UPX - A Theory of Upland Money

By Niqestates | A Journey in Upland | 28 Jun 2020


„Look, someone threw their money on the street,“ the llama said.  

„Money‘s everywhere on the road. You just have to bow down and pick it up,“ I tried a philosophical answer.  

The llama took a sip from its drink.   

„Technically money is never lost. There simply is someone else who owns it now. Today that lucky one is you,“ the llama explained to me, took its sunglasses and gazed at the sunset, absorbed in thought.    


 

When first stumbling upon the Upland vocabulary the essential use of the in-game currency UPX gets obvious really soon. Without UPX nothing of importance can be done in Upland. Just like every serious currency this only works because of its natural state of rareness. When you just started playing, this finding will hit you the hardest.   

But don’t worry! Basically there is just one serious step that you have to take, and that is becoming an Uplander. As soon as you reach a net worth of 10.000 UPX you get full participation rights and you are part of the general market. I can recommend to invest these 10$ for that 10.000 UPX not only to reach the required net worth but also to have some pocket money to start over.   

In my opinion the most „normal“ way to multiply your UPX account, if you don’t want to spend more than your initial payment, is by using common market mechanisms: Buy low, sell high(er).  

As we all know nearly nobody in this world wants to give you free stuff without inevitable necessity - or being forced to do so. Therefore you have to bargain in order to make a good deal.  

The following passages are highly speculative. I dare to take a look into the future to what extent the currency UPX may develop and how the community could handle this development for their advantage and satisfaction. Nobody knows what path UPX will take, so let’s think about possible scenarios.    

 

Inflation

Currently the number of players and the circulating UPX still is relatively low. Hopefully and most likely this will change over time. The city of San Francisco is not even roughly minted, especially the south of the city is "open wilderness". With plans for expanding to New York City within the next months the economic system will undergo significant changes. Therefore we can assume that the basic threat of massive inflation is rather small from the very beginning.   

But let's imagine the number of players explodes, property prices explode, and the market gets flooded with freshly purchased and spent UPX. Behind all selling and buying of property stands the concept of NFTs: Non Fungible Tokens. They are not mutually interchangeable by their individual specification and cannot be destroyed. This makes them some kind of real property that has „touchable“ and lasting value. NFTs as proof of digital ownership are decentralized from game developers and can be traded on third party marketplaces without permission of the actual game developers.  

This revolutionary concept shows an incredible amount of advantages. But it can not be denied that it can be damaged by the same dangers that can harm a normal economy as we know it in the real world.  

One enormous advantage of the game is, that the in-game economy will never truly stand still until the whole world map becomes accessible to the players. But to be honest: Despite of the fact that this would require an unbelievable amount of effort, today it doesn’t seem very likely to establish a property system that covers the whole world - but don’t underestimate the development of blockchain technology! Rising prices would lead to an increased demand for UPX. Although ownership is written into the blockchain, the game developers can control the supply with UPX. To conclude, if the economy goes through an inflation, they have tools available to prevent or to extenuate it.    

 

Deflation

Another extreme scenario would be the opposite case: A deflation. This becomes reality, if the value of UPX sinks continuously, what would lead to a fall in value of properties. Honestly, a deflation seems to be pretty unlikely at the moment. A decreasing demand for properties would lead to continuously sinking prices - just like every book on economics teaches. Upland is a rising star right now, thousands of players have joined the game and even more are joining every day. For now we are satisfied with this reasonable explanation. Let’s come back to the deflation scenario later, if it ever becomes reality.    

 

General pricing

If we take a look at the general pricing structure, we notice that the cheapest unminted properties cost about 2.500 to 3.000 UPX. Today we have a price level that is likely to increase over time. The simplest reason is the basic fact that the amount of in-game currency UPX that is given to the players floods on the market. It is hard to predict the exact monetary development, mainly because the constant joining of new players is also hard to predict. It seems to be self-evident, though, that the game developers will do everything to avoid an unbalanced economy.

 

Conclusion

The establishment of an own in-game currency is an experiment that will deliver interesting insights about the start and growth of a digital economy. After further opening of additional cities it will be of great value to see the development of prices in San Francisco - even more when the city is sold out completely. I will keep on reporting interesting monetary and economic topics in connection with the evolution of the blockchain.  



Disclaimer: This article does not reflect the official view and opinion of upland.me. All views are my own.
     

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Niqestates
Niqestates

I mainly write about blockchain technology and its use cases: Focus on non-fungible tokens (NFTs), gamification (upland.me) and the extraordinary fun part of the crypto universe.


A Journey in Upland
A Journey in Upland

This blog is dedicated to the blockchain-based game Upland (upland.me). Let‘s explore the dynamics behind it and the spirit of community within.

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