How closely does the corporate progress the IOTA team makes translate to IOTAs valuation? How...


How closely does the corporate progress the IOTA team makes translate...
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Mraiblu
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I am extremely excited for the IOTA foundations current and future projects. However, I am having trouble understanding how the success of the foundation correlates to the success of the currency's valuation. My current understanding is only an indirect correlation that goes like this:

-) IOTA makes extreme progress as a currency for the corporate and IOT worlds.

  Companies need to use IOTA to participate in programs like the IOTA marketplace.
  The value of IOTA increases as companies and people use the currency as a means of payment for the services

Are there other, more direct ways that IOTA's demand be systematically increased with the success of the foundation other than this? Thanks for any knowledgeable response.

Winston
Winston
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Mraiblu - 18 Jun 2018
I am extremely excited for the IOTA foundations current and future projects. However, I am having trouble understanding how the success of the foundation correlates to the success of the currency's valuation. My current understanding is only an indirect correlation that goes like this:

-) IOTA makes extreme progress as a currency for the corporate and IOT worlds.

  Companies need to use IOTA to participate in programs like the IOTA marketplace.
  The value of IOTA increases as companies and people use the currency as a means of payment for the services

Are there other, more direct ways that IOTA's demand be systematically increased with the success of the foundation other than this? Thanks for any knowledgeable response.

@Mraiblu
Good question, and this can be a fun topic for discussion. There's no reason I, or anyone else would have a better answer to this question than you.

It seems like it would all going to depend on how you define direct vs indirect impact on valuation. There's only one way to increase an asset's valuation: by increasing demand more than supply. So you need more people buying than selling, on aggregate, over a long period of time. Anything that can lead to this would increase the value.

Then think about the reasons why people might buy a cryptocurrency. It seems like 99% of people buy them for speculative/gambling purposes in hopes of appreciation due to others who are also speculating. That can lead to excess demand, and thus increasing valuation. However, the only sustainable way of creating demand for an asset is by making it useful to a variety of market participants. The more people who need to use it on a daily basis, the more organic the growth of the underlying valuation. If businesses and technologies begin to incorporate IOTA into their settlement and data transfer protocols, tokens will be used more often on a daily basis. Customers will need to use whatever medium of exchange is selected for by the products they purchase. And so on.
 
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