All the hype has died down after the recent spike in NEM (XEM) saw the coin positioned ninth on the Coinmarketcap listing. The coin saw a 44% rise on Wednesday to move into the top ten largest coins according to market capitalization for the first time this year. A day later, the coin’s price moved in the opposite direction losing over 35% of its value. This saw XEM close the day as the worst performing coin amongst the top 50 coins.
NEM.io is a platform created on March 2015 that brings this capability to the virtual currency market. What it does is allow more than one party to be listed as a signatory and requires all or some of these signatories to approve before a payment is confirmed through the platform.
The growing number of cryptocurrency platforms have focused their products on the public to individuals. The large section of the economy that is driven through vehicles of pulled resources offers a large market with great potential for growth and innovation for the fast growing Fintech sector. NEM is filling this gap.
NEM, through the NEM blockchain community fund is exploring opportunities for application of its systems by raising funds to help organizations integrate their systems and products into its blockchain. Digital2Go Media Networks, Inc. (D2GO), a location Core platform wants to integrate into the NEM blockchain and through the foundation has raised 1.8 million XEM towards this. At the time, this was equivalent to 1 million USD valuing a XEM unit at 0.5556 to the dollar. Other firms currently on the NEM blockchain include Incipo Alamo Rental cars among others.
The fund is currently valued at 300 million XEM translating to almost 110.46 Million USD (The price has since dropped to 0.3682 to the dollar as of today, March 15 2018). This represents a 33.7% drop since the recent cryptocurrency.
Over the last 3 months, the cryptocurrency has traded between a high of 2.09 on January 4th and a low of 0.2831 on March 8th to the dollar. XEM has about 9 billion units in circulation with a 3.258 billion USD market capitalization and 134.163 million USD worth of its units traded today. This presents a 22% drop from yesterday’s rally that saw the price hit $0.5 USD. With its unique proposition focused on group funds, XEM ranks 12th in the cryptocurrency market. We may see other platforms expand their product offering to this section of the economy in the future. Going by its current performance, and it being among pioneers, NEM (XEM) places well to take the lead among its peers.
Cryptos have experienced high fluctuations since their introduction and this can be attributed to a number of factors. Since the available units are normally fixed e.g. 9 billion for XEM and around 13 million for bitcoin (BTC), their price as an asset at a given time is affected by speculation by investors. Also, as a large portion, of the available units are often held by a few individuals, liquidation to traditional currencies like the dollar is often challenging without creating large movements in the market price.
Their digital nature also exposes them to security concerns from hackers and breaches, which affects investors’ decisions to buy or sell the currencies. A recent hack on Coincheck led to 260,000 customers losing their XEM holdings resulting in the firm distributing 440 million USD of its own funds to these customers as compensation for their losses.
Despite these challenges, the adoption of NEM (XEM) and other virtual currencies is poised for growth. Continued innovation and exploration of more opportunities for this system of payment remains a key driver for this growth.