The Future of $PHMN
Potential scenarios for development, market-making, and risk management
What would happen if someone were to try to sell a large amount of PHMN all at once?
It would not be possible to sell a large amount of PHMN, as no one holds a very large amount of it (as of December 23, 2022):
- 80% of PHMN is held in DAS
- 16% of PHMN is in circulation
- 4% of PHMN is in liquidity pools for ATOM-PHMN and JUNO-PHMN
What would happen if someone were to try to sell a large, but not an extremely large, amount of PHMN all at once?
In this case, we have a few protective mechanisms that I want to tell the community about! First, we have two tools that help the community stay updated on all PHMN movements:
- A Telegram bot channel that instantly tracks all PHMN movements and alerts users: https://t.me/PPHMN_whales
Thanks to this bot, we can see who and where PHMN is being sent in real-time! - A table with information on who has withdrawn PHMN from DAS and when these PHMN will become available for transfer: https://docs.google.com/spreadsheets/d/1pLVi-Eu8BX5YcCwhh_MP1zhCr3EsULVOmAW6-mRyQaM/edit?usp=sharing
Thanks to this table, we can find out on which day, at what time, and how much PHMN will become available for sale.
Secondly, by knowing this information, we can predict on which day and at what time a large PHMN sale might occur and prepare for it!
We send 20% of validator income to liquidity pools with PHMN.
Previously, we did this whenever we had free time, but now we are accumulating validator income to buy PHMN when the price drops.
The obtained PHMN is then sent back to the liquidity pools, and the person who sold the PHMN will no longer be able to repurchase it at the same price. The PHMN price will continue to rise.
Thirdly, PHMN can only be bought or sold in liquidity pools. And the mathematics of liquidity pools make each subsequent PHMN cheaper to sell and more expensive to buy. If an attempt is made to sell a large amount of PHMN at once, the slippage increases, making it less profitable to sell a large amount of PHMN.
Fourthly, since we only have two liquidity pools with ATOM and JUNO, a large PHMN sale in one of the pools will affect the price in the other pool. This means that the price of PHMN may not drop significantly in one pool, but will rather fluctuate within a certain range.
Fifthly, we have a community of supporters who are willing to buy PHMN at a fair price. If the PHMN price drops significantly, these supporters will buy PHMN, which will help stabilize the price.
Finally, we have a “decentralized team of market makers” who are constantly working to maintain a fair price for PHMN. They use various strategies to buy and sell PHMN in order to balance the supply and demand and keep the price stable!
This is our decentralized market makers: Community, Speculators and Sly arbitrators
- Community understands that the price of PHMN will only rise in the long term due to constant injections from validator income POSTHUMAN. They want to buy cheaper and send PHMN to DAS for participation in governance and to receive StakeDrops that will occur twice per quarter (8 times per year) starting in 2023 until the end of 2029
- Speculators understand that they can buy cheaper now, wait a little while, and sell at a higher price
- Sly arbitrators are not motivated by anything except for the appearance of a price difference between trading pairs. They launch trading bots, turning arbitrage into a powerful tool for comparing price differences. They know that the rate of growth of the PHMN price is higher than the rate of growth of the ATOM or JUNO price, which makes PHMN a profitable arbitrage tool.
Based on the above, I do not see any danger in selling a large amount of $PHMN at once.
The worst that can happen is a temporary decrease in price, which will quickly return to its previous position.
The seller will lose a large amount of $PHMN, which will be distributed among a large number of small players, and partly sent back to Liquidity Pools.
We have already seen such a picture at the level of $10. At that time, the first distribution from a small number of large holders to a large number of small holders took place:
At a level of $30, we got rid of almost all large players (big paper hands…):
Recently, “middle paper hands” have given way to a greater number of smaller players:
And… Looks like our “decentralized market making” is working!
The price chart can be viewed here:
https://tfm.com/juno/trade/analytics/tokens/juno1rws84uz7969aaa7pej303udhlkt3j9ca0l3egpcae98jwak9quzq8szn2l
Remember, this is not economic advice to buy or sell!
These are simply possible scenarios and a list of potential actions!
Any cryptocurrency carries risk!
Personally, I want to remind you that I am the second largest holder of $PHMN and at the same time, I am constantly reducing my stake by giving $PHMN to people actively participating in the development of the validator rather than selling it.
This means that I have less and less $PHMN, while the price of $PHMN increases.
It is in my personal interest to do everything possible for our idea of distributing the management of the POSTHUMAN validator to succeed and for the price of $PHMN to become such that even when I have 500 $PHMN left, that price is worth much more than when I had 8000 $PHMN.
As for the future, I can only make assumptions based on the information that is currently available to me.
Wish you cool holidays!
Let’s decentralize Decentralization!
