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The following post was written and/or published as a collaboration between Benzinga’s in-house sponsored content team and a financial partner of Benzinga.
Crypto investors have the potential to make a lot of money. With new and disruptive technology introduced daily, investors stand to make serious returns. Mainstays Bitcoin (CRYPTO: BTC) and Ethereum (CRYPTO: ETH) are performing well, and upstarts like Luna (CRYPTO: LUNA) and Avalanche (CRYPTO: AVAX) have exploded onto the scene.
But this potential upside comes at a cost — no market is as volatile. Traders are often burned as they get caught on the wrong side of the boom and bust cycle. As some are selling at the top, others are buying in as the market begins to fall. This zero-sum game leaves many with less than when they started.
The innovative project Seasonal Tokens hopes to change this. Seasonal tokens is the first multitoken project to use proof-of-work. The project is designed to create a circle of tokens that predictably shift value from one to the next. As one token begins to appreciate, the others fall relative to it. With this mechanism, traders theoretically should be able to always profit, avoiding the uncertainty of traditional fluctuations in value and speculative bubbles.
The tokens – Summer (SUMMER), Autumn (AUTUMN), Winter (WINTER) and Spring (SPRING) – together represent what the project deems a “money engine,” with the rising and falling values of each token fueling one another like the pistons of a four-cylinder engine. By controlling the supply and demand of each token individually, investors may be able to continuously extract value. This creates a cycle in which all can profit.
To accomplish this, a carefully balanced schedule is implemented in which the mining difficulties of each token are adjusted, followed by the farming rewards four months later. These are the two halves of the classic economic relationship of supply and demand. The mining difficulty affects supply while the farming rewards affect demand. Every nine months the token that was the easiest to produce from mining and least profitable for farming is reversed. It becomes the hardest to mine and the most profitable to farm. The other three tokens are adjusted accordingly, and the cycle continues.
Traders will be able to predict the optimal time to trade into the next coin, and farmers will be incentivized to buy the token that has now become “out of season” because farming for that token is now the most profitable.
With this mechanism, Seasonal Tokens hopes to have created a system in which all can benefit. If you’re interested in learning more, check out https://seasonaltokens.org/.
The following post was written and/or published as a collaboration between Benzinga’s in-house sponsored content team and a financial partner of Benzinga.
