A Key Feature Of Crypto Assets: Scarcity

There are numerous variables to consider when investing in crypto. Who is running the project, what the promised utility is, and the token economy are the most important factors to consider.

Scarcity

I am sensible about the token economy, which is one of the factors that determine the value of crypto assets. If a crypto asset does not satisfy me in this regard, my appetite to invest greatly diminishes.

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A crypto project gathers builders, users, and investors around a value proposition. We become a partner by purchasing the coin, token, or NFT. Crypto assets produced after our investment means that our current share is decreasing. If we also benefit from the asset created in this way, that's ok.

Minting extra crypto assets means demanding more funds from investors. Before demanding additional funds from investors, the crypto project needs to provide them with a return.

In the bear market, we are going through, the importance of token inflation has become much more evident. The common feature of the coins that have lost less than 40% in the last three months is that they have near-zero inflation.

Scarcity is much critical in the NFT market. People want to buy rare NFTs for the money they pay. Selling all NFTs produced supports the price increase potential. Especially if these NFTs have an area of ​​use, the value becomes more evident.

PSYBERX NFTs

The power rule applies in the NFT market. Among hundreds of collections, only the top collections have a high price floor. On the other hand, the rarest pieces in collections also bring good returns. For example, for the commercial plots of the play-to-earn game PsyberX, consisting of only 50 pieces, the floor price is still 45,000 Hive. Commercial plots were designed to be 25 times the size of small plots. As far as I know, no sale has taken place at this price level. Still, seeing these kinds of prices excites me as a @psyberx enthusiast who owns one of the commercial plots. On the other hand, in the small land plots of the same project, the floor price is 120 Hive. Because these small plot lands will be 10,000 in total. For the scarcity effect to occur on small plots, the game will need to be launched and played by a large number of players.

Cubdefi and PolyCub

Another project where scarcity makes a difference is PolyCub. The @leofinance team has two DEFI projects, one on the BSC network and the other on the Polygon network. Due to market conditions, both PolyCub and Cubdefi's tokens are oversold. Still, with a deflationary token economy, PolyCub's market value is 1.5 times the market value of Cubdefi. Although both are attractive for investment, I prefer Polycub.

Because in the second week of June, the number of Polycubs produced per block will decrease from 0.5 to 0.25. Also, large amounts of PolyCubs earned will have their lock period expire. If the general market conditions also help, this dual effect can be reflected positively on the Polycub price.

Conclusion

Having a small number of NFTs in a collection or a low inflation rate for a coin is not enough. In the case of PsyberX, commercial plots are valuable because they will have a function in the game. In the case of Polycub, the fact that the platform makes money through protocol-owned liquidity makes a significant difference. In addition, the teams carrying out these projects can communicate effectively with the investor audience they address.

On the other hand, it would not be correct to describe the token economy with a simplification such as "deflationary assets are good". Highly inflationary tokens can also be beneficial in multi-token and NFT combinations. Constructs can be created in which the crypto assets of the ecosystem support each other's value. Or, high inflation may be accompanied by high returns.

The combination of a cleverly designed token economy, effective leadership, and high community motivation often achieve the desired results. I hope this will also be the case for the PsyberX and Polycub.

Thank you for reading.

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