KCS valuation strategy
It’s in the exchange’s interests and KCS holder’s interest to increase its valuation. However, I feel like there’s more that could be done for increasing the valuation in a very realistic and non-cheap way. Thus, I suggest lowering the amount of fees for KCS holders even more.
This could bring more value to the exchange’s token, and potentially bring in more liquidity as trading would be cheaper. For example, if you’re selling $5 coffees, and only sell one per day, try selling the coffees for $4.50, you know you’ll still sell one, as you have the reliable customer, but it may lower the barrier for someone that thinks $5 is too much.
Overall, it’s worth a shot. Kucoin could turn into the “cheapest” place to trade as well, which would bring in more liquidity and increase the value of KCS and thus feed back into funding Kucoin’s projects.
* Edit : Extra note, Binance and Kucoin’s base trading fees are both 0.1% — why can Kucoin not attempt to undercut the competition right here by lowering the fees to 0.09% for someone that holds no KCS? Considering the example above, the $5 coffee can be found in the city centre, where the payment is mostly based off convenience (Binance, liquidity) whereas Kucoin is offering coffee for $4 slightly outside of town. At the moment, Kucoin is attempting to charge $5 for a cup of coffee. I don’t understand why Kucoin hasn’t attempted this approach yet.
They have an excellent exchange i like it more than binance, they just don’t have the brains or the money to grow a big userbase, i would even take it a step further and get rid of trading fees for new users for like a month, if they send funds over from binance. They have to attack binance directly not just try to attract users.
What data do you have on the fee to volume elasticity? I’d be interested to see it.
I agree with you that the most important thing Kucoin can do to survive is increase their volume. KCS price should follow volume; not be pumped temporarily by promotions. From what I’ve seen this year Kucoin is blowing through money. The extra weekly burns alone have been a huge chunk of change. I think their heart is in the right place but they don’t have the vision to execute it properly.
Here are some simple volume producing tactics:
1) New accounts that transfer fresh assets to Kucoin pay no fees on trades and withdrawals for the first month. Basically, what’s your incentive not to at least TRY the exchange?
2) Integrate with Defi such as by making a Fed Kyber Reserve powered by the Kucoin order book. When someone liquidates their CDP and Kucoin has the best price let’s secure that volume.
3) More soft staking. You can trade on Kucoin and get staking rewards on your assets or you can leave them on another exchange and get nothing.
4) Change the KCS hodl program to distribute another token that is a proxy for KCS and continues to reduce your trading fees. Increase the buyback percent to 100% from 90%, lower the APR to 10% from 50%. Make it strictly better than lending DAI. Use the buyback to supply the burn reserves.
5) Increase transparency and trust. When calculating your KCS rewards show us a pie chart of what percentage of volume paid what fee.