After rockets, blockchain has become the prime technology of the century. With blockchain comes the crypto revolution. There are tons of cryptocurrencies powering digital wallets and are used in peer to peer transactions in a decentralized environment.
Cryptocurrencies are fast, secure and completely decentralized. Any individual transacting in cryptos has total control over his/her finances. Despite the benefits, why is it failing to replace fiat currency and drive mainstream adoption? Well, the answer is hidden in high gas fees, poor UI and inability to seamlessly convert cryptocurrency into fiat.
To overcome such limitations and encourage mass adoption, here comes the AMP coin. It can power digital transactions at your local store, offer faster settlements, instant conversion to fiat and has friendly apps. Too good to be true? Let’s find out –
What is AMP Project?
Crypto transactions are picking up the pace by challenging the traditional payment methods including cash to cash transfer. However, they’re lacking in mass adoption because of the reasons shared above. In order to spur the adoption rate and mitigate the uncertainty surrounding cryptocurrencies, we have AMP that brings the solution to the table.
Before you get confused, AMP and AMPL are two different projects
AMP project is the creation of New York based Flexa network Inc. founded by Daniel C. McCabe, Trevor Filter, Tyler Spalding and Zachary Kilgore in 2018. Before understanding AMP, it is important to take a look at the Flexa network and its features.
Flexa is the first network to offer digitally secured transactions. It does not pass any sensitive information like customer details to process the transactions. Instead, it uses a unique and encrypted authorization code that cannot be reversed.
With the use of authorization code, complete payment amount is transferred from the customer’s account balance and converted by Flexa network at a lightning fast speed with 100% settlement guarantee. Checkout the list of cryptocurrencies supported by Flexa network.
Flexa held the ICO of Flexacoin in 2018 followed by the release of apps (including SPEDN & GEMINI) supporting Flexa network. Since the technology behind Flexacoin does not support staking, the team introduced AMP coin. Flexacoin holders were able to swap their coins to AMP in a 1:1 ratio. This was the birth of AMP project.
What is AMP Coin?
AMP is an Ethereum based ERC20 token. It is a collateral token designed to decentralize the risk in the payments, thereby reducing the assurance cost from existing networks. In order to understand the need for AMP coin in Flexa network, let us understand how it works.
The total supply of AMP tokens is capped at 100 billion
How does AMP Coin and Flexa work?
The whole idea is to have a legal & centralized payment operator (Flexa) and a decentralized network (AMP) for faster and secure payments that support a range of cryptocurrencies with the ability to settle payments in fiat.
Users can pay the merchant using supporting apps like GEMINI. Merchant will scan the QR code on the user’s app and the funds will be automatically transferred to the merchant’s account. In the backend, the app will process the request and swap the tokens to the favoured currency set by the merchant which further reduces the gas fee.
The process sounds simple but there’s a catch. Most of us are aware of card frauds like payment confirmation without the actual transfer and the time it takes to convert cryptocurrency to fiat. To overcome these two hurdles Flexa introduced AMP coin, which is used as collateral in every transaction.
Collateral assures the merchant that he will receive funds once the transaction is initiated by the buyer. For example, when a buyer initiates a payment to the merchant worth $100, the network will use AMP coin worth more than $100 as collateral, let’s say $105. Somehow, if the payment didn’t go through, the merchant will still receive his $100, paid from collateral which is converted from AMP to fiat currency.
Flexa supports 26 cryptocurrencies and 5 stablecoins
Staking AMP Coin:
Staking AMP is pretty much a straightforward process. Users have to visit the staking link and connect preferred wallet from the list shared below –
Once the wallet is connected, user can click the explore tab to display the staking option. After choosing the preferred staking option, user will have to visit the connected wallet and click the stake button below the AMP tokens. Choose the app on which you wish to stake tokens and that’s it, it’s done.
It is important to notice that the total AMP displayed in the staking pool are the actual tokens used as collateral for the transaction which means the system can support fixed number of transactions where AMP can be used as collateral. Staking help the users receive a cut in the fee paid by the merchants.
Staking AMP will earn just 1.98% APY
Unstaking AMP Coin:
Despite the low staking reward, users stake AMP on Flexa because it has no cooldown period. Users can unstake the tokens anytime without worrying about the locking period. It is important to remember that the tokens will be unstaked back to the address from which it was staked. Users have to use the same address to stake and unskate AMP tokens.
AMP users can vote on the proposals presented by the community which includes partnerships, cross-chain integrations, DeFi collaborations and more. The governance conducts off-chain voting via Snapshot –
Steps to Proposal Submission:
As the name suggest, this step introduces the proposals publicly to the AMP community forum for discussion and feedback. Proposals have to be live in the forum for 48 hours prior to submission.
In this step, the proposals are submitted to Snapshot. The submitter must hold atleast 1 billion AMP (1% of the total supply).
For a successful vote, a quorum of 5 billion AMP (5% of token supply) must be achieved and the vote has to be active for atleast 48 hours. Votes are passed by a simple majority.
