Unisocks Price $SOCKS And Those Famous Dutch Tulips

Thanks to the DeFi craze, socks are now like those famous 17th century Dutch tulips. You can buy your unique pair of socks at the Unisocks exchange. There, you will be able to buy a pair of socks for thousands of dollars under the premise that they are scarce. How cool is that for those who produced the socks?

Collectible Crypto-Themed Socks

We like our Bitcoin socks. That is why we gave Mt Socks a thumbs up. This company has amazing designs that are affordable, and each design is a limited edition. All of the socks that Mt Socks sells are sensibly priced.

These are the socks you can expect if you redeem your $SOCKS. Are Unisocks an official Uniswap project?

So, if you want your socks and still be able to eat after you pay for them, Unisocks is not for you. On the other hand, if you want to hop on the hype wagon and buy tokenized limited-edition socks believing that the price will continue to rise eternally, go for Unisocks.

About Unisocks & $SOCKS

Before you do so, here is what you should know about this latest tokenized scarcity theme that hundreds of people have already bought into:

  • Only 500 pairs of Unisocks will ever be made
  • These are all tokenized – $SOCKS
  • To buy and get a pair delivered, you must acquire $SOCKS and redeem it
  • Unisocks $SOCKS tokens are divisible – yes, you can buy a fraction of a pair of socks and use it as a tradeable crypto asset
  • Supposedly, there is a price spread between the Uniswap price of the token and the price on the Unisocks exchange
  • Investors could take a risk and engage in arbitrage
  • The price of a pair of socks on the Unisocks exchange is pre-determined; the value supposedly follows a formula
  • That Unisocks value formula is as follows: socks value in USD = ETH price in USD * 17,500 / (500 – socks sold) ^2
  • Pre-determined prices of Unisocks go as follows: 1st pair is 0.07 ETH, 499th pair is 8,750 ETH
  • The 500th pair “cannot be purchased with all the ETH in existence”

Unisocks: Beyond Exorbitant Prices

These prices and value formulas are baseless of course. In a free market, prices are determined by the point where supply and demand meet. You can assign an exorbitant price to whatever you want, but that means that there might not be anyone to buy what you are selling.

That “value” formula? You can find it in your Unisocks box when you redeem your $SOCKS.

Without demand, scarcity evaporates. Demand drives scarcity and there are hundreds of examples to prove that. Here are some:

  • Peak oil was a farse and prices are unlikely to reach the $100 USD mark again if you control for inflation; oil is no longer scarce
  • Tulip prices – probably the most salient example of how scarcity depends on demand
  • Beanie Babies – most of the prices of these plush animals plummeted to 1% of the original price by the early 2000’s simply because there was no demand
  • ICO token scarcity after a critical mass of people realized that the projects will not deliver on what they promised

Value Formulae?

The Unisocks valuation model is probably more egregious than its false scarcity theme. Anyone can come up with a valuation formula for anything. That does not mean the formula is based on any kind of empirical truth.

Generally speaking, valuation methods are based on accounting. Appraisers, businesspeople, and investors use these valuation methods to assign a price to a business or asset, as objectively as possible.

How can you appraise socks with a formula? People who engage in appraising or evaluating the value of an asset, rely on the following:

  • Market price
  • Dividends or expected dividends
  • Cost of capital
  • Cashflow projections
  • Stock and stock replacement – the famous S2F model some follow on Bitcoin prices

With Unisocks, the formula is arbitrary:

  • Unisocks yields no dividends
  • The market does not determine the price of the socks
  • Manufacturing socks is quite an inexpensive process that anyone in the textile industry can follow

Do Unisocks Have a Blockchain-Backed Certificate of Authenticity?

The only leg on which Unisocks could stand on, is a blockchain-backed certificate of authenticity. Besides that, anyone could buy a pair, copy the design, and mass produce exact replicas. So far, it is our understanding that Unisocks tokens allow you to redeem a pair of socks but do not serve as a certificate of authenticity.

Even if Unisocks had a blockchain-backed certificate of authenticity as some kind of objective measure of value, the certificate would be on Ethereum. If you don’t remember, the DAO debacle showed us Ethereum is not immutable.

Those certificates of authenticity would therefore be less valuable, objectively, than certificates of authenticity on the Bitcoin blockchain.

Buy Unisocks & Trade $SOCKS at your Own Peril!

Nevertheless, we are aware that people are bound to buy Unisocks or fractions of a token on Uniswap. If you are familiar with our articles, you must already know what we are going to say next. Irrationality is inevitable!

All we can do is show you the other side of the argument as objectively as possible and hope you do not fall into a blockchain version of Tulip mania! If you want crypto-themed socks that have unique designs and limited production, head right over to Mt Socks and buy them for a reasonable price!