ShareRing’s Tokenomics is a brilliant piece of game theory. It motivates people to invest in SHR. It motivated me to invest. But first I needed to wrap my head around the tokenomics, dig into the mechanisms, and see how it ticks. Only then did I feel compelled to act.
Now that I’ve digested and come to an understanding of it all, I’ll share my findings with you.
Let’s dive in. Let’s explore ShareRing’s Tokenomics and why it matters for you and me.
ShareRing’s Tokenomics — Why it Matters
ShareRing is more than their tech. While ShareRing’s technology is certainly a marvel in its own right — and we’ll cover that briefly below — their unique tokenomics is the selling point that matters for you and I.
It matters because their tokenomics — in addition to their tech — answers the biggest question I have when doing my due diligence on a project. The big question, and I’m sure you can relate, is always: how do transactions on the blockchain benefit me and other token holders?
To find the answer, I dug into Sharering’s flowbacks, low supply, holding incentives, token utility, and all the goodies that translate to price increases for me, rather than company profits that never reach the community’s pockets.
What I found, in a nutshell, is that Sharering’s tokenomics turn their business success(transactions) into value for holders. The merits of this token design have been recognized by numerous high profile hedge funds such as: Alphabit, GDA Capital, Alpha Sigma Capital, and more.
It certainly boosts my confidence to know people with much more at stake than myself found it worthy of investment.
ShareRing’s Tokenomics are designed to reward those who stake SHR and those who HODL it. How?
When you hold and stake your SHR, you earn flowbacks. Not only do these flowbacks give you more SHR, they also raise the price of SHR — which raises the price of all the SHR you’re holding. The more you hold, the more you earn. And it’s all thanks to …
The ShareLedger is SHR’s clever blockchain. And it’s cleverness comes from the fact that it is built to integrate with a very wide variety of APIs (API = a way for software programs to talk to one another).
ShareRing is coming out of the gate strong, using their APIs to process millions of transactions per partner. This would make it one of the most active blockchains in crypto — all within its first year of being live — and there are no signs of slowing.
Companies, businesses, and people can use ShareLedger as the backend infrastructure to power their business. They use ShareLedger because it can save them money.
A real-world example is easy to find: the e-visa system in Thailand and one of it’s providers — Gateway Services Ltd. SHR is also partnered with Dhipaya –Thailand’s biggest insurance provider — so they can bundle e-visa with mandatory insurance that’s required by Thailand laws.
Gateway Services is one of the two accredited e-visa providers in Thailand and is already using ShareLedger to save $100,000 per month in manual processing costs. That translates into more SHR in staker’s wallets. Every time Gateway Services processes an e-visa they use ShareLedger. Processing the transaction incurs an average fee of $0.035. That fee is used to buy SHR off the market. That SHR is put into your HODL bag of staked SHR. Ta-da! Flowbacks.
Now that $0.035 didn’t seem like much to me at first, but then I took a look at the big picture. The insurance companies are predicted to have 20 million transactions in the first year alone, increasing to 45 million in year 2.
20,000,000 x $0.035 (average fee) = $700,000
That means SHR’s flowback API will take that $700,000 in fiat, buy SHR with it from the open market, and deposit it automatically into the staking wallets of SHR users everywhere.
Every last cent of this $700,000 will go to buy SHR off exchanges at market rate. This $700,000 is from one company. Imagine how much will come from the 28 partners that ShareRing already has but are currently under NDA.
Then we take the above observation and add to it the next game-changer: the fiat multiplier. The fiat multiplier is the observation of the phenomenon when fiat is on-ramped into crypto, the effect of the increased market capitalization of the coin you’re buying is multiplied by X times, in GDA capital’s estimations, it’s 15x, by JP Morgan’s studies, it’s 117x.
The 117x multiplier is based on the 2017 bull market figures. So that effectively means in a bull market, you can adjust the conservative estimates to the 117x number by taking 117/15= 7.8x,
So with the 15x multiplier, GDA capital gave SHR an intrinsic value of US$0.114 SHR based on revenue. In a bull market, you can multiply that by 7.8x giving SHR a US$0.8892 intrinsic token price.
SHR flowbacks are non-inflationary
The vast majority of Proof-of-Stake projects are inflationary — they pay for their staking rewards by increasing the supply. Ethereum is a good example, the foundation and code keeps producing more and more ETH. So even when Ethereum 2.0 comes online in 2021 or 2022 or whenever they get around to it — the people who stake ETH won’t really be earning all that much.
So what if I earn ETH on my stake when more ETH is just minted and dumped on the market? There’s no market pressure because the supply rises right along with the amount I earn. By contrast, I found that SHR has a fixed supply. SHR is non-inflationary.
So when Gateway Services (or any partner) uses ShareLedger, the API takes the incoming fiat payments and purchases SHR automatically off the exchanges, then distributes that SHR to stakers (like me). In other words, the users or businesses pay with fiat and it’s converted automatically to pay for their transactions.
Do you see what’s happening with these flowbacks? Instead of creating more supply, these flowbacks are in fact creating LESS available supply. They’re removing SHR from existing supply order books and putting it into the wallets of stakers and masternode operators.
It’s the simple law of supply and demand. The SHR API will use fiat money to buy up SHR for flowback rewards. Less supply = higher price.
And speaking of demand, tell me what happens when more and more people realize this clever profit mechanism and want to stake and run masternodes? Tell me what happens when they demand SHR and are willing to pay more for that SHR just, so they can get those rewards?
This is why SHR is a gem and can easily outpace other Proof-of-Stake coins in 2021 and beyond. It’s a really efficient/clever way to turn outside fiat money into SHR for holders, translating success in business to value for token holders like you and I.
And when the circulating supply decreases as more SHR is locked up by masternodes and stakers and hodlers, the SHR supply will be considered “low float”, meaning the available amount to buy is very low, leaving little on the ask side of the books. That’s a classic lead into faster price increases when the demand rises.
If you still need convincing, then here are a few more reasons as to why ShareRing is a good buy right now.
- Masternodes and staking will be live in approximately 1-2 months.
- Lbank just announced as an SHR exchange today plus 1-2 more coming very soon (and we all know what new listings do to token prices, especially Asian exchanges).
- Staking rewards will be approximately 5-8%
- They are doing a LOT. Just see my previous article on why they pumped over 600%, shortly after releasing it was already outdated putting up a 1000% increase from the previous month’s lows.
Bottom line: Expect fireworks. I do. It’s why I kept digging into SHR and learning and buying more — because the more I learned, the more I wanted to be part of this moon mission.
Now it’s time for you to dig deeper. Visit ShareRing. Learn about the ShareLedger. Do whatever it is you need to do so that you have the answers you need, just like I did.