Helios has some wild swings

Image Source: Dall-e

Helios has a great burn utility

The whole idea behind HELIOS is that is a deflationary token. There is a limited pool and it needs to be burned in order to be useful. That means the supply is dwindling each and every day.

Every token has been minted and every day tokens are being burned so the actual supply is getting smaller and smaller.

In addition to that there is demand each and every day. The reason being that burning tokens brings the attention of the helios.voter. For the Great Little Dragons that means that Hive account@hiveabbyftp (the curator) can burn HELIOS tokens to call in a much larger upvoter than he could do himself.

What happens when there is limited circulation and constant burn?

Now very few people are trading the token. Add a few bots onto that and that means that a small number of trades can have an outsized affect on the token's value. Hive account@hiveabbyftp used external funds to purchase a pool of HELIOS to fuel growing the community over time. Sure right now the number of people here is limited but in the future we are hoping to get everything sorted and more people to upvote around here.

That support from one purchaser pushes the HELIOS token up to the 3 HIVE per HELIOS range which is quite a jump considering it was at 0.17 HIVE per HELIOS just a few months ago.

Then the question came...
.... Is a high HELIOS price good for the burn mechanics. The higher the price the fewer HELIOS need to be burned to utility and the more people can siphon off helios.voter votes while spending very little. Hmm.... that isn't awesome. Better to have more people burn tokens now and then the major holders can siphon more value later....

..... but if the token goes too low than everyone has to pay to much now which kind of sucks. It is a weird balancing act.

So, purchases from the GLD group dropped for a little while to allow the token to float a little further down so we can accumulate more moving forward.

Still ...

Going from 0.17 up to just over 3 and then back down to just over 1... seems like a bit of a wild ride. One that will very likely happen again. Right now there is only a 90 token buy wall keeping the value from dropping by almost half. Then again there is only a 328 HIVE sell wall keeping it from doubling.

The price is easily manipulated.

I hate to say it but one actor can have an outsized affect on the value of the token. If Hive account@hiveabbyftp just dumped a portion of his coins the price could be right back in the 0.20 price range in short order. Then again... another decent sized buy order and it could be over 2.0 just as fast.

It is mind boggling to think that a token could drop to 0.2 and then go to 50x its value within 24 hours with just a few decent sized trades! However, that is what happens with thin liquidity ... especially when the underlying token is in very short supply and the number of sellers is small.

I will admit though, I am curious who has the largest sell order on the list. Are they a whale trying to keep the price down or at they just trying to liquidate and take a profit?

Wish I knew but at this moment? The GLD group will be placing additional support bids around the 1:1 Hive:Helios point and then figure out a strategy going forward.

Still bullish on HELIOS long term
... but watch for volatility

and if you understand how its burn mechanics work it does make the token far more interesting :)

Thanks for reading