Thu, 05 Aug 2021

Cryptocurrencies like precious metals and other collectibles are here to stay. However, the only real purpose any crypto can hope to serve is to be a store of value and a hedge against the loss of purchasing power of government issued money.

Government issued money is being created at frightening speed supposedly to fight off the negative economic effects of the global Covid pandemic. However, the fact is governments have always created excess money ever since they had the power to do so. It's just easier than dealing with the discipline of controlling expenditure to match productivity. The unlimited supply of government created money has consistently resulted in the loss of its real purchasing power. While a dollar years ago is still a dollar today, it can only buy 1/20th of what it could buy. So in reality the former one dollar is now worth only 5 cents.

People who were smart enough to realize this held a portion of their surplus cash in limited supply assets like precious metals. Over time as government money lost its buying power, those who held precious metals were not affected. These smart people are some of today's wealthy.

With advances in computer technology, traditional limited supply assets like precious metals and art are being replaced with limited supply CryptoAssets because of the lower cost of storage and portability.

However, the challenge with CryptoAssets is the matter of supply limits and valuation. Of the thousands of cryptocurrencies out there only three have a limit on their total supply. These are Bitcoin (BTC), CryptRight (CR) and Ethereum Classic (ETC). BTC's limit is 21 million units, CR's limit is 10 million units and ETC's limit is 210.7 million. The rest have no limit to the number of units they can issue and subject only to a no duplication process can, like government issued money, be issued to infinite amounts.

All cryptocurrencies (both the limited and unlimited supply ones) with the exception of CryptRight are issued at an arbitrary price at launch with the proceeds going into the pockets of their creators.

Post launch their prices are supposedly determined by market forces. The truth however is quite different. Market prices of these cryptocurrencies are most often driven by media hype, celebrity endorsement and in some cases even false washed trade statistics. Under the circumstances their so called market price cannot be said to represent their true value.

The price of CryptRight at initial launch was higher than any other cryptocurrency. Why? The CryptRight price was not arbitrarily set. It was determined at launch, and continues to be determined, by a complex mathematical formula that takes into account several fundamental facts like the relative issue limits of its direct peers (BTC, ETC & XRP), the relative numbers of their units in circulation, market price etc.

CryptRight's price is further fortified through CryptRight being registered and rated, its issue limit being independently certified twice a year, its founders' undertaking to provide continuous liquidity for all three denominations of CR i.e. CR Maxi, CR Midi and CR Mini and finally the fact that proceeds of CR sales are invested in income producing businesses which in turn enables CR founders to support higher CR prices over time.

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