The current imbalance market of COTO & IGG

Discussion in 'General Discussion' started by Adrian (Kung Fu Master), Apr 15, 2018.

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  1. Adrian (Kung Fu Master)

    Adrian (Kung Fu Master) Avatar

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    Many Players and Devs are concerning the high price of COTO. However, we should not be alarmed by this because COTO and IGG are trying to balance each other out.

    Given:
    $1 = 6,667 gold (Average exchange rate between Players)
    Breakdown:
    $150 = 1,000,000 gold (Check the player marketplace forum)
    =1,000,000 / $150
    = 6,667 gold.

    $0.87 = 1 COTO (Fixed rate set by Devs: 115 COTOs = $100 USD)

    Therefore:

    (6,667 x 0.87) = 5,800 gold = 1 COTO

    Currently, 1 COTO floats around 4,000-4,500 gold which is considered undervalue. Players would be wise to buy gold from other players, and then turn around buying COTO valued at 4500 per in racking up more COTO over buying from the online store.

    $100 = 666,700 gold / 4,500 gold = 148 COTO vs 115 COTO for $100. Devs’ revenue lost due to the imbalance in exchange rate.

    ---------------------------------------------------------------------------------------------------------------------

    Food for thoughts for the Developers.

    Given:

    $100 = 666,700 gold

    $100 = 115 COTOs

    Why is there an imbalance in the property tax and the online store? (1 COTO = 3,500 gold). Gold only valued at 402,500 per $100/115 COTOs in this case. At the current market, almost all players are paying their property taxes by gold instead of COTO. COTO are used for repairs and buying other in game items from COTO merchants.

    Recommendations:

    1) Increase the gold value in Property Tax to: 1 COTO = 5,800 gold. Result: Devs can keep the value $100 = 115 COTOs and leave the Players’ exchange rate alone.

    OR

    2) Decrease the online store fixed rate to: 115 COTOs = $53; Result in reducing online store revenue, but it is better than having no revenue at all at the current setup.
     
    Last edited: Apr 15, 2018
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  2. Solstar

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    I'm curious where you are getting your IGG to Cash valuation .
     
  3. Weins201

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    Player Driven economy not game driven.

    Yes there is a problem but it is much deeper than just CotOs.

    As a result you cannot look at just those to try and balance this economy.

    Need a lot more time to even try and force and influence.

    the real problem is Coto Drop rate.

    How is it that a players can sell cotos at 15-20% less than the store, when I have only gotten like 4 to drop in loot my entire time playing?
     
  4. Adrian (Kung Fu Master)

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    Breakdown:
    $150 = 1,000,000 gold (Check the player marketplace forum)
    =1,000,000 / $150
    = 6,667 gold.
     
  5. Kara Brae

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    This was a question I asked at the R51 Telethon. Reply:
    Kara Brae: Currently you can use COTOS to add tax credit in the Lot Deed interface and each COTO gives you 3,500 g credit. Now that COTOS are more expensive and the market price for COTOS is surpassing 4,000 g will you be adjusting the value of COTOS for the purpose of paying lot taxes?
    CHRIS: Probably not but I won’t say never. This is actually working how we want it and players who choose to use COTOs to pay rent can now either use the simple option and just pay with COTOs or they can sell the COTOs to other players and pocket a bit of extra gold. Up to players and the free markets!
     
  6. Adrian (Kung Fu Master)

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    It's a disconnection between the programmers and the sales/marketing department.
     
  7. Xandra7

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    RMT (player sales) gold values should be taken out of the equation, has absolutely nothing to do with playing the game. Or should have nothing to do with in game economy.
     
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  8. Solstar

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    Players can charge whatever (absurd) price they want for stuff, including gold. The only control devs have on that is by affecting drop rates and real world value of COTOs.

    If they messed around with the COTO value based on the player market, that would be a full time position, and a horrible waste of a Human beings time.

    The moment the devs increase the gold value of COTO related to taxes, as per your suggestion of 5,800 gold, that will inevitably change the player market exchange rate.

    I'm not sure why you think the player market exchange rate isn't variable... Just because a few people charge 6,667 gold per $1, doesn't mean it's suddenly some standardized value.

    If the exchange rate was a couple standard deviations higher or lower, then it might warrant a closer look.
     
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  9. FrostII

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    This ^^^^ :rolleyes:
     
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  10. Tirello

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    Wouldn't the system of eventually balance itself out?
    If COTO end up being worth over 6000 more people will end up buying them from the store and drive the price down.
     
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  11. Adrian (Kung Fu Master)

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    It's foolish to exclude the players RMT out of the balancing economy equation because most Players' vendors/merchants are based on this exchange rate of 6,667 gold per $1 to price their items. Again, the market and economy theories are very subjective on the individual's opinion, but one can not ignore the facts.
     
  12. Adrian (Kung Fu Master)

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    It won't go above the 6,000 mark because, as you said, people will buy from the store if the price go above 5,800. Eventually, they will balance themselves out, but in the means time, people will buy gold with real money, and then purchase COTO with in game gold to get the most bang for their buck.
    $100 = 666,700 gold / 4,500 gold = 148 COTO vs 115 COTO for $100. Again, why wouldn't anyone wants to earn the extra 33 COTO?
     
    Last edited: Apr 15, 2018
  13. Tirello

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    If no one is buying COTO from the online store for the fear of losing out on the 33 COTO. Where are they going to be buying them from?

    The price will equalize at some point. They might not be a viable use for house taxes but does that really matter.

    Another drawback is obsidian merchants goods will cost more. That seems like a normal function of a player run economy to me.
     
  14. Adrian (Kung Fu Master)

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    To name a few, there are players' vendors that sell COTOs in Crossroad, Novia Market, New Brittany Market, Owl's Head.
     
  15. Tirello

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    So people will still be buying them from the online store to fill their shops?

    I'm confused I thought they would all be buying gold to finance the need for COTO.

    Oh wait we have a dynamic market. Tomorrow a COTO from the store could be worth 7000g. Completely negating today's price of 6667g and making it a better deal to buy them online.
     
  16. Lazlo

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    There are pretty much always inconsistencies in the market values of different things. Like other have already said, those values aren't set in stone, so it's really not a big deal.

    On a related note, does anyone remember when the new crown vendors went in and everyone thought that 3000g COTOs were artificially inflated and unsustainable?
     
  17. CatweazleX

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    How did COTOs come in game? Drop rates are low.
    So, someone needs to buy the COTOs from Portalium to put them on the vendor...
     
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  18. Adrian (Kung Fu Master)

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    They come with items/bundles Players purchased from the online store. They also increased the drop rate in game, but it's not enough to do any damages to the supply curve to lower the price.
     
  19. Thwip

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    Ah yes, I see what you are saying, but also consider:

    Currently I could buy COTO during the Telethon and get rewards, turn around and sell the COTO on my vendor for 4500 gold each, then pay my property taxes and pocket the excess.

    Aside from the rewards, would I be ahead buying gold, or buying COTO and selling for gold?
     
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  20. Thwip

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    Ok, re-read the OP, yes better off buying gold off of the marketplace. Interesting post. ;)
     
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