Improving Dash liquidity / volume for adoption

X

xdashguy

Member
The value of a trade-able asset is highly dependent on its liquidity. If you take two identical assets with similar inherit values and one is far more liquid the perceived value of the liquid asset will be much higher.

In addition, the adopt-ability of it will be much higher. Let's pretend you are Amazon and you want to use Dash. Dash has a typical volume of around $200,000 USD per day. The volume of the dash exchange could not even support them accepting it as a retailer.

Now, let's pretend you want to offer a service to help merchants accept dash that auto-converts dash to fiat. Your ability to convert dash to fiat and to do it within an acceptable loss (after all, trading even $5000 might change the market with such a shallow market) directly depends on the volume. And, since this type of service cannot exist very easily given dash volume there will be little merchant adoption.

Question:. There are other bullshit, non-innovative currencies that have similar or higher volumes than Dash. Increasing liquidity / volume is paramount to the success and adoption of Dash. Why is Dash so low given its innovation and length on market?

Case in point, as of right now of the top 10 coins Dash currently has #9 in volume.
 
xdashguy said:
The value of a trade-able asset is highly dependent on its liquidity. If you take two identical assets with similar inherit values and one is far more liquid the perceived value of the liquid asset will be much higher.

In addition, the adopt-ability of it will be much higher. Let's pretend you are Amazon and you want to use Dash. Dash has a typical volume of around $200,000 USD per day. The volume of the dash exchange could not even support them accepting it as a retailer.

Now, let's pretend you want to offer a service to help merchants accept dash that auto-converts dash to fiat. Your ability to convert dash to fiat and to do it within an acceptable loss (after all, trading even $5000 might change the market with such a shallow market) directly depends on the volume. And, since this type of service cannot exist very easily given dash volume there will be little merchant adoption.

Question:. There are other bullshit, non-innovative currencies that have similar or higher volumes than Dash. Increasing liquidity / volume is paramount to the success and adoption of Dash. Why is Dash so low given its innovation and length on market?

Case in point, as of right now of the top 10 coins Dash currently has #9 in volume.
Click to expand...

masternodes are deflating the markets
good : stability of price
bad : less volume

dash was never really a traders coin
 
tungfa said:
masternodes are deflating the markets
good : stability of price
bad : less volume

dash was never really a traders coin
Click to expand...

Sure, master nodes removes a certain volume of coins from the market. However, there are still a practical infinite number of currency units available for exchange given the divisibility of the coins, so if there was demand to trade it that demand would be met 100%. Even without the masternodes and without traders, it would still only mean 1 more trade would occur per coin on average (from one weak hand or miner hand who needed to convert to pay production costs to one strong hand which then holds the coin since we are talking about a hypothetical with few traders).

Really, I think the issue is that the coin has not attracted day traders, which are essentially liquidity providers. And, for whatever reasons, it has not even attracted many speculators (ignoring the argument that at this stage we are all speculators).

Unfortunately, it is almost impossible to have adoption without liquidity, so it becomes a chicken-and-egg problem. Without liquidity there is no way to efficiently convert dash to pay for inputs that require non-dash. Even the foundation itself was asking for off-market liquidity providers to convert its monthly budget to bitcoin / USD at one point since the depth of trading on exchanges was too small. Imagine the issue any retailer will face when deciding whether they can accept dash or not. Or, for that matter, any investors who will have to ask themselves "Will there even be enough liquidity to trade out of dash if I need to reallocate at a later date".

Question: Can anyone identify any commonalities in coins that gained increased liquidity so that Dash can emulate? For example, ethereum volume went from low million several months ago to now 44 million today. Even Factom is looking at nearly 2 million in volume today. Something Dash has rarely achieved.

I suppose the answer comes in some part getting access to exchanges and to hyping. The unified marketing / PR strategy has been a weak part of Dash in recent times. As liquidity increases, then serious investors will be able to make purchases and real businesses and merchants will be able to use it.
 
