DEC dips below $0.0014 today
As of this morning DEC (Dark Energy Crystals) has dropped to $0.0013839.
The value has been steadily spiraling downward for two months and is 50% where it was a month ago.
So what does this mean to someone without an economics background? That's me, I'm the guy with no economics background. I took Econ 101 and that was a long time ago!
I think what it means is that if the underlying currency goes down in value, then the assets also decline. Splinterlands cards are purchased with DEC, so when DEC is declining, are cards less desirable as assets to hold?
I bought a few cards this week below burn rate.
My assumption is that if DEC has less value, and cards have less value, then at some point we reach the stabilization point where buying cards and burning cards is equal in value to DEC or even profitable?
Which leads me to the request for help from those with greater wisdom in economics and investments.
My initial assumption is that DEC is held in big chunks and when those chunks dump into the market, the overwhelming supply drives down DEC value. As the DEC value dips, then cards reach a favorable burn point. Cards are burned. Since cards are finite number, the supply of cards declines, and card values go back up.
Feel free to comment and help a monster out. I love Splinterlands. I am in it for the long haul. I just want to learn more about the economics of the game.
Also, just a quick shoutout to #tribalex and @peak-monsters The screenshots are from their respective websites. If you want to track cards, trade cards, rent cards and sell cards, I recommend www.peakmonsters.com
If you want to play a great game where you can earn money, play Splinterlands This is my referral link.
Finally, the HiveFive team is working on the second edition of Blockchain Vampires. Get in position early by using either #bvamp or #bhuman tags.
Great piece you've written here! I'm sure many players ask themselves these questions about the game economics, and once you do some research it can become very complex very quickly, as there are so many factors that matter. In my opinion what we're mainly seeing here is just a factor called hype, which seems to be really common with almost any cryptocurrency. Even though this is a blockchain-based game, I've seen it with different card games countless times. A good example of it is Pokemon, at one point the cards are totally hyped, and Charizard doubles or triples in price. Next year prices decline and it halves in price, giving you a good investment option.
I just started playing Splinterlands but looking at how many prices dropped in the past few months, I would say now is the time to grab your "free meal" whilst everything is discounted. (please beware this is not financial advice).
Hopefully, this helps to fade away some of the negativity people feel about the prices going down. At least for me, I see it as an opportunity to hoard a new collection without the feeling of risking too much.
I am also continuing to add cards. I think the decline in Hive also pushes down DEC, but I think also, that DEC is being driven down to 0.001, so that SPS can become the preferred currency for Splinterlands. We'll see, over all I am bullish even though we seem to be fighting a bear at the moment.
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Check out the last post from @hivebuzz:
DEC is pegged to the USD, so 1000DEC will constantly be close to $1USD.
The card prices are displayed in all the markets in USD to avoid confusion, even though we purchase the cards using DEC or Credits.
The cards are limited on the distribution model so the price in USD will change, but the balance DEC to USD won't vary that much.
Hope you are not more confused.
Peace