Ampleforth — the developer of a new synthetic commodity designed to diversify risk — has released an updated white paper for its digital asset protocol.
According to the press release, the design for the Ample token — expected to be traded under the ticker symbol AMPL — is intended to resist price correlation with both traditional assets and large market-cap cryptocurrencies such as bitcoin (BTC).
As Ampleforth notes, while cryptocurrencies as a sector have thus far broadly shown non-correlation with traditional asset groups and macroeconomic factors, within the crypto market itself, many large-cap coins have ostensibly shown strong correlation with one another.
Ampleforth thus hopes that its protocol design — which propagates nominal exchange-rate information into token supply — will result in lower intra-market correlation for its token, thereby mitigating non-diversifiable risk for crypto investors. The press release outlines that:
“The Ampleforth protocol […] receives exchange-rate information from trusted oracles, and propagates that to holders of Amples by proportionally increasing or decreasing the number of tokens each individual holds, according to the magnitude of the exchange rate fluctuations over the previous 24 hrs.”
The new asset is furthermore designed to mitigate volatility — yet is distinct from a fiat-pegged stablecoin, with the white paper outlining the algorithmic basis upon which the token’s supply policy will prospectively result in minimal price pattern deviations. It has reportedly thus far raised $4.75 million in funding to finalize development of its protocol from investors that include Coinbase co-founder and CEO Brian Armstrong, True Ventures, Founder Collective, Slow Ventures, Pantera and FBG.