It seems inevitable, a coin pumps and people come to this sub to find out why, and for those that buy they have to hope it doesn't retrace. This post aims to give you the down low on Moons before that pump when people inevitably flock to the sub and ask "why are Moons pumping?". (I started writing this post when Moons were $.15 but am in the middle of a move so didn't finish it until today.)
I'll do my best to offer an unbiased take that covers both the good and the bad of Moons.
What are Moons?
If you aren't brand new to Crypto you've probably already heard about Moons to some extent. Moons are a governance token for r/cryptocurrency launched by Reddit, before they later sunset their involvement, burned their Moons, and renounced the contract. Hard locking supply and making Moons deflationary through the buy and burn engagement processes created through community governance. For more information on Moons check out the wiki (which may or may not be up to date: https://www.reddit.com/r/CryptoCurrency/wiki/moons//_wiki/)
Breaking it Down:
The Good:
Perhaps a few of the most positive aspects of Moons are:
· Brand Awareness
· Low Marketcap (lots of potential upside)
· Deflationary through multiple buy and burn mechanisms
· Being a Governance Token for one of the single larges point of entries for new/upcoming CryptoCurrency enthusiasts.
The Bad:
· Top Heavy Holders
· Amateur Reddit Whales
· We don’t pay entities for listings/marketings
Both Good and Bad:
· Community Lead
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The Good
* Brand Awareness and a top-notch ticker:
Although Moons aren’t known by those outside the world of CryptoCurrency they’re pretty well known by CryptoCurrency enthusiasts, and every time a new entity buys and burns Moons another entity and their community becomes aware of the usecases and utility of Moons.
Also let’s get something straight the ticker ‘Moon’ is top notch.
* Low Marketcap and the potential upside:
In the world of CryptoCurrency the current marketcap of a project can help third parties decide if a project has potential upside or not. The marketcap of Moons Is astronomically small compared to most projects 18.4 Million, or in other words 184 BTC.
That isn’t to say a low marketcap guarantees upside but find another low marketcap crypto that is as well known and has as big of a community as Moons. You cant!
* The Deflationary Mechanisms of Moons
Let’s talk about Moons Circulating Supply! When Reddit was part of the project a decreasing amount of Moons were minted every month to be distributed. After Reddit sunset their involvement and burned the contract. Moon supply became capped and any burns decrease the circulating supply.
rCryptoCurrency offers various engagement options where approved entities can burn Moons for various forms of utility on the sub – such as hosting giveaways / running AMAs / customizing the banner. In fact 1% of Moons have been burned through this mechanism YTD. Moons burned through this process are often purchased off of the open market.
Additionally a portion of the funds used to purchase .moon domains from Unstoppable Domain (currently paused) will be directed to Moon burns.
* rCryptoCurrency and the greater role in the CryptoCurrency ecosystem.
Moons started as a governance token for r/CryptoCurrency, where holders of the token can vote on governance for the subreddit and earn Moons through participation on the sub. These mechanisms by themselves bake the awareness of Moons into all users who participate on the sub.
Combined with the fact that r/CryptoCurrency is the single largest CryptoCurrency community on the internet this adds a whole new level of depth to the long-term value of Moons. Although many of these users may be off and on-again retail, some of these users will go on and embed themselves as builders in the CryptoCurrency industry, and empower the next generation of CryptoCurrency builders with the knowledge and awareness of Moons if nothing else it creates an abstract value proposition for the future.
The Bad:
* Top Heavy Holders:
With Moon Circulating Supply being ~79M total Moons, one only need 790K moons to hold 1% of Moons supply and with Moons being deflationary that number will decrease as time goes on. Although no one but a handful of Mods were able to earn 1% of the supply through the previous Reddit distribution model, many users such as myself were able to earn close to . 2% of the current supply through long term participation on the sub "Moon Farming" .
Given the fact that Moons are incredibly cheap and at one point dropped to around a 2.5M marketcap when Reddit sunset their involvement. There is a rightful concern to how many Moons were either earned or bought up by whales for cheap and their ability to sell and suppress price movement.
* Amateur Whales:
Moon volume has never been completely consistent although we are now at the point of basically having ~$100k a day volume – total volume fluctuates and the ability to buy/sell without creating huge price movement can fluctuate. This wouldn’t be particularly concerning if it wasn’t for Amateur Retail Reddit whales loving to market sell an entire position causing huge price fluctuations and potentially suppressing price discovery.
If you’ve been around Moons for awhile you’ll know of “Moon Farmers” who would market sell 120K+ Moons positions dropping the price $.07+ during price discovery.
* We don't pay for Marketing / Listings:
Did you know lots of companies like Binance, Kucoin, etc... will allow companies to pay for listings, and Crypto news companies will write sponsored content about projects in exchange for payment? This isn't something that Moons has or does. Although mods control a multi sig wallet that covers distributions we don't pay for any formal marketing or listings.
Both Good and Bad
* Community Lead:
Moons are Community Lead by volunteer moderators and members of the community and that might be Good or Bad depending on how you look at it.
Users and Mods are incentivized to make Moons better and to help grow the community as to expand value propositions for outsiders and to increase the value of the tokens that they hold.
In this way Moons are like the early community of Doge. We love our community and we volunteer our time to try and help build and grow our community. Being community lead we don’t have financial backers or VC firms to help our growth. It’s all up to us.
Note on circulating supply:
Although it is true that Moons are deflationary with the circulating supply having dropped over 1% so far in 2024 that doesn’t mean Moons will increase in value. A decrease in supply means price would increase if demand stays constant or goes up. Of course there is no guarantee Moon demand will increase or stay constant. Moons often go through wild swings of demand which creates price volatility and demand can fluctuate wildly.
Disclaimer: in December 2023 when Moons were ~$.13 and still recovering from the sunset drama I recognized Moons as being undervalued for the reasons stated above and converted my entire crypto portfolio to Moons. I will look to convert some of those Moons back into BTC in the future.
TLDR: Moons imo have insane value prop but there is rightful concern about top heavy holders and Retail whales.
Final note: Despite being long this is a very surface level approach to the value prop of Moons, there is a lot more to know for those wanting to find out about the project.