It's been one week since the battle rewards switched over from DEC to SPS and the price of DEC seemed to be recovering a lot going all the way up to $0.84 per 1000 DEC. The momentum didn't last long as some of the players took the opportunity to dump some DEC back into the market after the pump.
Having DEC at peg is crucial for the future of Splinterlands and the recent change to battle rewards is a step in the right direction but that alone won't fix the problem. DEC supply is still increasing every day and there's no new incentive on the demand side, splinterlands needs to find a way to make DEC deflationary until we can get back to peg. The SPS burning mechanism ensures that DEC will never go too much over the peg because players would quickly arbitrage the price down.
We need more mechanisms to help support the price of DEC and one that could easily be implemented and would have a great impact on the supply would be to burn the DEC generated from market fees until DEC gets back over $0.95 per 1000 DEC or maybe a progressive mechanism that burns more DEC the lower the price gets and less as DEC gets closer to peg.
Just in the last 24H Market Volume: 93,960 sales / $58,635 that is enough to burn $2,931.75 worth of DEC just in 24 hours! Once we start getting close to the peg the team could turn off this mechanism.
New skins are also a good way to help reduce the DEC circulation but there aren't that many people buying them so it would have a very small impact. The introduction of SPS rewards to guilds will incentivize guilds to spend more DEC on upgrading buildings but that alone won't be enough.
Giveaway
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@flummi97 was the lucky winner from last week's giveaway! I will send your reward right away!
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Count me in 😊 @blitzzzz
Count me in giveaway. I got some profit in investing in dec when sps airdrop was started I kept dec for getting sps and the dec gave much profit then that.
Where does the DEC going to market fees usually go?
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I'm just here to meme on the obsession people seem to have with pegging :P
🤣🤣 with the state of crypto you’re going to have a lot of memes do distribute. Depegs every week
nah pegging is more fun than depeging if you know what I mean :P
It's going to be a challenge trying to repeg it and honestly I don't see how they are going to do it besides constant burns. But even at that point I could see it going over the peg and no one buying it with their sps.
A ton of people would buy it with sps since you can always burn $1 of SPS for 975 DEC so everyone will start burning SPS for DEC if it goes over peg. It is free money, you can rebuy the SPS you spent and a little more right after.
!gif DEC
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count me in please @ericburgoyne
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Thank you very much for the card!
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It's a bit sad to see the prices were only temporary but I guess the rental market is the only real use case for DEC right now.
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I think all that is needed is time. There is so much Dec supply that it will take a lot of time for all that supply to be bought up to buy packs and guilds building upgrades.
It is just a matter of supply and demand.
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You mentioned in the other comment
Most people just buy the packs directly from Hive engine instead of buying discounted DEC to buy packs. It will take a long long time to go through all that supply but eventually we will get there once the chaos legion packs get near to sold out.
True, but those packs need to be bought on the website first, to be able to be sent to hive-engine.
Also you only have a chance for the airdrop cards if you buy packs in the splinterlands shop.
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count me in
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they just mentioned in the AMA that their new tower arcade game will accept DEC. Hopefully that creates another sink gets thr price moving up towards peg.
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I totally missed that during the AMA. That will be great for DEC! It will take a while for the tower defense game to be out but that's ok, we can wait it out.
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