AMP Coin Token Distribution:
Since Flexacoins are swapped to AMP coin in a 1:1 ratio. The tokenomics will follow the same suit. AMP is capped at 100 billion and there won’t be any created in the future. The breakup can be seen in the pie chart shared below followed by its vesting schedule.
Notice that the vesting schedule ends in 2045, which may suppress the price for the long term since more liquidity will add to selling pressure.
AMP Coin Benefits:
The concept of collateral token is a proven concept after the deployment of AMP. Since AMP is successful in digital payments for Flexa, it can also be successful on the related platforms or decentralized protocols.
The coin can be used by lending platforms like AAVE crypto or by DeFi protocols that are in the initial stages of development.
The AMP smart contract and the related resources have been audited by independent security researchers at Trail of Bits & ConsenSys Diligence, adding an additional layer of credibility for its users.
Multi Crypto Support:
Flexa supports a range of cryptocurrencies that help expand its userbase dealing in cryptocurrencies which ultimately increases the utility of AMP token.
With AMP, Flexa guarantees 100% payment settlement. In case of network congestion or delay, the merchant still receives the payment, all thanks to AMP collateral token.
AMP is an ERC20 token which makes it compatible with Ethereum wallets. From Metamask to Trust wallet, you can store AMP coins hassle-free.
When it comes to partnerships, Flexa is leading the race by partnering with giants of the industry. It has already onboarded Aurus Inc. to bring digital payments for retail users and has expanded into the e-commerce space by partnering with WooCommerce, Magento and Shopify.
More transactions on the platforms will increase the demand for AMP coin
AMP Coin Drawbacks:
AMP doesn’t have a roadmap which can help predict the future development of the project. This is disheartening, as it limits the future utility of AMP tokens.
AMP offers the lowest staking reward when compared to other staking platforms like Pancakeswap crypto. Staking reward is roughly around 2% which is unattractive for the users.
No Locking Period:
Stakers can unstake AMP tokens anytime. Users may think of it as a benefit but in reality, it’s a big drawback for the whole network. Staked AMP is used as collateral in the transactions. Imagine if users unstake a large chunk of AMP tokens, the network has to compromise guaranteed settlements which is its USP (Unique Selling Proposition).
There’s no clarity on crypto laws. How it should be traded, the tax cut, the conversion policy etc. We have already witnessed the Bitcoin crackdown by China, imposing ban on cryptocurrencies across the nation. Though AMP has a legal operator i.e Flexa, it is still a crypto token that falls under uncertain regulations.
AMP Coin Price:
Please check the latest AMP Coin price, shared below –
AMP Coin Price Prediction:
Let’s make things clear before I give any price estimates. AMP is a collateral token that acts as a security for the merchant if the transaction doesn’t go as planned. AMP is not the native currency of Flexa network. It is there to support the whole ecosystem and make it trustworthy for the users.
The coin has a pretty stable ride in the recent bull run and market crash. It briefly hit $0.10 and later fell back to $0.04. Taking a look at the price chart, it’s pretty clear that the coin lacks volatility which is an essential requirement for bigger price moves.
The technicals and the total market cap complete the puzzle. If the token has to hit $1, it will have to at least surpass Cardano ADA market cap and break the resistance zone of $0.06. It’s going to be very hard for AMP to aim for $0.50. In the best-case scenario, I will certainly limit my price prediction to $0.20 but will be a random guess. All you need is to wait for the breakout and hope for better volatility.
Where to buy AMP Coin?
Is AMP Coin worth Investing?
As explained earlier AMP is a collateral token and not a cryptocurrency. It is not used as a primary settlement token. AMP is more like a plan B which is deployed if things go sideways. Clearly, the coin lacks in volatility and hasn’t been able to impress the investors in the bull run of 2021.
The app is great and Flexa works like magic. Taking a look at the coin fundamentals and technical charts, AMP is clearly not worth investing unless it becomes a primary token of Flexa or any other decentralized application which in my opinion won’t be happening anytime soon.
What I believe, AMP should have a broader use case like a lending token for merchants that help them grow their business and more. It looks like Flexa is not much focused on it, Don’t believe me? checkout the project’s roadmap. Well, there isn’t any. So far, things have worked well for Flexa but for AMP investors, it may not churn out profits anytime soon.
This completes my review of AMP coin. In the next post, I will talk about 0x Protocol (ZRX coin) and LooksRare (LOOKS Coin).If you’re a fan of blockchain technology then please do share this post on your social handles and educate everyone around you. Do remember to subscribe to my YouTube channel for more informative content, released every week.
Cryptocurrency is a highly volatile market. All the information shared in the post is for knowledge purposes only. By no means, it’s financial or investment advice. Readers are responsible for their own investment decisions and should only invest in cryptocurrency after proper research.
An MBA in Marketing. Paras have a decade long experience in the corporate world. He is done with office politics and corporate life, therefore decided to move on and jumped on building Katoch Tubes. He is a crypto fanatic and has the vision to bring cryptocurrency knowledge to every household in the simplest form possible using the power of internet. His area of expertise includes online marketplace, cryptocurrency and content strategy. Reach out to him on Twitter & YouTube.