What's up, everyone? We're back with another great video about PulseChain. In this video, we'll tell you why PulseChain could destroy its market cap and what that means for the future of PulseChain. As usual, watch this video all the way through so you don’t miss anything.
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PulseChain (PLS) is arguably the most anticipated crypto in the market and investors are eagerly waiting for its release. Not a day goes by on social media where investors question HEX founder Richard Heart about its release date. For the uninitiated, PulseChain is Richard Heart‘s second token in the market and reports state that it could be launched anytime in 2022 or early 2023. However, no official word about its release date is made public by the PLS team since the very first launch date scheduled for May 2022 was postponed.
PulseChain, when launched, will be a new blockchain created by copying Ethereum and changing some of its codes. PulseChain aims to make transactions faster and cheaper for its users. The upcoming blockchain will provide affordable gas fees when compared to the Ethereum network. The PulseChain team will not just copy the Ethereum codes, but also copy codes of NFTs and other tokens that are on the Ethereum network.
The upcoming blockchain’s native token will be PLS. Also, all the existing ETH on the Ethereum network will be converted to PLS on the Pulsechain network. It is reported that the supply will be inflated by at least x10,000.
Their website states, “The main differences are speed, cost, Deflation, and efficiency of the network. Capable of hundreds of transactions per second vastly outpaces Ethereum’s 13. Removing the need for the expensive computing power of PoW while maintaining a high level of security.”
Nonetheless, there’s no doubt that PulseChain will reach a billion-dollar-plus market cap in a short period. PLS could also boast of a large number of holders, but the market condition might dictate its moves after release.
Now, is there any chance that PulseChain will destroy its market cap? Before we answer that question, let us explain the concept.
Even though the market capitalization of a project is still considered the most important indicator of relevance, the underlying concept is often criticized. This is because the market capitalization of a crypto-currency more or less reflects the popularity of a coin in the longer term.
Large-cap cryptocurrencies are generally considered safe crypto investments. Investing in large-cap coins is generally a conservative strategy. These coins are likely to be less volatile than other crypto-currencies, but still more volatile than traditional assets like stocks.
Now, mid-cap cryptos are more volatile but also have much more growth potential than large-cap cryptocurrencies. And small-cap crypto-currencies are often extremely volatile and considered a very risky investment, although they sometimes have strong short-term growth potential. However, be aware that they can also crash, literally from one minute to the next. There is no doubt that once launched, PulseChain pump quickly. Many investors say that PulseChain will launch with a strong market cap and that after making a few Xs in the short term, it will either stabilize or crash. Well, they are wrong. PulseChain is designed in such a way that it will make the public understand that market capitalization does not matter. Richard Heart believes that a market capitalization is a made-up number and that it is literally useless because neither investors nor traders make any money from it.
According to him, the numbers are very often manipulated in order to control the market. And many people agree with him. This is the case with Johnny, a hex holder and someone who understands the crypto world very well.
The market cap is unnecessary for many reasons.
Market cap is about price, not value. It does not reflect the value of the company or crypto asset you're investing in. This is a fundamental distinction that is often overlooked. Price is what you pay for a coin or token, it has nothing to do with what you actually get aka value.
It’s an indication of what people are paying for something, and this is usually driven by irrational sentiment, which has little connection to an asset’s real value. Assuming that whatever the market is willing to charge for an asset is equal to what it’s worth is a big mistake.
Think about the gains experienced by crypto assets in the last few years. Sometimes overnight, Bitcoin or Ethereum has added billions to its market cap. But what actually changed? Did they get more users, launch a new technology, or achieve more mainstream adoption? What change occurred to the underlying fundamentals?
All that happened was more investors were willing to pay a higher price. In the vast majority of cases, no underlying value was added to these assets, just more sheep willing to pay higher prices, which resulted in the market cap skyrocketing. As the market cap skyrockets, more sheep mistakenly believe the asset to have increasing value, and the cycle continues.
Market cap is about price, and the price has NOTHING to do with value. It's just a multiplication of the last transaction price by the circulating supply, and, therefore, has no use when trying to assess value. Market cap only reflects the last transaction price
The market cap of a cryptocurrency or token is about price, not value, which misleads many investors. But it’s more than that. Market cap only reflects the last transaction price multiplied by the circulating supply.
If, for example, a market cap rises or falls by $100 million, it doesn’t mean $100 million has entered or exited from the asset.
Let's say you create a token with a 10 billion supply, develop a simple ERC20 contract and deploy it on Ethereum, and an exchange. you then convince your friend to buy one of these tokens for $1. Boom there you have it. A token with a $10 billion market cap. Congratulations to you! you have now created a promising new project that has received lots of investment.
As you can see, this is all absolute rubbish. It doesn’t mean $10 billion was invested in my token, and it in no way helps in understanding its value. Market cap only serves to obscure and create a false sense of value when actually it’s just a multiplication of the last transaction price by the circulating supply.
If we take this example even further. Let’s say your friend turns around and sells the token you made for $2 to someone else. The market cap would go from 10 billion to 20 billion, even though only $2 has changed hands. So, if you see a token with a $1 billion market cap, it may have only $10 or $20 million invested in it. If it collapsed and went to zero, investors would only lose $10 or $20 million, not $1 billion.
The bottom line. Crypto assets with a low float and high total supply can game the system and make themselves look valuable. Market cap and changes in market cap are meaningless and deceiving.
So even if PulseChain's price goes to a single penny, we'll be looking at a number that is just too big. And it will still be a good time for the PulseChain community to see that the market cap is designed to be broken and that they will never fix it because they literally have an advantage in a broken system.
Richard Heart saw the flaws in the system and designed PulseChain in such a way that it will crush the market cap, even of Bitcoin, and reach the top by knocking over other coins because it will have more units at a price that will continue to rise because of all the things that PulseChain is trying to solve. The result is that not only will Market Cap be destroyed, but PulseChain will end up making more millionaires than anyone else, especially those who keep their Pulse chips from the beginning.
Now, do you think PulseChain will destroy the Market Cap? As always, don't forget to share your thoughts and opinions with us in the comments section below.
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