Everyone who has to do with cryptocurrencies knows how difficult it is to understand in which direction a token will move in the coming months.
The question for those who trade is: Long or Short?
Holders would also like to know in which direction the market will move to start their accumulation plan.
As we know, Ampleforth (tip) has been added to Publish0x for about three weeks. AMPL is (almost) a stablecoin that modifies the supply (rebase) to keep its value on 1 dollar. I always pay attention to particular tokens like these, in fact I had already talked about Ampleforth in a July article: How Ampleforth Works: A Volatile Stablecoin
Today I want to talk about a similar cryptocurrency, called Base Protocol (BASE).
The BASE price depends on the total market capitalization of ALL cryptocurrencies with a 1: 1 ratio. BASE allows traders to speculate on the entire cryptocurrency industry with just one token.
A bit as if the whole sector had been tokenized via BASE (the whole sector represents the underlying asset).
The protocol is an Erc20 built on the Ethereum blockchain, integrates an Oracle (Chainlink) and is swapped on Uniswap (being an Erc20 it is possible to deposit it on Trust, MyEtherWallet, Metamask , etc).
The idea is therefore to simultaneously invest in all those crypto assets in the world.
-If crypto market cap is $ 750B, BASE is $ 0.75
-If crypto market cap is $ 300B, BASE is $ 0.30
Price anchoring is achieved through an elastic supply protocol using "rebase" (like AMPL). When the price is in equilibrium with the market capitalization of the entire sector, the rebase does not occur. Otherwise the supply is decreased / increased. The rebase can therefore be of contraction (the scarcity increases and therefore the price up to equilibrium) or expansion (the scarcity is decreased and therefore the price up to equilibrium).
On Uniswap there is also a liquidity pool where by depositing Base you receive rewards (which increase based on the liquidity provided).
To learn more: Base Protocol and Litepaper (BASE Protocol)
What do you think of these tokens with an "elastic" supply?
