99% of Token Price Is Pure Speculation Says VeChain Founder
VeChain founder Sunny Lu stated that speculation is the main determiner of token prices in the blockchain industry.
Speaking at a panel today at BlockShow Asia 2019, VeChain founder Sunny Lu suggested that token value is mostly arbitrary.
The panel was titled "Creating Token Value — Are Monetary Gains Hindering Blockchain Innovation?" and it also included Eddy Travia, co-founder and CEO of Coinsilium; Matthew Roszak, chairman & co-founder at Bloq; Greg Wasserman, co-head of principal investing at Galaxy Digital; and Dr. Pavel Kravchenko, CEO & co-founder of Distributed Lab. But Lu’s commentary broke through:
“99% of a [token’s value] is linked to speculation, and not to the value that solution can bring to society. This causes many startups to waste a lot of time producing and 'selling' the token, failing to develop solutions for where they were initially focused.”
Lack of practices in determining the value of blockchain projects
Discussing how to determine the value of blockchain projects in this new industry, other speakers noted the difficulty of finding an accurate valuation for projects.
“There is no way forward, no good practice that you can look at and mirror,” said Roszak. “It's in the early years and everything is still very new, so it's very difficult to determine the value of blockchain-based projects. Here we are learning and developing in a totally disruptive market, and I believe we will continue to develop this market.”
More skeptical of the value of the token industry, Kravchenko stressed that users need to be involved in the ecosystem and create a form of “currency” that is stable enough to allow use among features mentioned in the project.
“What is a stable currency? I don't consider traditional currencies stable,” Travia countered, turning the debate over how to separate the value of the token from the value of the project itself.
Wasserman stressed that the question of the value of various projects are still very much connected to the value of that project’s token, and that this can undermine innovation in certain cases.
As Cointelegraph reported a little earlier, Elixxir President Jim Dolbear announced the launch of xx coin, a digital currency that will support decentralized messaging, payments, and dApps on the associated xx network.