Hi. I’m struggling to understand the relationship between the balance of DIGG on my wallet and the marketcap of DIGG. The way I understood it was that since DIGG is a rebasing token, that the balance of DIGG on every address will shift up or down with every rebase. The rebasing is applied the same to every wallet, so in effect unless you send or receive DIGG your wallet should always have the same percentage of the marketcap of DIGG. I just did the math on my starting balance of DIGG vs my current balance of DIGG and it seems I’ve lost 75% of my worth in terms of BTC and 62% in terms of USD, while in the same period the marketcap of DIGG has returned to what it was when I purchased my DIGG.
So obviously my assumption of keeping the same percentage of the marketcap is wrong. I would appreciate some help in understanding why this is not the case. Thanks!
Hey bud, I’ll try to give you a scenario that might help you understand:
You first purchase DIGG at the following parameters: MC= 70mm, Price= 35,000, Supply= 6000, you bought 200 DIGG, or your initial % of supply= 3%, therefore your money invested is 7mm.
The price is below peg, therefore we have a month of negative rebases. The new parameters are: MC= 70mm, price= 45,000, Supply= 2500, but with the new parameters, supply has reduced by 58%, therefore your 200 DIGG is now 84. Your USD value is 3.7 mm, but 84/2500 (your supply divided by new, reduced supply)= 3%. While these numbers are approximate, you still own the same share of the supply, but all of the parameters have been reduced apart from market cap and your % share.
Hope this helps you understand! We are all suffering together. There will be a bottom!
There wont be the bottom till 0. Same is for Badger. This is undisputelly worst coin i have ever invested in my life.
Hi. Thanks for the reply and attempted explanation, I really appreciate it. However, I still don’t quite get what’s going on here. I thought that marketcap was supply times price? So in your example the marketcap in the scenario should have at first been 210mm rather than 70 (6000*35000 = 210 000 000), and should have been 112.5mm after the rebases. This would be a 46% decrease in marketcap, which corresponds exactly to the decrease in worth of the DIGG in the example (7mm to 3.7mm). So this all makes sense with my initial understanding that your DIGG always are the same percentage of the marketcap. So I guess my question is where you got the 70mm marketcap both before and after the rebases in the example scenario?
Thanks again for the help!
You will not get correct answers from this scammers. Unfortunately. Price shows reality of this sad coin which is already on respirstor
Yes, so the reason why the marketcap wasn’t 210 mm rather than 70 is because at first launch, the price of DIGG was significantly over peg, resulting in positive rebases. Positive rebases do not increase the marketcap, but they do increase the USD value of your holdings. For example, if you had 1 DIGG, price is 40K, MC of 70mm, and a positive rebase of100%, you would now have 2 DIGG, valued at 80K, MC still of only 70 mm, meaning DIGG is overvalued. The rational actors in the market would sell their excess DIGG, lowering the price until we reach equilibrium.
The initial supply of DIGG was 4000, we ballooned to nearly 8000, and have since been trying to return to fair value. Anyone (including me) who invested during that expansion is definitely feeling the pain because DIGG is far from its fair market value, which would be current supply x price. An easy way to tell if you are getting in at, above, or below fair market value is to multiply supply x price and see if that = current market cap. If it is <, then you’re getting in when it is undervalued. if it is >, then you are getting in at overvalued. As of this writing, supply = 2417, price is 36,800. That should be a MC of 89mm. However, current MC is 64 mm, meaning, as crazy as it sounds, we are still OVERVALUED. Need more negative rebases before this baby can return to peg at fair market value.
It sure is painful, not only the amount of DIGG decreasing, the value of DIGG is also going down. I am down to a quarter of what i had to begin with. There seems to be no end in sight and i am wondering why in a bull market like this DIGG value remains stuck. Hopefully things turn around soon.
hey with patience, things should bounce back to normal. Sometimes markets just take some time to properly react or understand what is happening.
I’m sorry to be a pain, but I still don’t get it. How are you calculating the marketcap? I thought that marketcap is simply supply times price, but here you are saying to compare the supply times price with the marketcap, which should always be the same since the marketcap is calculated by taking the supply times the price? If this is not the case, how is the marketcap calcualted?
You’re not being a pain, understanding rebasing tokens is difficult. Market cap is supply times price with normal tokens. However, when the supply increases in a rebasing token, that excess supply is valued at the same rate as already existing tokens, but does not mean that more buyers have come in to raise price and marketcap. I’m calculating real marketcap (based on coingecko) vs marketcap at equillibrium (supply * price) and making a decision if DIGG is over or undervalued.