Sorry I'm new, What do you mean lower turnover? Like asking people nicely not to sell their monero?
How to lower turnover and increase stability of Monero?
infinum posted this 6 years ago
Hello,
I asked on Reddit how to lower turnover and increase stability of Monero? and this sort of ties up with another Reddit thread: what is Monero's end game?
I personally would like to see Monero as some kind of reserves that are used for private transfers. Right now the protocol provides the privacy bit but there is nothing that creates any kind of reserves requirement to hold XMR.
I doubt companies or states will put Monero as their reserves any time soon, if ever. To me there is a lack of long term incentive to holding the coin, absent expectation of constant value increase.
I am curious of your thoughts.
Turnover i.e velocity is basically: annual volume / average annual market cap.
If it is high, that means people do not want to hold the asset for very long - they acquire it and get rid off as soon as possible. An example of high turnover currency would be one, that is hyperinflating or is shady and unbacked like Tether.
A low turnover is the opposite - the asset circulates but only a small fraction of its market cap is exchanged at any given time. When a currency has low turnover and high volume that indicates that it should be rather stable in value.
Within top 20 currencies by volume the stable i.e. low turnover (<=25)/high volume coins are: XRP, BCH, XLM, NEO, ADA, IOTA, DASH - unfortunately Monero has too low volume to be included.
Fun fact: At the moment BTC and ETH have huge volume, but their turnover hangs around 25-32, so it is too high to include them within the stable-currency club.
It would be great if Monero protocol encouraged low turnover, since the volume can only be increased organically.
