The number of HEC tokens is decreasing every single day!
I guess this sounds like a dream to most crypto protocols, but HectorFinance has actually managed to make its protocol deflationary. Of course, there is no guarantee that it will remain deflationary forever as it is strongly depending on people minting the stablecoin TOR and then the funds used to mint TOR is used to buy HEC tokens and then burn them. So, as long as there is a steady flow of people minting the TOR token, there will be a bigger amount of HEC tokens burned daily then the number of tokens handed out to stakers on the platform. And to be honest, that is a great thing for the HEC tokenholders.
- You can learn more about what it means to be deflationary in the following article.
At most, there were more than 3,500,000 HEC tokens in circulation, but in less than 45 days, this number has been lowered and currently, there are less than 3,000,000 tokens in circulation. How has this happened? Through burning more tokens than the number of tokens issued to stakers.
As people started to notice this, it has also greatly affected the price of the HEC token, taking it from $12 to a top of $26.5 earlier today. It has dropped a bit in value since then and the current price of a HEC token is $22. No matter what, this is a perfect example of the positive effect it can have on a real value token with a real use case as the supply is lowered, making it more scarce, which again influences the price in a positive way.
Are you a HEC holder? Do you have faith in Hector Finance?
Some people have said that HectorFinance unfortunately suffered together with all the other rebase tokens, and that has caused the giant price dump. I guess that is mostly true, and if it hadn't been for the other tokens falling (TIME, OHM, KLIMA), then HEC would have done better. But, due to the trend, people sold in fear and this caused HEC to fall. But, as the market is realising that HEC actually has great value, people are starting to buy again.
I am curious to see where this will take us in the end.