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RE: How to Invest in The Great Token Revolution
I laughed so hard at the meme. Like I actually LOL'd.
I really appreciate this explanation. I'm just really starting to understand these concepts for the first time and so everyone who uses any kind of analogy on here is my immediate BFF. I do have a question for you, though -- say I do sell tokens, (shares, essentially?) of the famous painting hanging in my museum. If the price skyrockets and I never sell it, what value does that give my token holders? Or are they making money based on museum ticket sales? Sorry, that may have turned into a philosophy question somewhere along the way.
This is a great question. While it's unclear how we will value rare assets (like a one-of-a-kind painting) with tokens, ultimately the market will decide the value.
Since you like analogies, here's an analogy using the stock market. If investors buy a stock in a company, and never hear anything from the company again, they'll lose faith in the company, everyone will sell, and the value of the stock -- and thus the company -- will go down.
It's likely the same thing will happen with tokens: if someone buys a token backed by a Warhol painting, but Warhol starts to go out of style, the value will likely go down. If there's a Warhol renaissance, or MOMA puts on a huge Warhol retrospective, the value will go up.
Thus, tokens will motivate the owners of the underlying asset to always be ADDING VALUE, just as the stock market motivates corporate managers to constantly ADD VALUE with their companies. Hope that helps!