The last coin for this mini-series I’ll be talking about is Stellar Holdings, as an example for coins that suffered through hyperinflation.
You might ask yourself, what the hell is Stellar Holdings and why does Topkek want to talk about it?
Well, I wanted to show you guys a variety of Proof-of-Stake rewardsystems.
Starting with PIVX (very low inflation), going over to Bulwark (medium to high inflation), and lastly onto Stellar Holdings, which was very inflationary in the past.
Why Stellar Holdings?
So why did I choose HOLD when it comes to high APR coins? Well, because I have been in HOLD since the very beginning and I have lived through the ups and downs of such a hyperinflated coin.
It’s been very hard to stay in HOLD for so long, and I am still holding a small position in it, and I’ll explain why.
[Quick Disclaimer: I did not hold onto my whole stack of HOLD forever. I staked since the beginning, got a really big bag of HOLD due to the early inflation, and sold parts on pumps. Right now I still have a position in HOLD and will increase my stack slowly but surely, although I’ve taken enough profit already that my initial investment has been taken out by a multiple and I don’t plan on re-investing more than what I took out.]
Let me start with a little story of my own and my experiences with HOLD.
Well, I first bought HOLD on November 11th between 2400 and 3000 Satoshi.
If you take a look at the HOLD chart, shortly after, the price dumped immensely.
From 2.4k + Satoshi, it took a nosedive to around 1000 Satoshi, stayed there for a little while, and dropped sharply again down under 200 Satoshi and further down all the way to around 55 Satoshi as the Decemberlow.
Explaining the dump
Why was this the case?
Well, I can’t pull up the exact numbers since the old Interstellar Holdings website is down and the roadmap isn’t accessible anymore. (the old one that is, now they revamped to Stellar Holdings, migrated to a new website, completely remade the site and the blockexplorer etc.)
But, I still have the numbers in my head, not exactly, but close enough to tell the story.
The APR (annual percentage rate) on HOLD at the time was 5000%, so you can imagine that with an inflation that high, the demand couldn’t keep up with the quickly increasing supply.
After an initial phase of hyperinflation (5000%), the blockrewards got reduced and the APR still was super high, ranging between 500%-1000%.
Pair this hyperinflation with the overall bearish trend for Alts that we had until December 2017, the pricedrop was imminent and unavoidable.
Although HOLD has only launched in november 2017, the total supply at this point is already at around 850 Million HOLD.
The inflation was way to high for way to long, and the old devs didn’t keep their schedule when it came to releases, which didn’t help at all.
The demand simply couldn’t keep up with the increasing supply.
On top of that, apparently the founder and lead-dev (Azuraes) of HOLD also was sick for a long time, although I’m not sure if I should believe him, because he actually never told the truth.
Anyway, I think this shows how many issues HOLD had to face so far.
Why did I not sell everything?
Well, I’m gonna make a short list to explain exactly why, although I could’ve made more profit if I completely exited at HOLDs USD ATH in January. (Which I didn’t, truth be told)
- Didn’t put a ton of money into it (not my highest priority bag)
- I got in early, staked a ton ( Compound Interest helped a ton)
- Emotionally attached to the project (early “adopter”, exciting waiting for the pool to finaly get released, which never happened btw)
- Fan of staking, so a utility coin for a stakingpool sounded great to me
At this point I’m still staking a small bag, and slowly buying more and more whilst waiting for the masternode release.
So, if the team never did what they said, and the founder abandonned the project, why are you waiting for masternodes?
Well, a new team formed around HOLD to pick up the project.
The rewardsystem has been changed, the inflation has been lowered and the rewardsystem has gone from dynamic to static.
Blockreward now is 5000 HOLD per block, with a blocktime of 2 minutes, but the rewards will be reduced even more once the fork happens and Masternodes get implemented.
Lots of issues with the old team, absolutely no development at all
New team now, already delivered on new website and blockexplorer (Re-brand to HUZU comming)
Masternodes yet to come
Price absolutely dumped hard
No trust established because of the old team
- New team is way more engaging
Well, I’ve been in HOLD for so long and probably will be in it for longer if the new team follows up with their promises. ( I’m writing quite often with them, they seem very active and eager)
But, I can’t recommend buying such high APR Coins to anyone who isn’t experienced in Crypto and has alot of time on their hands.
Coins with such high APR are very volatile, and timing is even more crucial than on other coins.
These hyperinflated coins are extremely volatile.
Quick Example showing how crucial timing can be;
If you bought on December 17th 2017 for 65 Sats per HOLD and staked it for 32 days and sold on the high on January 25th 2018 at around 925 Sats, your profit would’ve been huge.
You already made 1423% on the pricedifference itself, but that’s not all.
Since inflation on HOLD was so high back then (I don’t know if it was 500% or 800% or 1000% exactly back then, but around those numbers, I’m calculating with the median right now which would be 750%) so in 32 days you would’ve accumulated 65% more HOLD, which makes your total profit reach 2347%.
On the same hand, you could’ve lost a ton of money aswell.
Let’s say you’re a beginner and don’t do your research, you see someone shill HOLD on Twitter, buy some, and don’t stake it, since you don’t know how it works and are clueless (Yes, people like that exist sadly).
You buy HOLD for around 4000 Satoshi, and not even 3 weeks later the price has dropped to 200 Satoshi, resulting in a -95% price decrease.
Of course these are extremes, but it can happen, and people should really be cautious when it comes to projects with very high coinemission.
Of course, if you are patient and pick up high APR coins at the bottom and stake them for a while and sell on spikes you can make enormous amounts of money aswell.
If I’m not mistaken that’s how Mr. Backwards has made alot of money with Buzzcoin for example.
I myself am curious to see what the new team can bring to the table, and if they actually release a fully functional stakingpool with HOLD acting as a utilitycoin, I can see HOLD (soon to be HUZU) picking up again in the future.
Wrapping up Low/Medium/High Inflationtalks
This wraps up my little write-up on Proof-of-Stake/Masternode Coins and how different these coins and reward mechanisms can be, which risks and challenges each can cause, but also how you could turn these risks into upsides.
I’m not an expert when it comes to Crypto, but I’ve done my fair share of staking/noding and thought it’d be interesting to just make a little article about it, and also share a little story about my ups and downs with HOLD.
This ends the section where I use coins for examples for low/medium/high inflation rewardsystems, but there will be more articles about PoS/MN Coins in the future.
Also, you can expect an updated article once there are more informations out about HUZU.