As a potential investor, I have followed the Splinterlands ecosystem for over a year. I wanted to write an article about Splinterlands as the end of SPS airdrop is one month away.
As we all know, the price in the free market is formed at the point where supply and demand are balanced — assets with limited supply and high demand increase in value. Cryptocurrencies have high inflation in their early stages because high inflation helps to penetrate the market. After that, token inflation gradually decreases.
Splintershards(SPS), the governance token of the Splinterlands ecosystem, was launched in July last year. It is planned to be distributed through a 1-year airdrop to investors who own Splinterlands ecosystem coins and NFTs. As of today, there is one month left for the SPS airdrop to end.
SPS token distribution takes place according to the table below.
The table shows that it is planned to release 3 billion SPS in 5.5 years. Token inflation for the first year is relatively high due to airdrop and private sale tokens being released in the first ten months.
Private sale coin emission has ended, and the airdrop will end next month. Thus, the monthly average coin emission will be reduced to 42% of the first year's emission. Source
Other things remaining the same, it is not difficult to predict that this will put upward pressure on the SPS price.
This particular case of the SPS token economy is known to many Splinterlands investors. When will the price change? Is this still within current prices? When we examine the last three-month course of the SPS price, we see that SPS has gained value on the basis of Bitcoin. (The yellow line on the chart shows the BTC-based price.)
The fact that SPS gained value against BTC during one of the most significant turmoils in the history of the crypto market is an essential indicator of investors' trust in SPS. It is not possible to know for sure whether the end of the airdrop is priced or not.
It would not be correct to evaluate the performance of SPS only on price. The chart created by @dalz shows us that reaction buys come when the total market cap of SPS drops below $60 million. Even in these difficult times, SPS has maintained its total market value.
When we examine the price chart, we see that SPS has been in the price consolidation phase since June 14, in line with the crypto market.
SPS roadmap shows significant developments in the @splinterlands ecosystem by the second quarter of 2023.
- Design and sale of Riftwatchers cards,
- Implementation of SPS governance infrastructure
- Land NFTs can be bought, sold, and they will be included in in-game mechanics
I guess that these improvements will have a positive impact on SPS prices.
SPS Investment Alternatives
We can invest in SPS tokens in several ways. The most obvious of these is to stake SPS on the Splinterlands website. We can achieve an annual return of 37% with this method over SPS.
By combining SPS with an equal monetary amount of Hive on Beeswap, we can achieve an annual return of 15% on our investment.
Another alternative is to invest in the BNB-SPS liquidity pool on Pancakeswap. The liquidity pool still provides a 30% return. This investment alternative is more attractive to me than the others, as the inflation rate of BNB is zero.
Conclusion
Splinterlands is a pioneer with its innovative approaches to blockchain-based games. On the other hand, its market cap lags far behind Ethereum-based games like Axie Infinity, Decentraland, and even Illuvium.
I am bullish on Splinterlands as I trust the leadership of Aggroed and Yabapmatt, the founders of Splinterlands, besides the abovementioned factors.
I may be biased on Splinterlands as I am still invested in SPS. Please do your own research on Splinterlands and SPS. This review published last month on the Coin Bureau website may be a good start for your research.
Thank you for reading.
Posted Using LeoFinance Beta
