Community Q&A 2020–10–15

Hello StakeHODL’ers!

Etienne Gagnon asked a great question. I felt it deserved a separate post as others would undoubtedly have the same question. The question was if the ERC20 token participates in the value increase or not.

The ERC20 token does not participate in the value increase, nor does it raise in value. The token does not participate in the redistribution of Ether or HODLC. Once a token is issued, it maintains a value of US$1 worth of HODLC value. The smart contract always repurchases the token for $1 worth of HODLC.

The token was created for three purposes: a convenience, a utility, and a tool for upcoming features.

Convenience: The token was made to facilitate the exchange of HODLC and as a utility for upcoming features. It was not designed to be used by HODLers for value acquisition and increase. It was intended for exchanges, such as payments and value transfers.

Utility: The focus of the project remains HODLC. The token was never intended to or created to increase in value. It was made in the format of a stabletoken to reduce speculative pressure and facilitate understanding, listing and market-making. It was also made to generate value for the main network, thus incentivizing participants to convert back into HODLC. Once listed this way, the token will benefit from arbitrage pressure to fill the gap, like many stabletokens, reducing the price discovery and manipulation possibilities. Even in extreme cases where some volatility would arise, it would not affect the value of HODLC itself.

Tool: The token will also serve as a utility token in the upcoming HODLSwap features. However, if I expand on that at this point, I’ll never finish writing this post.

Buyers of this token will always have more value by converting it back to HODLC. However, they may choose not to as there are many reasons to trade or own stabletokens.

Ultimately, the token could not be used at all, and it would change nothing about the network. Conversely, it could be used a lot, and it could generate bonuses for HODLC owners. If a significant portion of HODLC’s were in tokens, it would only generate more substantial redistribution for HODLC owners. We consider this another good incentive to keep your stores of value in HODLC rather than tokens.

I hope this answers the question. If you have additional questions, please let us know.

HODLCommunity proposes the vision of a sustainable economy for anyone, either individual or organization by the usage of a disruptive new algorithmic token