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RE: STEEM Is NOT Steemit. STEEM Is More Valuable Than Steemit.

in #steem4 years ago (edited)

I think we are both saying the same thing from a different starting point.

Let me establish that by asking, how do we get to that massive market cap? If we look at how the dollar got there, it was through the projects that the US Government initiated to create a need (such as the bretton woods system).

For that market cap to exist, there needs to be products and services that people speculate will succeed. Involuntary injection of money into the blockchain will only yield with people taking advantage of free money, because that is essentially what STEEM does. It creates a rewards pool, and how that rewards pool is dished out, is really up to the stake holders.

In the interest of self preservation, people will often reward themselves before they reward others. So to change that, we will need to create incentives for them to use the coins in different ways. That can only come with establishing products and services based on the coin.

That's the path to a large market cap. Otherwise, how can we get there?

When I mean "extract" I mean if person A injects $X and powers up on the STEEM network. because of supply and demand, the price of steem might go up in that process. But how do we maintain, consistently that value?

One answer is to have such a high valuation of steem, that $X has no real effect. But before we get there, people will constantly try to cash out their portion. The solution to this is again the large market cap. My concern is how we get there.

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Getting a high market cap is very simple: price per coin * number of coins = market cap. You either have to increase the price per coin or the number of coints or both. We already have the number of coins increasing and there are no plans to change that any time soon that I'm aware of. Price per coin only happens when more people buy the coin than want to sell it. That's all I was saying.

We could discuss various strategies and reasons for why someone would want to buy STEEM. I think you're argument has something to do with there being more of a marketplace to use STEEM as a currency. I like that perspective and hope it to be true, but Ned said something at Steemfest which stuck with me concerning currencies and stable marketplaces. If the price of the currency fluctuates too much, people won't use it to buy things and merchants won't want to sell their products for it either. It may be a chicken and egg problem, but ultimately the replacement of the fiat system with a cryptocurrency system is the number one way to increase the market cap as more people exchange their fiat for cryptocurrency.

And don't even get me started about the Bretton Woods agreement. From my perspective, the United States basically screwed over the world by taking all their gold.

This is deviating a bit from the initial post topic but I felt inclined to jump in...

How does one buy Steem? and/or acquire it? Are there other uses for, or platforms using #Steem, besides #Steemit?

(excuse any novice or redundant questions/comments)

The high value of Bitcoin is due to it being -obviously- a base coin if not the base coin, and because it is a means for people to buy/trade/invest in other cryptocurrency/coin. Which is aside from it's ideological value and its (relative) efficiency as a cryptocurrency. This is what makes BTC a power player more than it's efficiency as a blockchain or currency.

From my rather basic understanding of the #Steem blockchain and it's capabilities (based on the few posts I've read so far and previous convos with @motoengineer) it appears to be far #superior to those of the top base-coins and most other coins.

However, no one knows about it. Or how good it is. Or how to get it. And to be frank I wouldn't imagine the majority of people who would potentially use (buy/trade/invest/purchase with) it, even care about anything more than the face value of it and how they can use it for their own personal benefit.

This brings me back to my initial (semi-rhetorical) questions up top...
Getting the word out there on what Steem is, where it can be used and how to acquire it, is cyclical (like someone may have mentioned above) almost chicken and egg like. So while the value of Steem is in its mechanics, it cannot function at the moment without Steemit or a similar platform to help it get exposure and continue to rise.

Price per coin only happens when more people buy the coin than want to sell it. That's all I was saying.

Agreed, but thats not worth discussing because getting the people to inject that capital is the main problem.

If the price of the currency fluctuates too much, people won't use it to buy things and merchants won't want to sell their products for it either.

This is 100% true, but I the only way I see it reaching a stability point is if people stop wildly speculating on steem and start producing services so that there is a real need for steem. If the need exists and a solution/product is there to satisfy that need, you've created a circulating force for steem, that circulation is what keeps prices steady since no one is trying to cash out of steem.

As for replacing a whole countries currency with a digital one, thats a tall order. It is, like you said, a chicken and egg problem.

No one will replace their existing currency with a digital one, if it cannot maintain stability. But stability cant be maintained if no one keeps their money in the system (hence why powering up was invented).

We will get there, but we need to have ideas that push us there.