Why Investors Should Be Paying Attention to FUEL
For anyone who’s had to work with a lawyer before and wondered “why is this so expensive?”, the answer is usually because where there is a high degree of complexity, there is also risk. Lawyers are brought in to mitigate this risk by building contracts that factor in the complexity.
But this is hardly the most efficient way to do things. All these service oriented contracts have to run through middlemen or centralized companies, which leaves the counterparties exposed to any security risks these middlemen might have.
Smart Contracts as a Solution
Potential attacks can be mitigated by using smart contracts to eliminate the central party risk. This is what Ethereum was designed to do: create a decision-making system that wouldn’t be vulnerable to third-party tampering.
Even though Ethereum is able to support DAOs and DACs, it isn’t the easiest platform to work with as a developer. This is largely because of the requirement that programmers use Solidify, which is considered to be an esoteric language.
Etherparty to the Rescue
Where Etherparty comes in is that it delivers improved ease of use. They are actually marketing themselves as doing the same thing for DAOs that Wix is doing for websites. By being safe, reliable, and easier to get involved with, they have the potential to become the de facto platform for many of the broader and more marketable applications that will surface within the blockchain ecosystem.
There are templates for creating smart contracts already stored in the cloud, and all contracts are settled using the proprietary token, FUEL. Any transaction or execution requires FUEL, which is where the natural demand comes from, but there the contract payout amounts are pegged to USD to avoid having fluctuations of the FUEL price affect the payout.
The business model is similar to a subscription, where a monthly fee determines how many features the user has access to, as well as the level of integration. From an investor’s perspective, this creates a constant revenue stream and “demand” for FUEL that could do great things for the price.
The technology of creating agreements between parties is definitely in high demand, and the question becomes: is Etherparty the likely winner in this space? We can’t know for sure, but the current pricing is very appealing. Sometimes a deal makes for a good incentive to invest in an already competitive space.
Currently ranked at 372 in terms of market capitalization, the buying case for FUEL is more of a long-term one. It can be purchased on Binance and has just start to test resistance levels again.
The November high was around 400 satoshis, and based on the current trading patterns, that could be a possibility if FUEL were to break out of the 210-240 satoshi range. Having a smart contract creation tool will become increasingly important as the industry continues to advance and more companies want to use the blockchain. One thing is clear, the coin is down from all-time highs and has potential to be a runaway hit in this down period we are currently experiencing.
Disclaimer: The author owns Bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
Featured image courtesy of Shutterstock.