The Winter Halving is Three Months Away

On the 4th of September, the rate of production of Winter tokens will be cut in half, marking three years since the tokens were launched, and the end of the first complete cycle of the token economy.

When the tokens were launched in September 2021, Winter was produced at the slowest rate of the four tokens, and was consequently the most expensive token. With each halving, the token that’s produced at the fastest rate becomes the slowest. In the following months, that token tends to become the most expensive, as the market adjusts to the lower supply. After the Winter halving in September of this year, Winter will once again be produced at the slowest rate, and is expected to become the most expensive token once again.

Analysis of the behavior of the four prices since mining started shows that the prices have approximately moved 1% per day towards the ratio of the mining times. Initially, this ratio was 5:6:7:8, with 8 Spring tokens produced for every 5 Winter tokens, and the prices were close to this ratio. The dotted lines in the chart above show the trajectories that the prices would follow if they exactly conformed to this model.

One visible and systematic departure from this has been the tendency of the cheapest token to trade at a premium. While the three most expensive tokens have tended to follow the theoretical prices, the cheapest token’s price has tended to oscillate between the theoretical prices of the cheapest and second-cheapest token.

This is almost certainly due to the actions of traders following the rule: Trade tokens for more tokens. As traders have swapped the three most expensive tokens for the cheapest one, they’ve pushed up the price of the cheapest token, keeping it above the price that one would expect based on the mining time alone.

The cycling prices provide an opportunity for profit: A trader who started with 10,000 Winter tokens could have swapped them for a greater number of Spring tokens, and then swapped the Spring for an even greater number of Summer tokens, and so on. That trader could have more than 30,000 Winter tokens today.

If the trader wants to take a profit in USD, they could sell 20,000 tokens, and they would have 10,000 Winter tokens plus twice that value in USD. This is clearly better than just holding 10,000 Winter tokens. The “Trade tokens for more tokens” strategy outperforms the buy-and-hold strategy.

This ability to use the tokens to make a profit, and still have the same number of tokens after profit-taking, is the unique innovative feature of Seasonal Tokens. It’s a novel investment strategy for cryptocurrency trading. By never trading tokens for fewer tokens, a trader can eliminate the risk of making a trading loss measured in tokens, while continuing to profit over time.

Alternatively, the trader could keep accumulating more and more tokens over time. As the halvings go by, the tokens become produced at slower and slower rates, just like Bitcoin. This increasing scarcity can be expected to put upward pressure on the prices.

The tokens are produced quickly today, with about 10,000 tokens of each type mined every day. Ten years from now, only about 1,000 tokens of each type will be produced every day. By using the tokens to get more tokens over time, a trader can accumulate a stockpile of tokens that will take a very long time to mine in the future.

Looking back over the previous years, it’s clear that the prices have cycled around each other as intended. This shows that the internal token economy is functioning correctly, allowing traders to profit by trading along with the cycles.

After September, the token economy will begin its second cycle. Between now and then, traders will trade other tokens for Winter, gaining more tokens in total, and positioning their portfolio to take advantage of the effect of the halving.

Over the years, as the token economy developed, the Seasonal Tokens community has grown on Discord, with thousands of users participating in games, quizzes, contests, and other events every day. A sneak peak of the community’s activity can be seen here.

Joining the community is highly recommended for anyone interested in investing in the tokens. The community active and helpful, and members receive tips in tokens for taking part in the activities, as well as frequent airdrops. It’s an easy way to get some tokens for free, as well as learn about the token economy, mining, farming, and investment strategies.

Disclaimer: Nobody can predict future prices. The rates of production of the four tokens are guaranteed to cycle around each other, and the prices tend to cycle around each other because of the influence of supply on the market prices. Markets can, however, behave irrationally, even for long periods of time, and so it is possible that the future prices will not behave as expected.