The views expressed in this article are mine and it attempts to help the individual in determining the price that one would be willing to pay to buy/mine TAP tokens.
The value of the TAP token is based on, largely the dividends the ICONbet platform generates, the ongoing mining rate, the treasury amount although insignificant now but it still contributes certain value. And all these factors are interconnected.
As the TAP token available for mining is getting reduced by the day, the mining difficulty is expected to increase, if it increases to what extent it will increase depends on the on-going trading value of TAP token. If the trading value of TAP is high, more people will try to mine and the mining rate will increase, if the trading value of TAP is less, less people will try to mine and the mining rate would get adjusted accordingly.
Trading value of TAP depends on the amount of dividends that is getting generated by the platform and what it means in terms of annual ROI. Based on the one’s expected ROI, the value one would like to pay varies, If one is expecting a high ROI, then they would prefer to pay less, if one is expecting a moderate ROI, then they would prefer to pay a bit more. The value also depends on the expected increase/decrease of future dividends, if the expectation is that the dividends would increase in future, then one would pay a bit more now and vice versa.
To summarise, As the dividends increases so does the trading value of TAP, which in turn increases the mining rate which in turn increases the dividends and vice versa. This is the TAPonomics cycle. Any change in Dividends or Trading Value or Mining Rate will effect the cycle.
So before you start TAPing(Mining/Buying) ask yourself the below questions.
What is your expected return on investment(ROI)?
What would the ROI be based on current dividends ?
What is the potential growth of the platform i.e what are the factors that could contribute to grow the excess ?
What is the effect of decreasing number of TAP available for mining ?
What is the effect of increasing TAP circulation ?
What effect the ICX price increase/decrease would have on the dividends or on your holdings ?
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ICX Address: hx1dcbf74146f0d27a17b02d1d13421dd4d839847c