network itself (no comment right now on the pros and cons of ethereum). DASH has a coin mixing service but very few other goods and services available (instantx is great but there is very little real world availability right now to use this to buy an actual product or service). If we want more volume, we need more goods and services that we can use DASH for, whether it comes from more retail integration or network services or wherever.
Otaci
Member
Shared masternode hosting has been brought up a couple of times. I know there is already at least one service offering this. What if this was to happen on a large scale? What if people were able to participate with tiny amounts? If people could earn 11% on any amount, would they just hoard everything? What would this do to the supply/liquidity of DASH?
TroyDASH
Well-known member
There's going to be hoarding for every crypto, especially ones that are new and that have a finite number of coins. The possibility of shared masternode ownership kind of produces a proof-of-stake effect across the whole network. Whether this is a good thing or not is up for debate. Pretty much ties right back into the topic of the currency being deflationary
I agree with you. My point was is that masternodes are not related to the issue. If you got rid of master nodes or increased master nodes it will not have much significant impact on USD volume traded. That will be dependent on USD demand. Currently the demand is for masternodes so it is increasing trade volume (not decreasing it) as it increases demand for the coin. If you got rid of master nodes all it does is decrease the USD demand. If you increase the amount of trade-able coins all you do is decrease the price --- the USD demand will still the tstay the same.
The only way to increase volume in USD terms is to increase the attractiveness of the coin for day traders, purchasing products, investing, etc. I am now convinced the #1 way to do this is through ATMs. We need to dot the world with 1000s of ATMs. It will reduce buying friction and each machine will serve as a 24/7 piece of marketing that introduces casual users to the idea of Dash.
TroyDASH
Well-known member
Ok, ty yes I understand your point now & I agree. If creating masternodes makes up a high % of the total demand, it doesn't decrease the volume because it isn't a zero sum in terms of demand for masternodes vs. demand for other things.
ATMs are great in terms of access to the currency but ultimately I think it's all about the end goods and services. If there are so many great things to use DASH for, and people really want to be able to get DASH easily then ATMs are going to be coming out of the woodwork without us even needing to push them that much.
logicalmayhem
New member
Just read the whole thread
I'm a big fan of the technology behind DASH and if i was going chose an altcoin to be used widely, DASH would be the obvious choice.
The big problem is that the best technology doesn't always win, it's much more likely that an adequate technology that gains widespread adoption will outcompete it (Think IPv4 or VHS).
As a day trader price is the least important factor, volume is by far the most important aspect. Take DOGE for example it has a really stable value but without the volume noone buys at the highs or sells at the lows, so no matter how smart you are there is no profit to be made. Traders work by taking advantage of the dumb money in the system, and there isn't any dumb money trading dash.
No traders == Low volume == not added to exchanges== hard to obtain == no adoption
If DASH has not made a breakthrough by the end of the year i have serious doubts about its viability and survival
I'm a big fan of the technology behind DASH and if i was going chose an altcoin to be used widely, DASH would be the obvious choice.
The big problem is that the best technology doesn't always win, it's much more likely that an adequate technology that gains widespread adoption will outcompete it (Think IPv4 or VHS).
As a day trader price is the least important factor, volume is by far the most important aspect. Take DOGE for example it has a really stable value but without the volume noone buys at the highs or sells at the lows, so no matter how smart you are there is no profit to be made. Traders work by taking advantage of the dumb money in the system, and there isn't any dumb money trading dash.
No traders == Low volume == not added to exchanges== hard to obtain == no adoption
If DASH has not made a breakthrough by the end of the year i have serious doubts about its viability and survival
