I'm happy for you. Too bad I don't know enough about all this token burn/distribution stuff to make any sense of it. I have no clue as to how this all benefits you or anyone else who creates a token. As far as I can tell, it costs money to create a token. That token is then always tied to the parent token or coin it is created from. As the parent token goes up or down in value, I expect the derivative token would likely do the same. I don't understand how or why having your own token is desirable. Obviously, you have much more insight on tokenomics than I do. If it isn't too much trouble, could you explain it to me in simple terms?
Here is an example of my understanding:
You are making art and selling it for ONE of your tokens. If that art piece is worth, let's say, $10, then you just gave someone $10 worth of art and set the value of your token at $10. Yet, you gave the token away for free, so you basically lost money in making the token and gave away your art for free. So, short-term, it is a losing proposition for you. In the long term, if people get used to using your tokens and there is a desire to own your art, then eventually, demand outstrips the free distribution and people are forced to purchase your tokens on the open market, which will hopefully be reflected by that initial $10 sale. THEN you start to recover your losses and begin making money as people purchase your tokens at $10 each? Is that kind of how it works?
Why it's desirable depends on what you consider the purpose of the token to be. It does cost money to create a token, both on Ethereum and Hive-Engine where DEIA lives. I'm not sure that the price of a token is as tied to the native token of the chain its on. There's lots of wildly different tokens on Ethereum whose price don't seem to move in unison with ETH at all. That being said, I think tokens do benefit from a native token going up price as the ecosystem can be considered stronger.
There's are psychological, financial, and gamifying elements to why I want to use my own token. If I want to create a community around my art, using HIVE or ETH as a unifier (something that binds) for the community is not feasible because those communities are already very broad and if I wanted to give them anything, it would cost way more money to do that with HIVE or Ethereum than with DEIA. So I save resources by knowing who are already interested in my work, through who is holding or interacting with DEIA. If I want to make a game that leverages blockchain technology, it is easier for me to test that and use it with DEIA than HIVE or Ethereum again because I have more of it than HIVE or ETH. I can also make decisions about how DEIA works and how it's distributed that I can't make with Hive or Ethereum, which interests me from an economics perspective. Because I control DEIA more, I can play with ideas I think are interesting but would not be a good idea for Hive or Ethereum. That's where we start getting into the value of art vs the token.
So for the art that I make, part of it will be put aside to exchange for DEIA. I'm free to do whatever else I want with the rest. So if I make 10 art prints, say I can sell 8 of them any way I want - for $$, for crypto, etc. 1 gets set aside for a vault/collection I'm keeping of my art and 1 gets set aside to exchange for 1 DEIA. I try to average out the costs of trading that art for DEIA on my end by having it be part of a bulk process. So theoretically I can price the other 8 to absorb the costs of the last 2, assuming all 8 sold. Currently, I'm in the beginning of my career so it'll be a while before that happens! But if I keep investing in my career, my sales will pick up. Once that happens, the idea of trading 1 DEIA for 1 piece of my artwork will be more attractive. So it will be incentive for those who are interested in my work to be engaged with DEIA and how to get it. I think this will take a long time tho! Several years at least. I think by this time, the price of DEIA will go up and both my artwork and DEIA will be worth more. But this will depend on how well I am able to make DEIA interesting and fun for people to hold and trade.
So I think it takes a lot of effort and investment to do the token but I think I am interested in tokenomics and want to experiment with using blockchain in games so it is worth it to me. It is interesting. I think the money I spend will have to be considered money invested in my career.
Does that make any sense?
Thanks for your good question!
!ENGAGE 25
Many thanks for the big answer. Let me see if I understood all of it.
My take-away was that you think you can use the DEIA token to create an economy with it that will encourage growth in the value of the token. In effect, you are gambling not so much on selling art for the creation of wealth, but for the value of DEIA to go up and create wealth for you that way. The token also allows you to gather data about those who hold/use the token, thus giving you a better understanding of your market, which in turn allows for smarter marketing strategies.
Is that a reasonable interpretation?
Yes I think that's a fair interpretation. 😁
Sweet! I sincerely wish you the very best. It is those who stick their necks out and try something different that set the bar for others to follow. May your tokens be worth several hundred dollars each in a few years.
ENGAGEtokens.