Dash is the fourteenth cryptocurrency by market capitalization, with a total value of USD 1.33 billion. The maximum supply of Dash tokens, by design, is of 18,9 million. Of those, 8.822 million are currently circulating. So there’s not a very high number of coins going around, which means that inflationary pressures on Dash shouldn’t be too intense. And now, the Dash Core foundation wants to create additional deflationary pressure (increasing the price by lowering the offer) by creating the Dash Investment Foundation. Here are the details.
The project was proposed by Ryan Taylor, who serves as CEO for the Dash Core Group. Once the ball started to roll, the group’s legal and financial team started to do the work, and they chose the Cayman Islands as the place to go. The reason behind this decision has to do with the broad selection of legal options that the Caribbean island offers to foreign investors. More concretely, there a legal category called “foundation company limited by guarantee,” which fits Dash’s wishes perfectly.
The new investment fund will be the first investment fund in history that will have no members and no owners at all. Instead, it will be administered by four supervisors elected democratically by the network’s masternodes. And the partners will be all Dash users though indirectly. The objective is to use the foundation’s investments to increase the value of owning the Dash cryptocurrency for every holder in the world.
How can that work? The new investment fund will use its money to create profits, as any fund does (or intends). Then, those profits will be used to develop deflationary pressure on Dash in two different ways:
- The fund will use the profits to buy Dash tokens in the open market, thus increasing demand and trading volume. Both things tend to push an asset’s price up.
- The tokens acquired with the profits will be burned so that they will stay out of circulation permanently. This also pushes the price up because it creates scarcity in the market.
So, the investment fund is ownerless and memberless because it will positively affect every user who owns Dash in any quantity. In a very indirect sense, every Dash holder is a partner in the new organization.
When will the fund start doing business? Two things are still missing. First, the fund’s supervisors must be elected. Then, the fund’s constitution must be finished. Once both issues are solved, it’s all good to go.
Dash’s idea is indeed quite exciting. It’s going to use a cryptocurrency in the fiat markets to create profits that it can later use to support its own cryptocurrency’s value. This idea needs depth of vision and a very subtle mind that knows the economics behind monetary policy and market dynamics very well.
The fundamentals of the Dash project are substantial. So it’s always been a mere matter of time for the coin to pick up in terms of market performance. But now Dash Core will attack the problem of the Dash price from two fronts at the same time. At the fundamental level by keeping up the project’s development and at the technical market front as well by pushing for deflation.
If the new investment fund works out, we could see a stream of crypto-based investment funds.
Disclaimer: The presented information is subjected to market condition and may include the very own opinion of the author. Please do your ‘very own’ market research before making any investment in cryptocurrencies. Neither the writer nor the publication (TronWeekly.com) holds any responsibility for your financial loss.