Ampleforth (AMPL) – All you need to know

What is Ampleforth?

Ampleforth (AMPL) is a cryptocurrency that maintains a stable value by adjusting its supply in response to demand. Like Bitcoin, Ampleforth records all transactions on a decentralised blockchain; however, unlike Bitcoin, it has a fixed value instead of one that fluctuates over time.

In essence, this is a stablecoin, but rather than pegging its value to a fixed asset as other coins do, it simply adjusts the supply as the demand changes. Ampleforth was formed in 2018 and can be used as a hedge against both fiat currencies and other cryptocurrencies, or as an inflation-proof digital asset that will maintain its purchasing power.

How does Ampleforth work?

Ampleforth works by rebasing its currency every day in response to changes in demand. AMPL’s target value is $1, so whenever the price goes up, Ampleforth issues more coins to bring it back down. When the price falls below $1, it destroys coins to reduce the supply.

The crucial part is that rather than owning a set amount of coins, each holder owns a percentage of the entire supply and those holdings are never diluted. Instead, the amount you have in your wallet changes every day. Using ‘elastic supply’ in this way means the coin’s value is entirely disconnected from any real world asset, or even the performance of other cryptocurrencies.

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