To readers: It is NOT a complaint about what Staci said but an attempt to highlight and communicate an important issue.
From the interview today
I don’t know if I should take it as an honest answer when the foundation and inc are highly relying on selling Algos and there has been constant talks about getting Algo to top 10 and eventually top 3 coins. How could that be even possible without a significant price increase?! Also how is it aligned by encouraging Algo holders to use Algo as the main collateral in the Algorand DeFi ecosystem?!
There have been lots of good news and improvements about the ecosystem growth. Moreover, the foundation and inc have taken steps to be more financially responsible by establishing CFO roles and some cost cuttings. More importantly there is an increased awareness about the importance of supporting and growing the community.
Having said that the constant selling of Algos by inc and the foundation into every positive price momentum has exhausted bids at every level and pushed the price lower. Just last week ~50M Algos were sold by the foundation and inc in the market. I’m not sure who they think is the buyer on the other side but likely someone from the Algorand community (if not shorts who conveniently frontrun the dumps) who believes in the project future and has continued to support the project by buying Algos. At this point, the Algorand community is like a body that has already lost a lot of blood and as soon as there is any slight improvement in its conditions, more blood is taken out of it. Ironically, this is a self-feeding negative loop. As the price goes lower, not only the community gets more disappointed but more Algos need to be sold to fund the orgs operations.
I’d argue the current position of Algorand and its constant disappointing price action (just look at ALGO/BTC and ALGO/ETH relative prices, overall trading volume, etc.) creates a huge missed opportunity cost, which its negative impact could be more than all positive efforts in the short and medium terms (Who would want to invest, build and promote coin #41?! Yes, we all know that Algorand is better but that is not how things are perceived in reality. Even if a CEO or project lead knows about it, choosing Algorand takes a lot of courage). The core issue is not the past but the fact that it seems it will be the same way for the foreseeable future (next few years) unless something is done about it NOW.
You may disagree with the problem statement and therefore don’t see any need for addressing that. Please feel free to write down your point of view in a comment. However, if you agree with the issue and how much it hurts the Algorand growth then here are two ideas (please feel free to add more in the comments):
- Both orgs become more disciplined in their structured selling: set a minimum price (not a threshold that constantly moves lower) and remove human decisions about when and how much is sold at what time. (It sounds really smart to sell just before the debt ceiling deadline where your own community has locked their Algos in governance, right?!)
- Burn 2B Algos (you can debate the actual amount). The price increase should compensate for the reduction in the number of Algo holdings by the foundation. One important impact of this is that all major and large crypto players who understand the advantages of Algorand but think they still have a few years to get into it have to make their decision much sooner.
No solution would be perfect but the question is how they would impact Algorand future in one year, two years or five years given all their pros and cons
@Massimo I hope these ideas (or other ideas that address the same concern) are seriously considered by the foundation.
14:27 “We at the foundation don’t think about price at all!”
OK. Fine. The question is, why did she made that utterance:
- because she doesn’t care – not probable
- because she doesn’t have the necessary influence – not too probable either, but may be the case… I think here about the Early Backers, Node Runners, etc. – which I think is far from transparent.
So, who should invest into Algorand?
According to moneymade.io,
"… it’s too early to tell if Algorand has a future. Algorand is an organization that laid the foundation for a promising project, but it will take time before the major flaws will be straightened out and Algorand becomes a viable DeFi network. "
When I showed Algorand to my friend, who is an Ethereum investor and developer, he told me to sell all my Algo as soon as possible. I see now that he was right. So my advice to small investors: do not wait until your investment’s worth will be decimated.
P.S. @awesomecrypto , I bet you won’t get any decent answer, neither from Algorand Foundation, nor from Algorand, Inc. Reason: Silvio and Staci is not a forum member
Group resource sharing is about to be released any minute now: Ep 055 | Gary Malouf | Algorand VP of Engineering - YouTube
There is also huge development going on for relay nodes features
For me this is super bullish, so i would not recommend investors to get rid of algorand right now
I understand that you are a fan as I am optimistic, but in one day we lost about 10% and it shows no signs of stopping.
I am also a CEO, a smaller company but with the same responsibilities.
A CEO doesn’t make such a statement, especially if he is in the market. A declaration of this type can affect the price of the asset …
Agreed… Insteed of fighting SEC with these statements, i think it would be much better if Algorand would create white paper under MiCA regulation and show the US that it is not security but the utility token.
MiCA regulation is really not that big deal… but they must create the whitepaper… there is even the template for it in the attachments of MiCA https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:52020PC0593&from=EN
1 Algo = 0.14733 USD,
a record all time low price.
Without any effective measure (like burning 2 billion Algo) it will sink further…
But who cares? It is a medium for ASA (and NFT) only.
First if all, I think AF should not be concerned about the price. But I think they should decrease amounts they sell when price goes down. Just wasting Algos. When price is somewhere above 0.5$/ALGO they can return to normal schedule and sell a bit more. This saves AF treasury and eases sell pressure at the same time. So win-win.
What comes to burning. I think that is just stupid thing to do. Just throwing away a lot of AF funds. Dead idea. Rather they should think, how they can maximize treasury value and use it more wisely.
For the foundation the $ value matters. So you should look that way.
For algo-holders/governors who receive gov rewards, the rewards are mainly a compensation for the inflation. Most people would continue to participate even with much lower rewards (in Algos) if no or low inflation.
Any other alternative idea that works is fine! The issue is that there is little reason for people to buy Algo given the remaining amount of Algos that is gonna come to market. There is a competition among L1s and which one is a better store of value. Which one do you pick, ETH that is deflationary (you can debate the details) with a 20+x larger community or Algo with its crazy inflation rate? Most people don’t care/understand that Algo is pretty much superior in every technical aspect to ETH even if/when ETH completes all scheduled plans.
The argument that it is fine and in the long-term in the next few years it will change is a risky one. Today’s conditions and opportunities may not exist a few years later. The Algorand community is not growing as fast as it should be (if not shrinking) and other L1s will catch up in tech. Today is the time to make critical decisions and act.
If you listen to CNBC and hear CEO’s from Wall Street, they all say the same thing - we are not focused on share price, we are building, etc. She has to say this. I wouldn’t focus on that.
@awesomecrypto when I was involved in distribution or structured selling, we committed to best practice to minimize market impact, and that was always communicated. I haven’t been involved in that for a year or more, but maybe Staci just meant the same thing.
Thanks @Massimo . Although the title is a quote from Staci it is really about the Algo position among coins, in particular L1s and having a strategy to address that ASAP.
Is Staci a member here? Does she read these posts?