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RE: Is this why the price of STEEM is struggling? STEEM Withdrawls 2017
I think that people withdrawing Steem is a good thing, it's being used, and in order for it to succeed it has to be. I don't think the price of Steem is struggling. We are right on the cusp of having some awesome updates to the official front end, all sorts of awesome develpment on 3rd party apps, we're just young as a token, and as a community. It's not really fair to compare Steem to btc, when btc has been around for a lot longer. Since btc is transferrable into any currency, digital or fiat, it's king. Untill another currency can do the same, there's no point to being upset about it.
Steem is about 10x where it was this time last year... I don't think our price is struggling as much as we're just breaking out of our cocoon.
If the steem network is being used to transfer money, then it is serving one of its functions as means of transferring money (sbd in this case).
What Paula is saying is that powering down (whose only intent is to ultimately trade that steem out for other coins) will end up flooding the exchanges who provide liquidity, with more steem. If there are not enough buyers and too much steem sitting on exchanges, the value will go down if their steem grows faster than user demand looking to enter the steem.
At the same time steem is developing and growing trying to increase value. This can only be done of steem isn't being dumped into the market.
I like the article, but I think it kind of misses the point. Steem's main strengths are propagation and ease of entry. The price doesn't really matter this early.
@inquiringtimes is right in pointing out that BTC has been out far longer, and this creates the illusion that it's doing better than Steem. It isn't. Steem has far more potential at the end of it's first decade than BTC is showing at the end of it's first.
Also keep in mind that Steem is inherently inflationary to a fairly large degree, so can't be meaningfully compared to an exclusive, deflationary cryptocurrency like bitcoin. The fact that Steem is mostly holding its value despite the fact that more is created every day says something extremely positive about the currency's direction.
If you were here a year ago then you remember that at one point (for several months, maybe more) Steem was dropping like a stone in water. Now we've reached our first stabilization and, even if a significant portion of the first whales leave, I have full confidence that Steem will recover long term. It's built to do so.
The markets just don't matter as much with Steem as they do with BTC because Steem is aimed at being a social cryptocurrency with wide propogation. When enough people are using it, investors will come knocking in droves.
Exactly. This is a long term game. I'm not worried about the price of Steem at all. This long exhalation was always going to happen. Once the whales cash out, and that Steem gets bought up by many more users, they will be much more likely to hold on to their smaller SP balances. This is a natural cycle in all crypto. Long fractals. It just means that when the price spike does come, it will be extremely fast and violent.
This is a long term game, and steem does need to change hands and the power be distributed among a wider base
Lets add in this point, if the price of steem goes up, so does the vote value. New people coming to steemit have been seeing 0 on their vote given. This is not very motivational.
I do think the problem here is people's lack of willingness to invest in Steem rather than any problem with the system. At the moment anybody can put $50 into Steem, that's literally pocket change, and as the statistics stand, that already puts them into a higher bracket of users than the majority, who have nothing. With just 50 SP you can see your voting power have a real effect, especially if fully utilised daily and the rewards powered up. But most people don't do that. Even if the Steem price goes up the proportions won't change. It will still take the same amount of money to buy a proportional level of voting power.
Thank you for your detailed analysis though, it's very interesting and much appreciated!
$50 is not pocket change to many many users here. It really depends on where you are from.
Yes, indeed! $50 can represent a big chunk of cash!
Spot on. The ease of entry is so incredibly important. When you register Steemit sets the user's wallet up and they are good to go. That is HUGE. Try using LBRY. It's a pain in the ass for the non technical user.
STEEM has been incredibly stable compared to most alts for the past 8 months, it hasn't gone up a lot, hasn't gone down a lot in terms of USD. BTC is a different story.
What I love about Steemit, aside from the blogging and community, is the ability to get my rewards 50/50. Then I can invest at least half back into the platform and take the other half to do with as I please. This was another genius move.
Steemit is ahead of it's time regarding crypto social media and we are all early adopters so HODL.
Yep, total agreement. You're right: the 50/50 system is a spark of real genius, though maybe a subtle one that many people don't fully appreciate.
I have a tongue and cheek way if describing this: 'hunger proof'. Take the SBD to supplement your income and know that the rest is out of your reach unless you're willing to wait a significant amount of time for it.
Even if some immediate concern is up (bill is due, budgetary mishaps, or even an extreme case where you were literally starving (hungry) and your judgment was at its most altered), you aren't tempted to power down.
It's better than savings, and people are going to realize this.
While i think the ease of entry is something that steem shines on. I dont think it has a much of a primary effect right now, as it will later in the game. Think of it this way, if there was an EXE file that you could run and mine btc back in 2009, why didnt anyone do it since ease of entry was that great?
This is a rehtorical question, because back then BTC didnt matter. Just like right now, ease of entry doesnt really matter.
What does matter right now is a library of content. The better the content, the more likely the result will show up on google searches, and once a steemit article becomes atleast 1 in say every 10 searches a user performs, thats when ease of entry will become important. Right now, not so much.
Your explanation is very interesting @jenkinrocket. I am very interested.