I think one of the key differences is that with crypto currencies, other than speculation, you buy them so you can use them to purchase goods and services. Ethereum has had a jumpstart because there are many services you can buy with it because of smart contracts (you can define your own services and pay for them). With DASH there is the coin mixing, and instantx, but few goods/services to actually spend it on. And then there are Masternodes which are great for the network and investors but put a damper on liquidity.

I think we could benefit from having a discussion on where DASH belongs with respect to these new decentralized autonomous contracts by technologies like ethereum. We want DASH to be digital cash, yes, and it is the most robust solution to being that. But how can we expand ways to use this digital cash, in both the short and long term? Could there even be a ways to spend DASH in a way that integrates with these technologies, without fundamentally changing what DASH is and the network architecture?
 
If Dash were on more exchanges it would solve this problem - so presumably if one were to offer to pay Kraken/ OkCoin/ Bitfinex all/ part of their development costs to modify their platforms to accept Dash via the monthly Dash budget- this would help uptake greatly.
 
I was just thinking today, how nice it would be to convert DASH real time into dollar, euro, whatever equivalent. Then I thought how that might work with your data collection through an API tied directly into the wallet. Then people, who are used to thinking in their native currencies can see how much money they "really" have at any point. And I'm thinking this could be a first step for possibly and instant Dash to fiat payment system somehow. I don't know, I still like the idea for usefulness as a wallet holder...
 
I guess this thread is in reaction to Masternode Dash volume thread I've created recently.

One way to go about it would be by changing the way masternode collateral works and allowing those coins to circulate somewhat. I haven't heard yet a tech opinion from a dev on how this can be done or if it can be done. I believe, by using a little bit of imagination, creating dynamic masternodes is doable.
 
Last edited by a moderator:
InTheWoods said:
I guess this thread is in reaction to Masternode Dash volume thread I've created recently.

One way to go about it would be by changing the way masternode collateral works and allowing those coins to circulate somewhat. I haven't heard yet a tech opinion from a dev on how this can be done or if it can be done. I believe, by using a little bit of imagination, creating dynamic masternodes is doable.
Click to expand...

So say, my MN coins "circulate," I buy BTC but my DASH in MN (where they aren't anymore) still perform their desired function?

What am I missing here? Or is this better than perpetuum mobile? Spooky action at a distance at its best? You can't have your cake and eat it turned on its head? Sure I am kidding out of ignorance for I can't fathom the collateral working like that. But than one puts her fiat money into a Certificate of Deposit and the bank lends it out at the same time it is shown in their ledgers like a double asset. Yours you hold in the CD and the loan out. I thought the whole idea of crypto currencies is to divorce ourselves from the Financial Fraud Cartel and their shenanigans...

But would like to see this working. All my CDs that I don't owe will go into such a solution :smile:
 
Last edited by a moderator:
tungfa said:
masternodes are deflating the markets
good : stability of price
bad : less volume

dash was never really a traders coin
Click to expand...

It seem to be traded in a quite volatile manner as I type this. (0.14) :smile:

I never really understood that idea. The last time I calculated (February 22nd) the total number of coins "locked" in masternodes was 56.91%. That leaves a smaller number of coins available to trade. Less coins -- bigger volatility implied. (you can move the price much easier if the asset is scarce; try moving EURUSD for 15.95% as it was DASH's move vs. BTC at the moment of typing)
 
GreyGhost said:
So say, my MN coins "circulate," I buy BTC but my DASH in MN (where they aren't anymore) still perform their desired function?

What am I missing here? Or is this better than perpetuum mobile? Spooky action at a distance at its best? You can't have your cake and eat it turned on its head? Sure I am kidding out of ignorance for I can't fathom the collateral working like that. But than one puts her fiat money into a Certificate of Deposit and the bank lends it out at the same time it is shown in their ledgers like a double asset. Yours you hold in the CD and the loan out. I thought the whole idea of crypto currencies is to divorce ourselves from the Financial Fraud Cartel and their shenanigans...

