Both eyes in the cryptocurrency room have been laser oriented on ventures involving blockchain finance for the past several months (DeFi).
With supply-demand driven interest rates, flash loans, and crypto-collateralized stable coins, protocols like Compound, Aave, and MakerDAO have opened up a new world of financial possibilities. Ampleforth, a project that has recently gained attention for good cause, is one of these game changers..
Ampleforth is a DeFi protocol that aims to totally reinvent money both within and outside of cryptocurrencies. By developing a robust and resilient currency that can handle both inflation and deflation, it simultaneously solves the issues of classical finance and decentralized finance.
Ampleforth has a reputation for being difficult to absorb, with others claiming that it takes 2-4 weeks to completely comprehend.
What Is Ampleforth?
Ampleforth is a cryptocurrency that aims to change the way people think about income. The protocol's native token, AMPL, is intended to be used as leverage for decentralized banking schemes as well as a crypto-alternate economy's base-money. AMPL is an Ethereum-based ERC-20 coin that runs on the Ethereum blockchain.
The application of "countercyclical" economic strategy in the Ampleforth protocol distinguishes it from other DeFi protocols. Simply stated, as the market for AMPL grows, so does the availability of the tokens to compensate for price fluctuations. From an investing standpoint, AMPL's countercyclical aspect is advantageous because it has a low connection to cryptocurrencies including Bitcoin and Ethereum.
This type of scheme is ideal for maintaining a steady price medium of exchange over long periods of time. The aim of Ampleforth is to reintroduce commodity money without the strict constraints enforced by goods with limited availability and issuance, such as Bitcoin and gold.
Is Ampleforth a good investment?
AMPL could be a decent hedge option for those who are bearish in the current market environment. Because of its simple nature, the asset is not correlated to any other currency or asset, it would be less volatile in the event of a crash.
Is there, however, any long-term benefit to purchasing Ampleforth? We could see an increase in interest from DeFi developers due to the token's lower volatility. Users can use AMPL for any financial instrument (loans, yield farming, derivatives trading, etc.) which allows them to use their assets much more safely than in the past.
Ampleforth has strong links to both Aave and Compound, two of the most common lending and borrowing protocols. We might see a significant increase in AMPL's investment activities if they were to form a big alliance. But, once again, it hinges on acceptance rates.
Ampleforth would have an extremely optimistic view as long as it generates excitement. Otherwise, the worth of their tokens may be lost forever.
