Theres an old saying that has been around well before cryptocurrency, and has been around about as long as money itself: “Never say never”. When I understood proof of stake, I knew right away my plan was to invest in all of them, and and did. Ive always been brilliant with money, but I had no concept of how to handle holdings that had 100% apr interest, 500% apr interest, 750% apr interest and even got as high as 10,000% interest per year (snowballs). We make our decisions based on our experience in the past. My experience is the past told me high interest is always good. What I really didnt take into consideration is I had never dealt with interest rates of this magnitude before. What I didnt know is currencies with ultra high interest rates needed to be handled a different way. Different than anything I had worked with before. What I didnt consider at all was inflation. That one factor trumps all other factors, and I thought that investments that had 750% per year could “outrun” inflation, while at the same time the 750% annual return was making the investment less valuable due to inflation. Consider this: everyone in the world wakes up tomorrow with 1 million dollars in cash in the middle of your living room floor. The biggest pile of benjies youve ever seen.
So now your RICH!!! Right? WRONG! Your more poor NOW, than you were before!! You are actually in the worst financial position possible! But wait, Ive got fat stacks, I mean STUPID money! Ya, and so does EVERYONE else, so they DON’T want your money! HUH!? Youll probably try REALLY hard to spend this money, but you wont be able to. Everyone in the world also has more than they can ever spend! Money/currency is ONLY valuable, when you have it , and most others dont. The more money YOU have the less value you see in it, the LESS money you have the more value you see in it.
So you needed to understand that before I go further. When new high POS coins were released their value was very high because you needed to get these coins, because they multiply like rabbits. The more coins you had , the more they created. As time went on, the money supply that started at tens of thousands over a few months ended up in the tens of millions of coins. Everyone that had those coins that paid a high price for them at the release of the coin, couldn’t give them away as everyone else that had invested in that coin ALSO had tens of millions of coins. Suffice to say the value per coin dropped over 95% in some cases.
So now we are at another stage. High pos coins have inflated , some are so inflated that there is no hope, and no fix. I will make it a point NOT to mention specific coins that are horribly inflated as this article is not about hurting a coins reputation, or value. Its to help you understand cryptocurrency better, so you can make better decisions in the future. I WILL however mention coins that I will return to, and give another chance , and my reasons why.
This coin will be classic and historic because it has such a strange twist , that it is unique. Here is the short version. From day 1 this coin was released it was plagued with technical issues. No irony there. It was one of the first ultra high pos coins that dates back to September 2013. It was so innovative that the technical issues continued for about a year. Most people that tried to mine it, gave up out of frustration. I think I tried over 10 times in that year, and there was always problems, from forks, to orphans, to the pools being down, wallet not working , you name it. After a year dev Noise23 from Truckcoin assisted the dev of Tek , who is Thundertoe, and cleaned up the bugs, and polished it. Today it works flawless, and better than it ever has. Here is the twist: The coin is well over a year old and has under 6 million coins. Who knows what it SHOULD be except to say that this number seems MUCH less than it is for a coin that rewards 500% interest a year! Other similar high POS coins that are 7 months old have more than 80 million coins, but again, I wont mention names. So the good news is because tek really has not been working correctly for most of its life, it has kept the coin supply WAY down, and has still lost much of its value, but were other similar coins have lost 95% of their value tek has lost about about 60% of it value, and seems to have stabalized. Most new high pos coins have a lot of interest and hype. Heres where the news gets better. Most people that were around the time when tek was released have moved on and forgotten about it. Those of us that have sha-256 are loving it right now because this is a pow/pos coin. The sha-256 pow difficulty is a mere 60k-70k . Extremely low for a sha-256 coin, AND I just checked the pos difficulty and its a mere :
PoS difficulty” : 0.00006103
Here is the chart for past 30 days from April 17th to May 17th 2015. Very stable AND 500% interest!
So when your tekcoins mature, they pretty much reward that hour as the POS diff is so low, as most others have moved on.
Hobonickels & Bottle caps from developer Tranz.
Im going to talk about these together, because 1st and foremost they are from the same developer Tranz, and they are VERY similar. Even their wallets look almost identical. The main difference is their POS system. Specifically their min stake time and interest earned in stake rewards. Here are the specifics.
Bottlecaps coin pos specifications:
- 15 day minimum stake
- 200% annual stake reward interest
- 1000 coin max reward per stake. Its about a 12,000 coin block using coin control.
Hobonickels coin pos specifications:
- 10 day minimum stake time
- 100% POS reward annually
- Max reward per block 250. To stay under this cap create coin blocks of no more than 3000. It is strongly advised to use the command: -splitthreshold=500 -combinethreshold=500 mentioned below.
These two did suffer from inflation, but now their price has been stable for the last 6 months. So what Im saying is , if the price remains about the same, you are now earning 100% -200% on your investment! Another reason these coins have a stable price is because of the developer Tranz. He is VERY active on his threads and is very trusted and respected. Here are some charts to illustrate: (click to enlarge):
The last inflation update was quite some time ago so here are the numbers of the last six month’s:
date block supply inflation
1-12-2014 1451032 7540709 7,9%
1-1-2015 1556265 8096241 7,4%
1-2-2015 1680359 8765283 8,3%
1-3-2015 1800260 9349593 6,7%
1-4-2015 1932062 9998550 6,9%
1-5-2015 2059867 10683151 6,8%
1-12-2014 758924 8289383 13,4%
1-1-2015 812457 9432382 13,8%
1-2-2015 869457 10728528 13,7%
1-3-2015 926375 12058324 12,4%
1-4-2015 989934 13572195 12,6%
1-5-2015 1049849 15210644 12,1%
1-12-2014 160714 53258893 53,6%
1-1-2015 190299 75120101 41,0%
1-2-2015 221286 101346810 34,9%
1-3-2015 250312 127669954 26,0%
1-4-2015 279701 155844433 22,1%
1-5-2015 308140 183508459 17,8%
HBN has the lowest monthly inflation as always. Not al all strange because it has the lower POS rate compared to CAP and HYP. Designed at 100% but these days usually somewhere around 90% due to an increasing network stake weight. The POS rate for CAP shows similar effects. Having a POS rate somewhere around 180% these days.
All of them also show a decreasing inflation rate. It means that the increase of the money supply is more or less stable. For HYP this moment occurred about 6 months ago when a lot of people started to hit the stake maximum.
So it all looks quite nice and stable. which is quite an achievement considering the age of their block chains, almost two years for HBN and CAP and getting close to one year for HYP.
Notes if you dont want to mess with coin control you can append your windows shortcut properties to include the following commands:
For hobonickels: HoboNickels.exe -splitthreshold=99 -combinethreshold=100
I like coins that have a stable price that have been around 1-2 years, AND have a high interest rate. They are very profitable and a lot more safe than new coins.