Have you heard of Ampleforth?
It’s an innovative cryptocurrency with an interesting solution to a potential problem found in other cryptocurrencies. More importantly, it’s price has increased about 500% in 2020.
The price increase combined with the solution to a problem has led many experts to speculate that Ampleforth might, in fact, be the next Bitcoin.
This article will cover everything you need to know about Ampleforth. In addition to that, we will offer our own prediction about the future of Ampleforth.
What is Ampleforth?
In simple terms, Ampleforth is a DeFi token cryptocurrency on the Ethereum blockchain that has an elastic supply. That means the amount of Ampleforth on the market will vary depending on the price of Ampleforth.
That’s right, the amount of Ampleforth in your wallet will adjust depending on the price of Ampleforth. That process is called rebasing – we will explain the exact mechanics of rebasing in the next section.
It’s an interesting concept for cryptocurrency. In fact, no other cryptocurrency, or financial instrument for that matter, has this property about it.
This feature is what has made many people very interested in Ampleforth.
How does rebasing work in Ampleforth?
The core feature of Ampleforth is rebasing. Basically, this is when the smart contract fulfills and adjusts the total supply of Ampleforth.
And yes, rebasing will impact the amount of Ampleforth in your wallet. This is what makes Ampleforth different from gold, Bitcoin, or any other assets.
For comparison, your gold doesn’t shrink when a gold miner discovers a new supply of gold or the price of gold changes. In the case of Ampleforth, your supply of the tokens will change.
Anyway, Ampleforth tests for a rebase everyday at 7PM Pacific time. However, the total supply of Ampleforth only changes if the price is outside a 5% price band. The target price is 1 AMPL to 1 USD.
The rebase is limited to a 10% decrease, but the increase is uncapped.
Does rebasing decrease the value of my Ampleforth?
Not really. This is because all users are impacted equally by the rebasing. The value of your Ampleforth does decrease temporarily. However, it will go back up in the event that the price of Ampleforth rises.
Again, it’s completely different than any other financial instrument. There isn’t anything out there that resembles Ampleforth.
Stock splitting is similar to rebasing, but is still different because it is based on the performance of the stock rather than the value of a currency. Rebasing is based entirely on the value of the currency in comparison to the United States Dollar.
Does Ampleforth have any real world uses?
Ampleforth does not currently have any real world uses. The development team fully admits this as well.
At the moment, Ampleforth is in the market test phase. It still has made plenty of money for the founders and early investors, though.
Don’t let the early phase of Ampleforth scare you. It does have some potential uses listed below.
First of all, Ampleforth has a low correlation. This means that the price of Ampleforth is independent of other cryptocurrencies.
As you might have guessed, this makes Ampleforth a very interesting cryptocurrency.
It serves as a great investment for anyone that wants to hedge their Bitcoin investment.
Could Ampleforth become legal tender?
It seems unlikely at the moment. However, it also seemed unlikely that Bitcoin would eventually $20,000 USD/1BTC when it was founded.
Ampleforth certainly has a better chance of becoming legal tender than other cryptocurrencies because it is much more stable.
Is Ampleforth a stablecoin?
No, Ampleforth is not a stablecoin. The price isn’t pegged to a fiat currency in a 1:1 manner. Instead, the price is pegged by adjusting the supply of Ampleforth.
We view that as a better alternative to a stablecoin. However, time will tell if this innovative strategy works or not.
Is Ampleforth the next Bitcoin?
Ampleforth has grown a lot in 2019 and 2020. Growth certainly helps with the price, but the major test of Ampleforth will be if people use it for transactions rather than as a speculative investment.
Also, Ampleforth is a DeFi token, which is huge. In our opinion, DeFi is the next big thing in cryptocurrency and has the potential to shakeup cryptocurrency.
Ampleforth has a good chance of becoming the Bitcoin of DeFi. It’s definitely a cryptocurrency that you want to keep your eyes on because the future of Ampleforth looks great if it can gain enough traction.
Is Ampleforth a good investment?
We view it as a good speculative investment. This means that it’s a low priced coin that has the potential to take off.
The odds of that are better than other alt-coins, but it’s still an alt-coin and has a lot of risk. The upside is huge, so it’s worthwhile to invest a small percentage of your cryptocurrency into Ampleforth.
How to purchase Ampleforth?
Ampleforth is not a difficult cryptocurrency to purchase – it’s available on most altcoin exchanges.
We recommend using Bitfinex or Binance as those are both trustworthy altcoin exchanges. All you have to do is deposit Bitcoin, or any other accepted cryptocurrency such as Ethereum or Litecoin, onto the exchange and you can then purchase Ampleforth.
Also, we recommend storing Ampleforth on a hardware wallet if you plan on holding it for a long period of time rather than trading it. The Ledger Nano S or Trezor One White both allow you to hold Ampleforth in a secure manner.
All in all, Ampleforth is an innovative cryptocurrency that solves a major problem that faces cryptocurrency – price stability.
The biggest hurdle Ampleforth will have to overcome is people understanding how rebasing works. It’s not a scam or even dangerous.
And in our opinion, it helps mitigate many of the problems found in other cryptocurrencies.
Our final verdict on Ampleforth is to keep your eyes on it. It’s still early, so a lot can change. But at the moment it does look promising for the eventual cryptocurrency bull run.