I just tell you guys about other side of this burn project.
you guys can read my last posting about 'burn project'
In that posting,
I wrote that
this burn project will lower trading volume.
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now I want to explain what I'm thinking about burn
burn is just burn that is nothing...
if they want to make price going up , they have to make new ecosystem for LUNC not 'burn'
LUNC is saying every transaction will be burnt 1.2% (buy & sell ) even in CEX as well.
it sound nice.
but we should know the burning will be happened two times (sell and buy)
We need to know about supply and demand.
I bought 100 lunc in binance but the 100 amount lunc will be come to my wallet as 98.8 which is already burnt 1.2%(buy).
and I want to sell my 98.8lunc in binance but when I sell it 98.8 lunc , the amount of LUNC for selling will be 97.6 cus of 1.2% burn (sell)
many ppl are thinking about Lunc's value goes up when I buy cus of 1.2% lunc burn(buy).
so ppl are thinking my 98.8 lunc has same value as the time when I bought 100 lunc
( It's true if the number of people who bought it is the same as the day before. )
but even if the the value goes up , eventually when I sell it I will lose 1.2% profit (cus of 1.2% selling burn).
so whenever I trade this coin I will lose 1.2% profit
here has 3 situation to explain about supply and demand for LUNC
- if the market trading volume keeps same trading volume every day ( people whom wants to buy are the same as the previous day.)
- whenever ppl are trading LUNC they will lose 1.2% profit in every single trading
(as I explain above)
- if the market trading volume was lower than the day before (lower than 1.2%) ( Fewer people are willing to buy than the day before. )
- whenever ppl are trading LUNC they will lose at least over 2.4% profit every single trading
(when I buy LUNC, Lunc's value goes up 1.2% cus of burn , but trading volume has been reduced over 1.2%, It's the same situation as the number of people (1.2%) who want to buy has decreased, As there are fewer buyers, my Lunc is not more valuable than before I bought it. )
- if the market trading volume was higher than the day before (higher than 1.2%) ( Many people want to buy more than the day before )
- whenever ppl are trading lunc they will lose 0% profit which is no loss.
(I bought 100 lunc , It will be 98.8 in my wallet but the value went up 1.2%, even more than 1.2% ppl want to buy lunc , so my 98.8 lunc's value in my wallet aft trading , It's going to be equal to 101.2 values before I trade , so finally I can sell 100lunc price aft 1.2% (sell) burn)
so to keep same profit whenever I trade every day should have higher trading volume than last day
As a result, people will avoid trading.
Eventually, as day traders will disappear, the volume of trading for burn will decrease.
Eventually, people just buy it and hold it, and it's far from burn project,
now lunc has 6.5 trillion If it goes to 1 cent here, it's higher than the market capitalization of Bitcoin.
What I'm saying is that burn project is not such a big event, but it can actually reduce trading volume. We need to make more eco-systems, not burn, so that Luna Coin is actually used.
After the September 12 update, you'll see a price increase or a lot of trading volume at first, but eventually, there'll be almost no trading later.
I want to tell you not to be greedy if someone is benefiting now.
don't forget Doge coin , at that time everyone believed it will be 1dollor
It may be hard to understand because of my lack of English.
Please understand even if it's hard to understand.
It's just my opinion.
There are many factors for price.
I thought about it through this drop in crude oil prices. This time, a company that predicted less demand for people has cut back on crude oil imports As a result, crude oil prices have fallen. I put it in terms of supply and demand.