The velocity of adoption will always outpace development, and so it’s important to account for both current realities as well as future demand when building a product. In spite of AMP’s recent surge, I’m still bearish on the coin because I see very few people actually using it. And if there are few people using it today, how much more likely is it that there will be even less tomorrow? This makes me question its viability as a currency.
I am also not convinced that this coin may be superior to Bitcoin for use as currency because it cannot be seen as being able to compete with other currencies without significant work. For example, if one were to pay a mortgage or utility bill, a business transaction (ie buying coffee), or even donate money, bitcoins are available and can accomplish these tasks in a matter of minutes. As such, all of the reasons why I was bullish on Bitcoin back in 2011 don’t apply to AMP because it takes nearly 24 hours for all the coins to be distributed before they can be used, which means it has much less value relative to demand.
Why did AMP price surge?
AMP’s price surge is probably a result of a move from the top-left to the bottom-right. I think this is due to lack of trust in cryptocurrencies, which has been reflected in the last two weeks by liquidation across many altcoins; this likely caused a few traders to get into AMP thinking it was undervalued (like many FUD articles). This pump happened very abruptly and it appears that volume went from 50k USD at one point to over 1.5M USD per day over the course of 24 hours.
In the past week @amptoken had a daily trading volume of around £4 million, today it has shot up (17.5X) to over £70 million ($85 million) in the last 24H. #amptoken $amp @FlexaHQ
— Web3Project.X (@web3project_x) June 30, 2022
The pump coincided with the largest market cap on record at ~10M USD. The next day, however, the price dropped ~20%, and volume returned to normal. Keep in mind that this happened over the course of about two weeks. Clearly, this resulted from significant panic selling across many altcoins as well as many investors moving into BTC.
AMP price prediction
This price surge has led me to revise my price prediction for AMP. I’ve lowered my target to 6 USD per coin, which is still a 50% premium over the current price. This is because I think there will be a correction of 50% or more in the next few weeks, and I believe that all coins are likely to correct by at least 15% based on all the action over the last few weeks. While AMP has surged, I believe that it’s become too speculative, and I will wait until the price stabilizes to buy.
AMPs are still not traded on many exchanges, so there is very limited liquidity. In addition, the distribution of coins among the many nodes will continue to be an issue until it reaches critical mass and these issues can be addressed. These problems will likely create a significant premium in value for AMPs relative to BTC (and other cryptocurrencies), which is needed to make adoption viable. However, while this situation is poor and can continue indefinitely, these issues are less likely to persist in the long-term than short-term because of AMP’s increasing use as a means of payment .
When Will AmpCoin Reach its Lowest Price?
It is hard to say when exactly the price of AMP will hit a low relative to the last few weeks. However, I expect it will likely be in the range of 3-5 USD based on all of the factors involved. It’s also important to keep in mind that even if AMP hits a low, there is no guarantee that it will stay at that price: there’s nothing forcing a trader to buy at lower prices. I expect this situation will persist in perpetuity until most exchanges are added and liquidity becomes more stable; at which time, I would expect this currency to become more viable as an alternative currency.
