What do we mean by Asset Backed?

Have you ever asked someone a technical question then wish you hadn’t bothered? You know the kind of person I mean – the one who throws lots of fancy words around just to confuse you so you’ll think that they’re an expert, when they’re probably just talking gibberish?

At Assetereum we want to include our members, not confuse them. We don’t want to pepper you with jargon or bore you with a lecture; we want to explain to you how our token works in a way that’s clear so you can understand the benefits for yourself. And that’s because we think a great business idea speaks for itself, and the better you understand it, the more you’ll want to be a part of it.

We talk a lot about being asset backed but what exactly does that mean?

The majority of money raised from the Initial Coin Offering (ICO) sale is used to purchase assets and make investments that should generate income. This includes the already purchased businesses Utilico Energy and MyDiscountShop, strategic trading of other cryptocurrencies, investments into real estate and small enterprises and more. Anyone who holds tokens will be a part owner of these assets.

We can talk about the token’s value in two ways: the derived value and the market value. The derived value is the value the tokens have from the assets. While these assets remain worth something, the ASET token will retain a base value.

The market value is set by the exchanges. This is largely dependent on people’s perception of the coin; the simple fact that people believe it has value makes it valuable. This is why cryptocurrencies are such a confidence game – non-asset backed digital currencies only need to convince people that their coin is worth something to make it so. This is also why the prices of currencies like Bitcoin fluctuate so much, as changes in supply and demand cause the prices to rise and fall, often correlating with the circulation of positive and negative news on the topic.

The reason we say that Assetereum has increased stability is because its value should not fall below the value of the assets it is backed by. So, while the market value may be higher than the value of the assets as people see its potential to increase in value, it is not at the mercy of the exchanges for its entire worth.

Confidence in cryptocurrency is low following the bursting of the Bitcoin bubble in January this year. Mere reports of its value dropping caused it to drop further as people lost confidence in the coin and demand plummeted. Taking place shortly before our launch, we can’t pretend this hasn’t had a negative effect on our ICO sale, but our unique concept is still attracting some good attention, especially from alt coins holders, as people see the potential of a token that will be less susceptible to slumps like this in the future.