But would like to see this working. All my CDs that I don't owe will go into such a solution :smile:
Click to expand...
It's not the financial instruments that caused issues but central banks with their stimulus & money printing which encouraged very risky behavior and moral hazard. Most politicians don't like to point out to the root cause because central banks can help their approval ratings during the short duration of their 4 year mandate and who wants to bite the hand that feeds?
GreyGhost said:
It seem to be traded in a quite volatile manner as I type this. (0.14) :smile:

I never really understood that idea. The last time I calculated (February 22nd) the total number of coins "locked" in masternodes was 56.91%. That leaves a smaller number of coins available to trade. Less coins -- bigger volatility implied. (you can move the price much easier if the asset is scarce; try moving EURUSD for 15.95% as it was DASH's move vs. BTC at the moment of typing)
Click to expand...

Yes, you're right. Less liquidity also means less stability in a sense. The price stability of Dash comes from having a price floor. Price can't fall too much below a certain threshold due to masternode driven buying. This dynamic doesn't exist with other coins.
 
7dhdaQhZ said:
If Dash were on more exchanges it would solve this problem - so presumably if one were to offer to pay Kraken/ OkCoin/ Bitfinex all/ part of their development costs to modify their platforms to accept Dash via the monthly Dash budget- this would help uptake greatly.
Click to expand...

I agree however according to coinmarketcap it is trading on 29 exchanges. Ethereum is only tarding on 34 exchanges. 58% of Ethereum volume is on Pholiniex. Dash is trading on Pholinex also. This indicates to me that more exchanges are not necessarily the bottleneck here. We already have the bulk of the exchanges that matter.
 
xdashguy said:
I agree however according to coinmarketcap it is trading on 29 exchanges. Ethereum is only tarding on 34 exchanges. 58% of Ethereum volume is on Pholiniex. Dash is trading on Pholinex also. This indicates to me that more exchanges are not necessarily the bottleneck here. We already have the bulk of the exchanges that matter.
Click to expand...

More exchanges are not a solution. It can help a bit but it's not a real solution. Dash was already traded on Bitfinex and got delisted because of low trading volume.

Just take a look at a coin like MaidSafeCoin, which is only traded on two exchanges. It has bigger volume than Dash and currently ranked 5th by market cap.
upload_2016-3-13_17-0-42.png
 
InTheWoods said:
I guess this thread is in reaction to Masternode Dash volume thread I've created recently.

One way to go about it would be by changing the way masternode collateral works and allowing those coins to circulate somewhat. I haven't heard yet a tech opinion from a dev on how this can be done or if it can be done. I believe, by using a little bit of imagination, creating dynamic masternodes is doable.
Click to expand...

I actually did not see your thread. I have responded in your thread with my opinion on why masternodes have no effect on USD equivalent trade volume of Dash. I do not believe allowing masternode coins to circulate will have an effect on USD equivalent trade volume. If masternode coins circulate it would only have an effect to decrease effective price. The USD equivalent volume would be constant as it would be the price in USD that would be adjusted as Trade-able supply increases, IMO.
 
xdashguy said:
I agree however according to coinmarketcap it is trading on 29 exchanges. Ethereum is only tarding on 34 exchanges. 58% of Ethereum volume is on Pholiniex. Dash is trading on Pholinex also. This indicates to me that more exchanges are not necessarily the bottleneck here. We already have the bulk of the exchanges that matter.
Click to expand...

So Poloniex is down due to a DDOS. Poloniex accounts for ~80% of all Dash trading - the rest is on illiquid exchanges, many of which I wouldn't trust with my BTC/ Dash etc.

This is exactly why Dash needs to target another large exchange. Too many eggs in one basket at the moment...
 
I think evolution will be the ultimate solution for this. As there will be people (cashier) who take cash and sell you DASH.
 
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/wallets == hard to obtain/use == no adoption
If DASH has not made a breakthrough by the end of the year i have serious doubts about its viability and survival
 
You must log in or register to reply here.
Back
Top