Grin fell 94% on its first day of launch, but investors remain optimistic about the Grin community

Monero, Zcash, and Ravencoin are following a similar path as Grin.

This article is from cryptopotato.com, written by Ali Raz.

Translator | Planet Daily Chaliang

Editor | Lu Xiaoming

Editor's note: Grin is a very hot currency recently. Grin, Bibox, BiDan, BigONE, Lbank and Bifu exchanges have already listed the currency. At 6 am on January 17, Grin was listed on Bifu Exchange, and the price soared to a high of $100, but there was no trading volume at this time. Half an hour later, the price of Grin began to fall rapidly. It was not until 1:30 pm that day that it fell back to $20. The trading volume began to increase significantly, and continued to fall to $6.17 within 24 hours, a 24-hour drop of 94%.

We believe that the initial high price may be artificial speculation, but the author of this article is optimistic about Grin and believes that it is normal for the price to rise and fall sharply at the beginning of the launch.

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On January 16, the very popular Grin mainnet was launched, and the first block was mined by F2Pool. The issuance price of Grin once exceeded 260 US dollars. Major exchanges have not yet launched grin, but Bibox, BiDan, BigONE, Lbank and Bifu have already launched the currency.

Then in the next 24 hours, due to the increase in Grin supply, the price of Grin coin plummeted, falling by 98%. As of the time of writing, it remained at US$7.5, which is about RMB 50.

It is foreseeable that the price of Grin will show such a trend after the launch of the mainnet, as history has proven that this is the only way for most high-quality projects.

The development paths of Monero, Zcash, and Ravencoin are very similar to Grin. Their early inflation rates were very high, and then the price dropped until the inflation rate dropped. So the price trend of Grin after its launch is within the foreseeable range. Although it is still falling now, it will still show an upward trend in the future.

Grin received a lot of attention and publicity during its development. As the mainnet launch date approaches, miners are increasingly looking forward to Grin. When the first block was mined, the market demand for Grin pushed its price to its highest peak. However, as mining continued and new coins continued to be created, the supply suddenly expanded, but the market demand was not fully released, so Grin began to depreciate rapidly.

But Grin's current price drop does not mean that Grin has no prospects. On the contrary, the explosive growth of research and analysis on Grin by the community, technicians and media in recent months shows that the crypto community appreciates Grin very much. Because of its privacy features and improvements, it runs more efficiently than some older cryptocurrencies. Despite the price drop, many investors are still optimistic about Grin.

The Grin team hopes to position Grin as a real currency rather than a means of storing value. Compared with Bitcoin, the amount of Bitcoin is limited.

Grin takes a different approach. Its issuance method is different from Bitcoin's constant total amount, and it is not a deflationary type. Grin has no upper limit on issuance. One block is produced in 1 minute, and there are 60 Grin in a block. And then there is nothing else. The speed of 1 Grin per second is maintained permanently.

Therefore, the inflation rate was very high after the main network was launched. 31.53 million coins were produced in the first year, and the same number was produced in the second year, with an inflation rate of 100%. The inflation rate in the third year was 50%, and the inflation rate in the fourth year was 33.3%... It dropped to 10% after the 11th year, to 5% after the 21st year, and to below 3% after 35 years. If the coins that are lost and can never be found each year are taken into account, it is estimated that there is no inflation.

Constrained by high inflation in the early stages, it is not conducive for early miners to mine. This also makes it easier for Grin to become a currency. It will not become a means of storing value like Bitcoin in the end, and it will not be able to enjoy high appreciation expectations, but people will be willing to use it rather than hoard it for speculation.

Moderate inflation is a good way to promote social progress, and deflation usually restricts consumption, so after 10 years of development, Bitcoin has deviated from the path of currency. The emergence of Grin provides a new way of thinking and is also a social experiment. As for whether it will be successful in the future, it remains to be seen.

Grin, like Bitcoin, is a network created by idealistic geeks. Unlike many projects that go straight to making money, Grin adopts a fully community-driven model. There is no ICO and no founder rewards. Before the mainnet was launched, the team did not carry out any token distribution or pre-mining, and relied solely on donations to maintain development. It also stated that it would not actively seek to be listed on exchanges. The degree of commercialization is low. This is also their way of paying tribute to Satoshi Nakamoto, and they do things very purely.

Grin chooses to be a pure payment and settlement token. Payment and settlement is the original function of blockchain and one of the few verified real needs. The Grin network will delete most transaction data and only retain key information such as the total amount, which greatly reduces the size and operation burden of the complete node, solves the potential centralization problem caused by the reduction of complete node operators for PoW consensus mechanism tokens such as BTC and ETH, and provides higher scalability.