Supply is a factor that directly affects prices in every field, and its impact on cryptocurrency prices is felt very quickly. Investors reflect developments that can change market balance to prices immediately with the opportunity to trade 24/7. The recent announcement for ENJ Coin encouraged sellers, leading to a price drop.
Following the token migration that started on September 13, a reward pool was announced to secure the Enjin Blockchain. Accordingly, 250 million Enjin Coin (ENJ) will be distributed in 10 equal installments starting from January 15, 2024.
To encourage the community to stake, a significant incentive was announced that will increase the circulating supply. Without stakers in PoS networks, the network is not secure, and high participation is crucial. Rewards will start from Block 3,247,000 and are expected to be released in 10 equal installments starting approximately from January 15, 2024. Each time, 25 million tokens will enter circulation, creating a risk of selling pressure.
The Enjin Blockchain currently consists of the Enjin Relaychain and Enjin Matrixchain, and transactions are processed on the Enjin Relaychain. To ensure the security of transactions, they must be processed by multiple validators. The Enjin Blockchain has an annual token inflation rate of 4.8927482% to support network governance, and new tokens are released every term.
Although this development is negative for supply in the short term, it supports network security and stake participation in the long term. Thus, a significant portion of the new and old supply can remain locked during the unlocking period of the additional annual lock, as the compound staking income is attractive to validators. The real issue is what the ENJ Coin team will do when the stake reward pool is depleted.
In this article, it is stated that ENJ Coin found buyers at $0.311, turning its direction downwards after the peak of $0.37 due to BTC sales. The $0.3 support has been tested twice and is strong, and it can stay in place for now unless BTC suffers a significant loss. However, if the support is lost, sales can continue down to $0.275 and $0.2.