Most of the money in cryptocurrency is speculation. Average people who have more than 25% of their assets in crypto are definitely not investors.
For Hive, hoping the value will increase is purely speculative. With inflation, about 10%, and most of that going to authors, developers and witnesses, just holding HP for Curation rewards at the current value of Hive is a little underwhelming given the volatility of cryptocurrency.
2HP curation /1000 a week (kinda easy to get) is around 104/1000 a year so combined with the inflation rewards for just having HP, it's easy to stay on top, but what are we looking at like 2% more than inflation? It's not a particularly good investment. You could sell your Hive and stick it in a better investment.
Blogging is or author rewards do involve developing writing skills, and if you take photos or make videos, editing skills, too. I consider this self-employed income, not investing. It's harder to value this, but I think to a certain point it's an investment. Some people may even be improving their English which is huge value for non-native English speakers. It's this aspect in particular that draws me to Hive.
That said, I'm in for the speculative nature most, but this is more for other cryptocurrencies and not Hive specifically. Speculating on cryptocurrency, in general, is high risk, going all in on one particular cryptocurrency (especially one that isn't solidly in the top 10) is madness.
Actually, it's pretty easy to achieve 10 percent APR on curation alone. I know people who get 15 to 16 percent APR just by curating.
Between March 2017 and December 2017, Bitcoin went up 20x. Do you know the factor by which STEEM went up between March 10 2017 and January 3 2018?
Hint: large cap coins like Bitcoin and Ethereum are NOT where the largest gains were made and I believe will not be made in the current cycle, either.
I also make more than 10% but its not so easy. Also the problem is the risk factor. There are safer ways to make 10%.
The problem with investing in midcap and low cap cryptos is they have a tendency to die. There will always be spectacular hits, but the amount of ones that die off are starrgering.
I think the lowest Steem price was cents, Hive and steem are now a whopping 35 cents combined for a gain of 7x.
Do I have to comapre it to BTC when it was worth fractions of a penny or ethereium when it was worth about 1$? Being selective will always product selective results.
You do have a point about potential. There is only so much more doubling btc or eth can do given the marketcap size.
About 30% of the inflation goes to curation, so I think it is a fair portion, considering it doesn't take much work other than consuming.
Using current skills or building new skills is a huge value here. Most people take photos yet have very little purpose for them, let alone return on the time spent. Here there is the chance for something.
THis is what is interesting about Hive - it can actually be a gateway into crypto for many. Most people are going to struggle to pull any trigger having to do the initial work to invest straight into crypto - Hive can be a bridge.
Part of Hive's appeal is that it is more than just a speculative asset.
I also think curation + inflation rewards are fine. The operating expense of hive is cheap compared to some blockchains, but calling it free (as some people do) is misleading. We all pay for it in the form of inflation.
The bridge aspect is an interesting point. I wonder though if it does more harm than good especially for investing? People mine Hive first then sell for others.
Actually, I am not sure if you consider that many people haven't bought any - meaning that everything they have earned is on the platform - so the inflation isn't a cost, it is part of the system they opted into. Possibly wrong,, or semantics :D
This has happened since the start.
Interesting chart from @dalz
Look at all those powerdowns early on the chain (2016) - that is all the ninja mine as so little had come out of the rewards pool at that time.
But If you have 1000$, Hive may not be the best crypto to invest it in, especially if you already have a somewhat decent account and can just eventually get it for free from blogging (something I should get back into ;).
I actually let Hive creep up to a huge % of my crypto portfolio just before the Steem thing. It's back down to a more manageable amount. I sold a ton of crypto in March that I acquired in 2019 when the prices were low to take advantage of the dip in the world stock markets (no regrets) and used my Hive/Steem to slowly get it back due to the 13 weeks powerdown.
Looking at that graph is neat, I like the little PD ticks every year when people are selling to realize their losses for taxes or whatever. But it really gets confusing in early 2020.
I think the only way to consider it fairly is to start counting Hive around July 2020 when people were finished powering down Steem.
It really complicated the analysis situation. I don't consider people who sold their Steem to buy Hive as outside investors, but it's hard to consider it as a continuation.
!ENGAGE 20
ENGAGEtokens.