Every time I think SPS can't hit a new low, the token surprises me. At just around 2 cents, SPS is in fact heading to zero and I'm left wondering why this is happening.
At the time of writing, there's little to no incentive to actually hold or stake SPS token. Yes, there's the APR from staking but considering how the token has been dumping in the past couple of weeks, I wonder if it is even worth it.
I don't have concrete data but it is safe to assume that the fact that the market price of the token is dumping so aggressively is a sign that people are selling it. I mean, it's not rocket science, that's just how the market works.
For what it is worth, we're still neck deep in a bear market and it is safe to assume that it is a contributing factor to the situation. However, I feel like there's a bit more to the story than meets the eye.
Let's look at things the way they are right now and ask ourselves if there's actually any reason to hold or stake SPS token. Let's take a step back from what ifs and fantasies to actually objectively look at the situation.
On the surface, where I like to dwell, it looks to me that SPS is doomed for the dump and you really can't blame the market for the decision. At the time of writing, there's really no serious reason to hold or stake SPS token.
SPS token was created to be the governance token on Splinterlands and regardless of the price, it will always serve that purpose but that's hardly enough reason to drive up demand for the asset. Most people don't even bother voting with their SPS stake because they feel like at the end of the day, it's just going to be whales making the final decision.
Other than being the governance token of Splinterlands, SPS also serves as an onboarding token to other Splinterlands-related projects. For example, the GLX airdrop you receive for the GLS sport gaming platform that is still in development.
The GLX token hype died down as expected, knocking everyone back a few pegs and now the token is trading at around the same value with SPS token. So, it is safe to say that the airdrop wasn't enough to pump SPS token that has even been dumping during the period.
On one side, the attempts to drive up demand for Splinterlands assets haven't exactly been working and on the other side, there's also an increase in the SPS printing rate. Ranked battles, staking rewards, validator licenses and Guild bralws are just a handful of ways SPS is being printed in-game, without even considering the liquidity pools.
I hate to say it but SPS is going to continue getting cooked because the demand is dwarfed by the overwhelming urge to dump it. It is s ad state but one that I think will persist until something dramatic happens in the market.
