Aptos native token APT is definitely one of the most interesting crypto assets in the first half of 2023. The coin soared nearly 460% in April this year, continuing to climb from a low of $3.08 to a peak of over $20. So, what exactly is APT coin? Why did Aptos, a network with few users and developers, suddenly explode this year? This article will conduct a detailed analysis from three aspects: DEX, market demand and short positions.
Aptos (APT) Market Overview
Aptos is an emerging public blockchain developed by a team at Facebook parent company Meta that has been making waves in the crypto space since its launch in October 2022.
What is Aptos (APT)?
Aptos is an L1 public chain project developed by a former engineer for Facebook's Diem project. The blockchain uses a Proof-of-Stake (PoS) consensus mechanism, which places Aptos among other blockchains such as Bitcoin, Ethereum, and Cardano. The network’s main value proposition is scalability, claiming to be able to handle 10,000 TPS while aiming to reach 100,000 TPS.
Aptos is known for its large-scale venture capital investments at overvalued valuations, raising $200 million at a valuation of over $1 billion in March 2022 and $150 million at a valuation of over $2 billion in July 2022 . Notably, these rounds were primarily participated by the now-bankrupt FTX Ventures. Additionally, Binance’s follow-on investment in September valued L1 at over $4 billion.
On October 17, 2022, the Aptos mainnet was launched. Developers can write their own smart contracts using the Move programming language. This programming language ensures that smart contracts can be executed safely and quickly. The network can execute large volumes of transactions, allowing for fast transaction processing. This high transaction throughput is possible because transactions are processed in parallel.
What can Aptos (APT) be used for?
Aptos supports the development of smart contracts. Therefore, developers can build their own decentralized applications on Aptos’ blockchain. They are also able to develop and run cryptocurrencies on Aptos.
This makes Aptos a blockchain that can be used by developers, but also important for end users. Aptos says these end users will be able to use applications securely, quickly and cost-effectively. Many competitors do not offer this feature because they face the blockchain trilemma. This trilemma means that a blockchain can only satisfy two of its three main characteristics (security, decentralization and scalability), whereas ideally it should satisfy all three.
Who are Aptos’ competitors?
Of course, Aptos is not the only Layer 1 blockchain to support smart contracts. Therefore, Aptos has a large number of competitors. Competitors of Aptos include:
Ethereum
Cardano
Solana
Polkadot
APT coin introduction
APT is the native token of the Aptos platform.
1. Purpose of APT currency
APT tokens are used to pay transaction and network fees on Aptos. All transactions on the network are subject to a fee, specified in Aptos tokens. Validators will have the opportunity to prioritize the highest value transactions on the Aptos network and discard lower value transactions. When the system is at full capacity, the blockchain can still operate efficiently. Eventually, network fees will also be deployed so that the cost of using Aptos is proportional to the cost of deploying the hardware, maintenance, and node operations.
In addition, APT can be used to conduct governance votes on protocol upgrades and on-chain/off-chain processes, and to secure the blockchain through a proof-of-stake model. Validators holding a minimum amount of staked APT tokens can participate in transaction verification on the Aptos blockchain. The benefit of being a validator is that they can decide the distribution of rewards between themselves and their respective stakeholders. Stakers, on the other hand, can choose any number of validators to stake their tokens to receive a pre-agreed distribution of rewards. Rewards will be distributed to validators and stakers at the end of each epoch.
Currently, the maximum reward rate for stakers is 7% per year, and this amount is assessed every period. However, the maximum staking reward will decrease by 1.5% per year until it reaches 3.25% per year. However, all reward amounts and mechanisms can be changed through governance votes.
2. Aptos Token Economics
According to Aptos, the total inventory of APT tokens is 1,000,000,000. Of these 1 billion APT coins, 130 million will be in circulation when the mainnet is launched (October 17, 2022). The number of tokens in circulation will continue to increase in the coming years. The APT token distribution method is as follows:
51.02% allocated to the community;
19% to teams, advisors and private investors;
16.5% to the foundation;
13.48% are investors.
On the other hand, investors and core contributors’ tokens have a 4-year lock-in period, excluding token rewards. Meanwhile, the expected token supply schedule is as follows:
To kick off the mainnet, the project airdropped a total of 20,076,150 APT tokens, representing 2% of the total initial supply, to a total of 110,235 eligible addresses. At the time, the team said: "This is our first airdrop based on existing community data. The Aptos Foundation will continue to evaluate future opportunities to support the Aptos community."
Aptos (APT) Price History
Launched on October 19, 2022, Aptos caught the attention of investors, surging to $10.25 within days of launch. However, this initial optimism faced serious challenges when the collapse of the FTX exchange had a devastating impact on the broader crypto market, including Aptos.
As a result, it hit an all-time low of $3.02 in December 2022. Despite the setback, Aptos has staged an impressive recovery. One of the main reasons is Aptos Blockchain’s announcement to join the Binance-led Web3 recovery initiative.
Aptos grew more than 500% at the start of the year, reaching an all-time high of nearly $20 on January 26. However, with the collapse of Silvergate Bank on March 10, its price subsequently fell to a low of $9.77. It subsequently recovered to trade at around $12.30 on April 17, 2023.
in conclusion：Aptos (APT), as an emerging blockchain project, has become the focus of the crypto market in the first half of 2023 with its high transaction throughput and strong technical support. Despite market volatility and challenges from competitors, Aptos has demonstrated strong recovery capabilities and potential. In the future, as more developers and users join the ecosystem, Aptos is expected to occupy a more important position in the encryption field.