What is Grin?
There are over 2000 coins and token on Coinmarketcap. This week another one released its mainnet and hit the markets. But is it any different than the other ones?
Grin is defiently no money grab operation like so many other vaporwave tokens out there. Grin has had no ICO, no premine and no dev fee. It is simply powered by the community and relies totally on donations (and some swag they sell). So no shiny marketing videos and CEOs announcing announcements. It is a community driven open source project, which aims at offering useful tools and solutions to real world roblems, instead of making the CEO and the shareholders rich.
The MimbleWimble Protocol
MimbleWimble is a privacy oriented protocol with some interesting new technology. Everybody can look into the blockchain and see the adresses of transactions and the amounts of Bitcoins being transferred. But Grin is privacy by default and makes use of strong Elliptic Curve Cryptography to ensure privacy for the people involved and the amounts being send. It also offers high scalability, adressing an important real world problem. Scalability is a high priority issue, which must be solved before mainstream adoption. Grin is a step in that direction.
Store of Value vs Currency
Bitcoin is a highly deflational currency. It is capped at 21 Million Bitcoin. So if the demand rises the price rises. The 100.000s of per cent of the price increase sine it’s inception is a representation of that. That makes it a great store of value. Buy some and kep it, il will be worth more and more. If an asset has a limited supply and increasing demand, it becomes more and mor valuable over time, but limits its potential as a currency. If a person owns $100 of Bitcoin worth and expect it to be $110 tomorrow, he will wait until tomorrow to spend it. But then he might hesitate and wait till the day after, when he expects it to be even more. Also the bitcoin mining rewards are being halved every couple of years so the supply reaching the markets becomes less and less. Grin’s emission rate however is linear, meaning it never drops – no halvings. The block reward is currently set at 50 grin with a block goal of 60 seconds. So there is a constant grow of supply, meaning it is inflationary. That makes it a bad store of value but a great currency. Everybody who wants to invest in Grin should keep that in mind.
Grin Hitting The Markets
The first week when the mainnet was release and Grin hit the markets were pretty turbulent. News of big players investing 100s of millions of dollars into technology to mine Grin were hitting social media and a lot of small retail investors wanted to grab a pice of the pie, expecting the price to rise.
“There is (by our conservative estimates) 100 million dollars of mostly VC money invested into special-purpose investment vehicles to mine Grin.”
Eric Meltzer, PoW-Newsletter
So as soon as it hit the first small exchanges price startet to go crazy. Retail started buying, miners started to dump and there was insane volatility in the first few days (Over 90% drops and over 1500% pumps). After the first volatility outbursts, dust settled and the price starting to beome less volatile.
Article written by the High Frequency Tulip Trading Bot