TOKEN REDENOMINATION/CRYPTOACADEMY/S4W3/HOMEWORK POST FOR @wahyunahrul

Hello Everyone!
Its another opportunity to be here again and to be a part of week 3 of the cryptoacademy course. After going through the lecture given by @wahyunahrul on Token redenomination and carrying out my research am here to do the homework given afterwards.

---

source

QUESTION 1: EXPLAIN WHAT IS TOKEN REDENOMINATION IN YOUR PERSONAL OPINION? WHAT DISTINGUISHES IT FROM CURRENCY OR OTHER ASSETS REDENOMINATION?

(A) Before i consider what Token redenomination means from my opinion, i want to closely explain what the word means.
The word "Redenomination" begins with a prefix which is "Re" so firstly what is denomination?. Redenomination means to classify a something into a certain group. While "Re" means to "do again".
From the above explanation, therefore, Token redenomination means to do again the classification of token done before. Token Redenomination can be said to be the process of token going through some changes to produce a new token.

Token Redenomination can only be done or proposed by authorities responsible for the token. For example in our traditional banking system, currency redenomination is carried out by an authority called the central bank of that country.

Among the many reasons why token redenomination is done, token redenomination is usually done to enable investors who do not have enough purchasing power to be able to buy that token or invest in the token. Token redenomination handles the problem of having just one classification of people or a set of people having the token, therefore paving way for mixed investors( small and large investors)

---

(B) What distinguishes it from currency and other assets redenomination?

Token denomination is distinguished from others with my following reasons

• Token redenomination is proposed by those who developed the token and the investors decides whither or not to go with it while for currency Redenomination, the government of the country(central bank) controls the redenomination, which is done by reducing the number of zero's in the currency for example Afghanistan in the year 2002, month of October, brought out a new currency which was called Afghani. 3 zeros was removed the new currency.

• Token redenomination is done basically for reasons which includes, allowing small investors to come in, token liquidity and so on while for currency or asset redenomination is done either because of inflation or deflation of the currency.

• Token redenomination is also distinguished from currency redenomination because token redenomination happens digitally because the token can not be seen while currency redenomination is done physically just like in the case i mentioned about the country Afghanistan.

QUESTION 2: MENTION THE ADVANTAGES AND DISADVANTAGES OF TOKEN REDENOMINATION

ADVANTAGES

• It allows investors who have small amounts to invest in the token.
• Token redenomimation allows token to be sold easily in the market.
• It leads to the increase of market cap of the token( more people getting interested in the token)
• The value of token increases.
• It leads to growth of the project which inturn affects the crypto space positively.

---

DISADVANTAGES

• Some investors who do not agree with the token redenomination may decide to leave the project.

• Sometimes, some investors may think it is another form of scam therefore may not be interested.

• Converting/swapping old token to new may require some form of fee.

• Scammers may decide to take advantage of this process.

QUESTION 3: DO ALL CRYPTOCURRENCY PROJECT NEED TO DO TOKEN REDENOMINATION? EXPLAN IN YOUR PERSONAL OPINION

All cryptocurrency project need not to do token redenomination.

To explain my reason i have this to say;
The purpose of token redenomination is to increase the value of the token, support small investors to invest in token, increase liquidity of the token. Therefore if a cryptocurrency project has all this already happening to its token there is no need doing token redenomination. Token redenomination only applies for project without the above qualities for its token.

An example of token that does not need token redenomination is the Ethereum token called ether. Ether has value, is greatly sort by investors and is the second largest digital currency. It was launched in the year 2015.

QUESTION 4: CHOOSE A PROJECT THAT HAS OR IS CURRENTLY DOING TOKEN REDENOMINATION. AND SHOW HOW TO CONVERT OLD TOKENS INTO NEW TOKENS(screenshot required)

Source

The project i choose is the PUNDIX project.
PundiX was formally NPXS but it went through token tedenomination and became PUNDIX.
The redenomination took place march 30,2021.
PUNDIX is found on the ethereum blockchain, the token is popular and can be found on exchanges like Binance,Huobi, Bithumb.

1,000NPXS is converted to 1 PUNDIX token.
There are 3 ways the old token NPXS is converted or swapped to the new token PUNDIX.

• By the use of Xwallet method: This method happens automatically, and it is done by the system. No charges attached.
• By the use of Exchanges : This process also happens automatically.
• Manually by the use of onchain swap on the official site of PUNDIX. A fee is attached.

I will be using the third method which is done manually.

Step 1: dowload a wallet. For me i downloaded metamask wallet by going to google play.

Step 2: After i have downloaded my wallet i went to the official website for PUNDIX website

Step 3: When it opened i clicked on swap now as in on the screenshot.

Step 4: when it opens up, since i have a wallet already, i need to connect it to my wallet by clicking on wallet connect as shown on the screenshot.

The next step is Step 6:Which takes me back to my wallet as seen on the screenshot above. An instruction pops uo for me to click on connect and i did.

Step 8: It brings me to a point where i need to select the token to be swapped as seen on my screenshot.

Step 9: After i have selected the old token NPXS to be swapped to PUNDIX. At this point am required to pay a fee for this process to be successful.

I Stopped at step 9 since i dont have the fee to pay

The above is a process of how to convert old token NPXS to new token PUNDIX manually from PUNDIX official website.

QUESTION 5: ANALIZE WHETHER THE TOKEN FROM THE PROJECT YOUR CHOOSE IN QUESTION 5 IS WORTH INVESTING( screenshot required)

The project PUNDIX from my perspective is worth investing. But we all know that the crptocurrency market is not stable meaning it is subject to high volatility and uncertainty.

First lets take a look at the make of its ecosystem. The PUNDIX ecosystem is very rich, what i mean by this is that it is made up of 4 unique components which makes it very outstanding. These components are;

• The blockchain powered POS device (XPOS)
• The multi- currency non-custodail wallet (Xwallet)
• XPASS card(which looks like a credit card)
• The PUNDIX Token
  These 4 components have the special functions. For example the Xwallet and the XPASS work hand in hand to make payement made on the ecosystem easy or less stressful. While the XPOS is used for scanning when payment is made, whenever scanning is done,for payment sake, the wallets automatically debits the cryptocurrency used and converts it to PUNDIX token and the trader gets his payment immediately.
  reference

So you see that from the above it is fast and unique therefore it is worth investing in.

Secondly lets look at the growth in terms of price forcast

Source

From the screenshot above, as at the time this work was done, PUNDIX ranks 184 on coingecko and is been sold for $1.38 which is good growth. Having a martketcap of $354,276,113 and a total supply of 258,484,530.

The above two screenshots are price chart of PUNDIX token, you will see that its not doing badly at all. The bearish takes the order of the day. So from this analisis i believe PUNDIX token has a future.

Thirdly lets look at some price prediction made from some bodies like source.
They predicted price of PUNDIX token from 2020 -2025
The year pundi x got into the market was march in 2018 and that the price was $0.001USD and it recorded an in increase in the month of may with $0.012USD with its market capitalization of $360 at that time. Although the growth rate from that time began to fluctuate like pendulum just like every other coin. Below is a screenshot of PUNDIX token given.

Source

I draw to conclusion that PUNDIX token is worth investing from the various points i have made above.

CONCLUSION

I draw to conclusion that token redenomination is a very good way to regulate the cryptospace. It has so much advantages not withstanding, there could be one or two disadvantages of token redenomination but that does not cancel the fact that it is needed in the world of crypto. Even though not all token needs to go through token redenomination.

I learnt so much from the lectures and from my research so i thank the able prof in person of @wahyunahrul.

Thank you for reading