The difference is that BTC is a freely traded asset. Supply/demand have determined the value of Bitcoin. The CEO alone has determined the value of paycoin.
No, the CEO has determined the *initial* value of paycoin, and what he will value it via paybase. What the markets do and what people want to buy/sell/trade at is their business, and it will stabilize at some point after the initial panic sells and the dust clears.
What makes you think that XPY won't be a freely traded asset, btw?
What I mean is that the price won't be determined by supply/demand, but instead by the set value of $20/coin. Sure the price can go up to $100/coin if the free market decides, but I don't see how that can happen with a currency that has an inflation rate of 400% per year.
With bitcoin, the price may go down to $1/coin which would make many investors sad, but it wouldn't affect the intrinsic value.
Paycoin's intrinsic value is that it's stable/profitable. So when that's gone, all that's left is a bunch of halfassed features nobody really cares about.
Here's an example of what will happen:
Step 1: Investor spends $2.5m to acquire 125,000 paycoins to buy a prime node.
Step 2: After 2 years at 400% apr the investor now has 2,000,000 paycoins
Step 3: Investor thinks that turning $2.5m in to $40m is good enough. dumps $35m worth of paycoins. Scheme collapses.
The problem with this scheme is that the only real value is the promise of profit. Without the "guaranteed" price of $20/coin everything collapses.
There's a problem with your math. You cannot get a prime controller without the ability to stake 1% of all available coins. There will be no new prime controllers or changing of hands for at least the next 6 months. Depending on how many coins shake out of the POS tree, the prime controller owner is going to have to restake a good chunk of their newly minted coins in order to keep the controller. They can cash out some of the profit coins, but they can't ever call it quits. They either have to sell the controller, or let it expire and then try to cash out coins, tanking their profits with a sell wall.
125,000 is 1% of all available coins right?
And yes, you cannot spend the coins when staked, but why not after? What's preventing that investor from dumping his entire stash after 2 years? Or multiple investors dumping their stash after 6 months?
There have to be buyers for your 2 million coins in your scenario. If it's all a scam and fraud... who is going to buy them?
Exactly my question, who is going to buy these coins? (besides GAW who promised to spend $35m propping the price up at $20/coin)
One last question: If you think 400% profit per year from staking is sustainable, why not 1000%? or 10,000%?
Side note: thanks for trying to have a serious discussion. It's not often we can debate with GAW supporters without it immediately degrading to insults.