I recently sold 100% of a fairly large bag of OHM at $1,050 having made 5x. The price slide seemed obvious from a TA perspective and so many forks were clearly muddying the water. Right now I am well ahead with OHM at $715 and still tumbling. I don't believe you will see price improvement until the APY reduction is done, simply due to uncertainty about what's on the other side. I did not have confidence that rebases would outpace the falling price and so far it seems that I have been correct.
Have you guys looked at Hector Dao the Fantom OHM Fork? Its APY is like 500,000 with a price around $200. APY will come down, but I am a big fan of Fantom.
Depends how much new money comes in. If they're paying 0.298% reward per day on a $3.5B market cap that's $10 million per day of new money needed so that the rebases provide that reward in real not just nominal terms. That $10 million of new money assumes no selling.
If you sell the rewards, somebody needs to buy them so you require additional new money entering to match the amount sold (or the price drops).
So they should rephrase it to "stake, chill and take profit then" since that seems to be the optimal strategy for big ohm holders. Leave the large stack staked, and just sell your reward to derisk over time.
This is one of the great uncertainties about OHM (and all the forks) which drives up the investment risk. Nobody can really say with certainty what the optimal strategy would be in the face of APY reduction or falling price. I have heard credible discussions which theorise that supply expansion and profit taking would see price would fall to a much smaller multiple of RFV (meaning OHM at $200 or so), and I have also heard arguments that price would RISE to something like $5,000 over time as more protocols and individuals flock to OHM as a volatility hedge as the protocol matures. It's totally unclear which of these scenarios is more likely which raises near-term risk simply due to the uncertainty.
It's a ponzi with extra steps
I recently sold 100% of a fairly large bag of OHM at $1,050 having made 5x. The price slide seemed obvious from a TA perspective and so many forks were clearly muddying the water. Right now I am well ahead with OHM at $715 and still tumbling. I don't believe you will see price improvement until the APY reduction is done, simply due to uncertainty about what's on the other side. I did not have confidence that rebases would outpace the falling price and so far it seems that I have been correct.
we do a little staking & chilling
great article guys, hits on a lot of the questions I've had
Have you guys looked at Hector Dao the Fantom OHM Fork? Its APY is like 500,000 with a price around $200. APY will come down, but I am a big fan of Fantom.
So what would happen if the biggest OHM holders just stay staked and sell their rebase reward? Would the price bleed to $1 over the course of 1 year?
Depends how much new money comes in. If they're paying 0.298% reward per day on a $3.5B market cap that's $10 million per day of new money needed so that the rebases provide that reward in real not just nominal terms. That $10 million of new money assumes no selling.
If you sell the rewards, somebody needs to buy them so you require additional new money entering to match the amount sold (or the price drops).
So they should rephrase it to "stake, chill and take profit then" since that seems to be the optimal strategy for big ohm holders. Leave the large stack staked, and just sell your reward to derisk over time.
This is one of the great uncertainties about OHM (and all the forks) which drives up the investment risk. Nobody can really say with certainty what the optimal strategy would be in the face of APY reduction or falling price. I have heard credible discussions which theorise that supply expansion and profit taking would see price would fall to a much smaller multiple of RFV (meaning OHM at $200 or so), and I have also heard arguments that price would RISE to something like $5,000 over time as more protocols and individuals flock to OHM as a volatility hedge as the protocol matures. It's totally unclear which of these scenarios is more likely which raises near-term risk simply due to the uncertainty.
Good Analysis read
Isn't it Brain who is the one that hold a position in OHM?
Brain holds as well however Owl (we think) owns as well now.
Yep I bought after our first article on it