ambcrypto.com
Bitfinex’s first IEO started with the Ampleforth [AMPL] token sale which raised approximately $5 million in 11 seconds. The token is confused by many as a stablecoin, but it isn’t one. However, the price of the token is balanced around an equilibrium price target and holders of the token receive more tokens if the price manages to go beyond the specified equilibrium and stays there.
The concept of the token is quite different from any other crypto in the top 10 cryptocurrencies’ list. MapleLeafCapital, a proxy developed to maintain the quality of block producers in the EOS ecosystem, opined on this token and addressed some issues.
The tweet thread stated,
“Whilst with a novel token mechanics, it [AMPL] is anything but stable (faaaar from it, and may not be so even at scale). The somewhat misleading signals might fool many initially, but it’s great trading sardine!”
As seen in the whitepaper, if the price of the token increases over the equilibrium target, holders of the token will receive extra tokens every day until the price stays above the mentioned level.
Maple Leaf Capital addressed this issue, stating,
“I can see this make for a great narrative – a double-kill so to speak for retail – not only can the price pump, but your holding size also increases. At $6 mm USD float, it really doesn’t take much at all to (a) pump and (b) keep AMPL at above $1.05.”
The price of AMPL token, at press time and as seen on Ethfinex, was $1.72 and it had a trading volume of $660,000. Additionally, since the token was just recently launched, it would have a lower trading volume and market cap. This implies that the price of the token could be easily manipulated.
According to Maple Leaf Capital, it would be meaningful, “only when AMPL scales to say billions of dollars, the wealth it takes to deviate AMPL away from 1 would increase significantly, and only then would the price be more “zoned” around 1; but the team laid out no roadmap on how to get there.”