While the EOS trading price is highly inflated compared to utilizing the token distribution contract, the volume and price that it has achieved confirms my belief that this will be the biggest token distribution ever.
EOS has been available for trading for several days now, but there is still almost a year before a live platform and network is expected to launch. There are over 340 different 23 hour distribution periods before the end of the distribution, so in reality there is no benefit to buying now compared to in 6 months for a long term position. The volume on EOS trading is being driven by numerous Chinese exchanges, with one exchange accounting for over 65% of the total volume with a 24 hr volume of nearly 140 million USD. Many people including myself expected the token distribution to be extremely hyped and raise a huge amount of capital, but I am surprised at just how much interest and attention there already is surrounding EOS.
The price level of 3$ is wildly inflated compared to the price levels of all of the distributions so far, and I really can't see any reason why I would choose to acquire my stake on an exchange compared to utilizing the distribution contracts. Most of the volume that has likely driven the price level so high has been coming out of China, which really isn't surprising. I do wonder how much of the volume could be attributed to individuals simply trading on the margins and how much comes from individuals wishing to purchase tokens for the purpose of long term investment. I am beyond excited for the EOS project and learn more and more about it every single day, but I simply can't justify investing at the current time. I have been building up my Ether holdings over the past several weeks and will continue to do so, but I believe that we will see much more reasonable price levels several months from now.
It may seem hard to resist investing now or buying from an exchange, but I urge you to at least consider watching the activity over the following months.
I think that we are seeing a classic case of FOMO (fear of missing out) in the EOS distribution as well as its trading on exchanges, but there is a good chance the market and investment will stable out over the following several months. Many ICOs have used a specified number of coins at a specified price, but EOS uses a market determined price level which leads me to believe that the initial distributions likely experienced an inflated price compared to what we will see in the upcoming months. I do believe that even at a 3$ price level EOS would still be a very great investment in the long term, but I see no reason not to try to get the most 'bang for your buck'. Considering that there will be a total distribution of 1 billion coins, EOS will likely be able to achieve an incredibly high market cap before the platform even launches.
I'm not telling anyone what to do, but I do believe that waiting several months before making the majority of your investment will be the most beneficial method to acquire stake in the EOS platform. Another thing to consider is that the EOS distribution contracts are powered by Ether, meaning that the price level of the EOS tokens are directly tied to the current price level of Ether. I'm not sure as to whether Ethereum will be able to achieve long term success and adoption, but I definitely think that we will continue to see a rise in the price level of Ether over the following months. By acquiring more stake in Ether over time I believe that I will be able to not only invest when the 'price' of EOS is lower, but also when the price of Ether is higher than it currently is.
The EOS platform is definitely something to get very excited about, but that doesn't mean that there is any reason to pay an inflated price for stake in the platform before it even launches. While I understand if individuals want to be involved in the token distribution contracts at this stage, I strongly urge against buying on an exchange for the purpose of holding the tokens long term. EOS has gained more traction and attention that any other platform has before, and that's the reason why I believe we have seen such abundant investment and activity so early into the distribution. FOMO has been a big driver of many investors for a long time in the cryptocurrency market, but with the length of the distribution contract I don't think that having a FOMO mindset would be beneficial in any way. My goal is to try to acquire as much stake as I can at the best rate that I can, and I will do that by buying small portions of my stake on a daily basis over a long period of time. This will enable me to get my stake at a median price level, and will likely be the safest and most effective method of acquiring stake.
Please note that nothing discussed above should be taken as financial advice, and are simply my personal opinions. I really hope that you enjoyed this post, and as always I urge you to leave any comments, questions, input, ect. in the comments below! Thanks for reading!
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