Crypto-gravity: a proposal.
I’ve spent the last few weeks wondering if trading platforms are the best solution to give ERC20 (and Tokens in general) a representative price. Somehow, I found myself not fully satisfied with the demand/offer model for these crypto valuables. Reason being, I often see mouse-traps tokens being sold on the market on a pure speculative basis. At the same time, behind many other tokens lies a surplus value determined by human interaction, quality planning, functional Dapps (still on paper), individual work and collective network within a common ground provided by the kind of Blockchain they are minted and circulate on.
I got very excited as Simona Pop launched her BRLNCoin and the https://berlin.bounties.network/ as a platform open to everyone eager to “earn” BRLN by means of taking bounties. I’m highly supportive of local tokens (in this case, Berlin) based on Ethereum, which could represent exchangeable value for those portions of work often left un-rewarded, especially in a given creative and freelance scene. In the same way, I reckon LPTs (Livepeer Tokens) have a value that can be only determined by the level of their collective engagement in the so-called “delegation game” available on https://explorer.livepeer.org/.
Trading platforms like Radar Relay etc., as cool as they can be, cannot unfortunately grasp this fundamental importance, and will end up portraying the market’s mood more than the real ecosystem. In the end, we might see the blockchain becoming populated with 3.0 versions of Moody’s and Standards&Poors.
I was trying to solve this mind puzzle, when I accidentally bumped into a very popular equation.
The Gravitational Force Equation determines the force of attraction between two bodies as the quotient of the product of their masses and constant G, divided the square of their distance. This mathematical scenario represents in my opinion a theoretically perfect relation between, say, the purchasing power (value in fiat currency?) of a Cryptocurrency = m1 and the relative price of a Token = m2, where the value of the Token could be determined as follows:
Here I got so far as a non mathematician, non dev and non-economist.
I guess the whole point here is to be able to to translate the F*r(square) into a value that can be mathematically determined. Maybe the answer lies in the coding relationship of the token and its blockchain, on the token distribution across the network, on the number of transactions performed daily with that token or, again, in the ratio of token users against token hodlers.
I leave it up to the community of mathematicians and devs to understand if this proposal can make any sense, and the correlation I suggest can bring some stability and extra value to the ecosystem.