An important message for those of you trading the CommunityNodeToken on the Tron DEX's.
You may remember the CommunityNodeToken (TRUC), which we gave away by the thousands when newcomers joined our telegram channel.
We've always been up front about the value of the CommunityNode Tokens - they have no value. Until recently, that is. A few weeks ago we started to apply our share of the Super Representative allowance to the value of the TRUC token.
There are some things to be aware of when trading the TRUC tokens over the short and long term.
The SR Candidate earns a small allowance while waiting to become elected as a block producing Super Representative. Our TRUC token represents the allowance our SR Candidate has saved.
The price of our TRUC token should grow in value to reflect the growth in our total assets. We will limit volatility in price, but exactly how quickly we will allow it to grow and based upon what formula, is still to be determined.
As the CEO of CommunityNodeToken, my goals are identical to what the token holders want. Neither of us wants to see the price of the TRUC token grow so fast that only one person can sell at the top. Our goals are to create price stability and build value. The strategy to accomplish this is to consistently increase the capitalization of our trading exchange.
To carry out this strategy, our first monetary policy is to sell TRUC and maintain a constant supply of 500 Million tokens on the exchange. This should provide price stability while limiting volatility.
We started the TRUC/TRX exchange, ID: 129, with 500 Million tokens and 1000 TRX, which set the initial price per token at 0.000002 TRX. Since then, an additional 11000 TRX liquidity has been added while the supply of tokens on the exchange was kept constant at 500 million, bringing the price per token up to 0.000024 TRX.
Every day new capital comes into the TRUC trading exchange when people buy our tokens and when we claim the allowance that Community Node SR Candidate receives. This new capital, if allowed to flow into the exchange unchecked, could result in unhealthy token price growth.
Basically, when someone buys TRC tokens with TRX, half of that TRX goes toward increasing the price of the token and half of that TRX goes toward freezing votes for Community Node.
Our account keeps a reserve of capital equal to that held in the exchange, which can be used to support the price of the TRUC token. In the same way as we curb the growth of the price during capital inflow, we buffer the drop in price when people divest. While it's waiting to be used, this TRX is frozen to cast votes for ourselves. Most of it has been frozen for longer than 3 days and is available for withdrawal with no waiting.
We complete our strategy by injecting capital and supply into the exchange at the same time. This dual-sided transaction is neither a buy nor a sell and does not affect the price of TRUC tokens. What it does is it "makes the pie higher." Consistently increasing the capitalization of our trading exchange will slow the rate that the price changes when people buy & sell. Until the entire 10 billion TRUC token supply is fully capitalized, every trade will unduly affect the price.
Over the long term, our monetary intervention will ease as we gradually dilute the supply of tokens on the exchange until all 10 Billion TRUC tokens are in circulation.
Although none of these measures is a bullet proof vest for preventing a sell off that affects price, we hope that together they can elevate the quality of the TRUC token and the value it holds.
CommunityNode's Solution to "Vote Buying"
For some time, the Tron Super Representatives have been concerned about the direction that voter rewards are taking the Tron project. It seems the rewards have an unwanted effect that makes the grassroots node organizations less competitive than self-elected SR's and their consortiums of wealthy voters.
We at Community Node have our own history with vote buying and are perhaps best remembered for terminating our voter rewards program just 2 days into an aggressive vote buying campaign. The problem we ran into was that the voter rewards left no income for actually running the nodes.
In a series of articles, I laid out the futility of voter rewards and questioned the desire to be a Tron Super Representative. Given the current status of voter rewards, I announced that Community Node would terminate our campaign for Super Representative until a solution that provides a competitive edge could be found.
To combat vote buying, one suggestion from the SR's has been to set a limit to how much all Super Representatives can reward voters. Another suggestion has been to completely take away the ability to reward voters. In my opinion, legislative over-engineering is not the path to a solution.
I am a fan of the SesameSeed method, issuing rewards through their SEED token. In particular, I like the part where the voters get leverage compared to what they would get if SesameSeeds were to merely reward them with TRX. This gives them a clear advantage that is easily seen by anyone counting their share of the vote.
Creating a token that carries additional value is obviously the answer to the vote buying problem. But how? The answer it seems is pretty simple.
There are two rewards that Tron pays with every block produced. We are mostly familiar with the block production reward which is 32 TRX paid to the 27 Super Representatives who take turns producing blocks every 3 seconds.
The second reward is 16 TRX per block shared by the top 127 SR Candidates based on their percentage of the overall vote. The more votes a candidate receives, the greater their share of the 16 TRX allowance.
Our TRUC / TRX exchange is capitalized with our shared 16 TRX reward that our node earns as a SR candidate. We gladly allocate 100% of this shared 16 TRX per block allowance into the exchange because it creates a clear division of income streams versus the 32 TRX in block production income.
Once we become elected to Super Representative and begin to earn 32 TRX for every block produced, that additional income will go exclusively toward operational expenses and not be used to capitalize our token. Keeping the income streams separate will insure the financial solvency of running the node while setting a voter outreach budget that reflects the income we receive from those efforts.
You could say the price of the TRUC token becomes a gauge of the number of votes that Community Node receives. TRUC token's capitalization will increase faster when we as a candidate become more popular.
We hope this new strategy will create an incentive for the Tron community to trade the TRUC token and to to vote for us for Super Representative.
The CommunityNodeToken info page:
To trade the CommunityNodeToken on Tronscan's TRXMarket, you must search for TRUC and add it to the Favorites tab.