Quote from: MyFarm on March 31, 2016, 03:44:35 AM

Quote from: SyRenity on March 31, 2016, 01:24:53 AM

I well understand how it works for Factom, ensuring they and their clients will never reach a position where the Factoid are prohibitively expensive to buy off market.

What I don't understand is how the increased adoption benefits us the coin holders, as any temporary price increase will be always balanced downwards (the more EC's used and more Factoids are burnt / purchased, the more the increased EC/Factoid exchange rate will push the price back).

I love this project and have invested a little for the LONG haul, but the fact is, Factoids are horrendously overpriced at present. How do I know this? From Brian Deery's post here: https://www.reddit.com/r/factom/comments/47nyx0/thoughts_of_the_economic_model_of_factom_and/d0gqwdz

Quote from: Brian

The Factoids also are a reward to the servers to pay for engineering time, server, and bandwidth costs. The current market price of ~1$ roughly corresponds to a steady state prediction of about 800 gigabytes/year being added to the system or about 27 TPS.

1 entry credit allows you to enter up to 1kb of data according to the store here: https://www.factom.com/entry-credits/

What that means, is that at a Factoid price of $1.00, 800 gigs a year allow for 800,000,000+ entry credits to be used. If you look at the blockchain, on 10/05/2016 they entered Project Gutenberg into the chain which consisted of over 22,000 books. Not single documents, but BOOKS. By my rough count, 22,000 books used up around 20,000 entry credits.

If I'm correct, and I believe I am, this means Factoids are pretty darn overpriced right now. Sad

At a current price of $1.70, that means we're looking at needing to use 1,360,000,000 entry credits.

I understand your concern, but i think the way you build your foundation for this conclusion is shaky - to say the least.
Could you explain how you get to the estimation of 20,000 entry credits for 22,000 books? And i assume you mean 10/05/2015, not 2016?
I don't think it's fair to say that Factoids are currently overpriced based on this one transaction into the chain.
The current price, like the price for all cryptocurrencies, is based on expectations. How else can we explain the current price of Ethers for example? Are the actual current transactions on the Ethereum blockchain supporting this price?
Also, we have no idea what the number of transactions/ amount of data will be that goes onto the blockchain once Factoids will actually be used in real life. Working for a large insurance company myself i am aware that 10,000's of gigs of contract related data are stored on servers/in the cloud for my company alone. 800 gig is nothing.
I think it's safe to say that we are all still early adopters here, investing in/hoping to make money on a new technology that has not proven itself yet. Making estimations on pricing before the technology even had a chance to prove itself, based on an analysis of 1 transaction, is a questionable approach imho. If that is your approach, then you should maybe find other, safer investment opportunities.