AMP, the token of the Flexa collateralized asset transfer network, bounced back higher than its earlier drop on Friday as it recovered from the market’s shock at the invasion of Ukraine by Russian forces.
But AMP continues to show sharply volatile traits, and today (February 28), it is down 4%, further punctuating its price chart with more sharp rises and quick falls. It was typified on February 10 when the price rose 14% and then plunged back down in just five hours.
Zooming out on that price chart, it is clear there is a long-term bearing trend on AMP. Since June last year, when it hit its all-time high, it has fallen with the occasional spike of declining amplitude. Since that high, it has lost 78% of its value and is now at its lowest point since last March.
Like many cryptos, AMP has a plausible use case – in this case, helping to provide users with fast, secure transactions – but a general gloom hanging over the cryptocurrency space can undoubtedly take some of the blame for the price’s lack of sustained growth.
However, that use case is predicated on insecurity some people feel about doing business with crypto. It is possible that as crypto becomes more mainstream and confidence grows, the service may become redundant.
So what’s next for AMP? Can it convince the market of its value? Can it gain momentum and break out of this long, disappointing decline.
What is the AMP crypto coin?
The AMP coin is unique in several ways. It is designed to decentralize risk in a payment transaction by dramatically reducing the assurance cost from existing counterparty networks and incorporating a novel partition interface to facilitate the interoperability of staking contracts for any surety mechanism.
AMP is ERC20-compatible and operates as the exclusive collateral token of the Flexa network, a merchant network that accepts low-cost digital payments in a fraud-proof manner.
Payments are guaranteed in real-time using AMP as collateral, which decentralizes risk, while proceeds from merchant fees are used to autonomously open-market purchase AMP tokens. The tokens feature on-chain collateral managers, otherwise known as smart contracts, which lock and release AMP as collateral for transactions made with other cryptocurrencies.
Flexa network applications can supply AMP to a designated smart contract via meta-staking. This process requires participants to stake AMP into pools that secure the network.
It is worth noting that the AMP token contract is immutable, and collateral pools are permissionless so that participants can supply/withdraw without time, financial or competitive restriction.
AMP can be described as a form of transaction insurance because if a transaction on the Flexa network fails due to lengthy transaction times, the AMP cryptocurrency steps in to offset those losses.
But what is Flexa’s role in the transaction process? Flexa integrates natively with existing point of sale (POS) systems and online platforms to enable payment in a typical checkout experience. The network includes various exchanges and financial institutions to provide complaint settlements across multiple jurisdictions.
More specifically, Flexa decentralizes transaction insurance, decoupling merchant settlement from the initial consumer payment to provide immediate finality-as-a-service, thus enabling payment functionality, applications, and communities to stake AMP tokens on behalf of users collectively.
In other AMP crypto news, users worldwide have staked nearly $1.1bn in AMP to back Flexa payments as of January 18. It was $1.3bn on January 6.
It had received a 40% boost to its price on November 23 when leading exchange Binance announced it was making AMP available to its users.
On December 1, Flexa announced that Solana’s asset, the SOL, would be accepted on the network. It said, means “the fastest blockchain meets the fastest and most fraud-proof payments network.”
On January 7, it was listed on the exchange Bitstamp for the first time.
Let’s take a look at the latest news and developments, as well as the long-term outlook for the AMP cryptocurrency price.
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AMP price analysis: Technical view
The AMP coin started at $0.00953 on September 11, 2020. It sustained that price level until February 4, 2021, when it reached $0.01138. The token registered a spike on May 25, 2021, trading at $0.039.
On June 10, AMP was listed on the mainstream cryptocurrency exchange Coinbase, leading the token to hit an all-time high of $0.121 on June 16, 2021, according to data from CoinMarketCap.
AMP reached $0.04524 on October 31, but the price has been getting condensed between narrowing highs and lows in the last few months.
The technical analysis provided by CoinCodex on February 28 showed that short-term sentiment on AMP remained bearish, with four indicators displaying bullish signals and 20 bearish.
The daily simple and exponential moving averages are giving sell signals, according to data from TradingView, while the Relative Strength Index (RSI) was at 42.29 (February 28). An RSI reading of 30 or below indicates an oversold or undervalued condition. Trading View’s overall recommendation was a sell.
AMP coin fundamental analysis
The AMP token, which serves as a particular type of collateral within Flexa, appears to have benefited from a listing on the Coinbase trading platform in June 2021.
More people now have access to buy and sell AMP as a result. It has led to a steady increase in the digital collateral tokens popularity. AMP could also benefit from the fact that cryptocurrency investors can now earn income through staking, a process whereby an individual earns passive income in addition to their token price gain.
As a whole, the rise of global token networks has fostered a spectrum of innovative projects with features specific to spending utility, low-volatility protocols, pegged assets, and synthetic commodities.
A benefit of AMP is that the protocol provides an entirely autonomous collateralization system. Typically collateralization means that users are dependent on a third party. However, AMP removes this requirement by offering a decentralized digital alternative.
Another major plus is that the AMP network provides real-time finality assurance, which boosts the token. A drawback of cryptocurrency payments can be the time that transactions take to be completed at the point of sale.
The AMP network is incredibly unique because users can collateralize their assets instantly. It makes the protocol both scalable and suitable for the needs of a growing digital economy. Not to mention that AMP users enjoy a high level of interoperability. As of June last year, the protocol supported over 25 digital assets.
Risks ahead for AMP
Cryptocurrency markets have been subject to high volatility, driven in part by varying perceptions of the intrinsic value of crypto as a store of value.
Various upward and downward price movements have taken place over the last few years. For example, in May 2021, bitcoin plunged by as much as 30% to about $30,000.
As a native utility token of the Flexa network, AMP is a relatively new project, launched only in September 2020, which means it is still on its journey of achieving broader adoption.
While cryptocurrencies such as AMP have been hailed as potentially disruptive financial technologies, technological barriers remain, which may affect the crypto-asset ecosystem as a whole.
AMP has a non-inflationary, fixed-total supply of tokens, which could rise in value directly from broader adoption, notwithstanding the risks facing the digital collateral token.
AMP coin price prediction
Regarding an AMP token price prediction, on February 17, the algorithm-based forecasting service Wallet Investor saw it as a bad short-term investment. Based on historical data, Wallet Investor saw the price falling to $0.0028 in a year and hitting $0.0059 in five years.
DigitalCoin Price expected the token to grow to $0.038 in 2022. The forecasting company saw AMP rising to $0.06 in 2025 and eventually hitting $0.1 in 2028.
Coinjournal’s cryptocurrency analyst, Motiur Rahman, said that AMP addresses a vital segment of the crypto industry. The collateralization of assets gives the industry a new dimension.
“Users will be able to use collateralized crypto assets in contract finance and credit finance. There is a lot of wealth already tied into the cryptocurrency industry, and AMP opens the door for unlimited applications in real-life situations,” Rahman told capital.com.
“Although the coin recently spiked, trading at a new 30-day high, it is still several levels below its yearly highs of about $0.11, which leaves a lot of room for the rally to continue”.
Overall, as more merchants integrate payments capabilities with Flexa, AMP’s use case could become more robust, potentially boosting the token’s price.
Note that algorithm-based price predictions can be wrong. Forecasts shouldn’t be used as a substitute for your research. Always conduct your due diligence before investing. And never invest or trade money you cannot afford to lose.
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