can someone post a good explanation on why BNT is sinking every day?
It's because there is a flaw in the Bancor model and it's allowing the whales to game the system & take profits. Whales are buying at the exchange and selling to the contract small bit by bit due to the price discrepancy.
This drop will continue till the 120k ETH floor is completely gone. Then nobody knows what will happen. BNT can go into a free fall and never recover or it can start rising again. Nobody knows for sure because nobody can predict the market.
One things I do not understand is why they are doing it bit by bit. That part puzzles me.
That 120k ETH floor is the flaw. There is a huge incentive for the whales to crash the exchange price below 0.01 ETH and keep buying cheap BNT to sell to the contract because they know the contract price cannot go below 0.01 ETH. Any whale can put up a huge sell wall at 0.01 ETH to make sure the price doesn't go over that while they stock up on BNT.
I feel this is just the beginning, the worst is yet to come.
If the wall was not there, the whales would have pushed the price way below the 0.01 ETH mark already, bought up the coins cheaply and pumped the price to heaven. Now there is very little room for them to push it downwards, except if they can convince weak hands to go against the wall on their behalf. The 120k ETH floor is not the flaw, the flaw is people who are stupid enough to sell their BNT for less than 0.01 ETH in the open market. If the weak hands prevail, the price will eventually go below the 0.01 ETH mark. The whales will then have a feeding frenzy. Once they've bought up the coins cheaply, they will start pumping it like there is no tomorrow. Many of the weak hands will try to get back in, but at much higher prices.
Weak hands would sell on exchanges below ICO prices also because at the moment it's complicated to sell to the contract. Once the Bancor team releases their app to buy/sell this should not happen any more. I mean, you must be very stupid to sell cheap on one platform when you could easily sell higher on another one.
True. There is no excuse to sell below the ICO price, especially after Bancor posted this: https://blog.bancor.network/price-floor-smart-contract-deployed-621871bd09ca
