Or "deflationary currency" versus "inflationary currency".

Call it what you want, but there is this fundamental dichotomy resulting in two different (and opposite) ways of perceiving something as being valuable.

One is:

"the less we have of it, the more valuable it is”,

and the other one is

“we had so much of it, that we don’t even bother to measure it, unless we’re left without, in which case we die”.

These tow filters are applying not only to currencies, as a store of value, but to everything else that we consider valuable.

Our health, for instance. When we have it, we don’t even notice it, because we expect it to be like this, continuous, with no gaps. In financial terms, we have an unlimited inflation of health. But when the "health inflation" goes below a certain threshold, we brutally notice it and start to work at it. This is an example of "oxygen money".

Moving on to land. That thing we use to build our houses on it. Now that we know there's a limited amount of it, because the Earth, as a planet, is a finite object, we tend to put more value on it. For instance, in Monte Carlo, a country roughly 4 square kilometers, the average price of an apartment is $2.5 million. This is an example of "scarcity creates demand".

Bitcoin versus Steem

I just wrote a few hours ago a post debunking the hyperinflationary nature of STEEM, so feel free to read it if you're curious about the numbers. If you're too lazy, here's the core of it: STEEM inflation is not as bad is it is perceived. In 20 years, it will go as low as 0.5% per year.

But yes, even in this situation, STEEM is still continuing to print money, indefinitely. It's an "oxygen money" type of currency.

On the other side, Bitcoin will cease minting money in a few years. It's a "scarcity created demand" type of currency.

So, Which One Is Better?

The "scarcity creates demand" model, or the "oxygen money" model?

With all due respect, I think this is the wrong question.

The right question will be: "do we really need to have either Bitcoin or STEEM? Or they can both coexist in the same time space continuum?"

My answer to this is: "yes". They can, and they should probably strive to coexist in the same areal.

Because they solve two different types of problems.

Bitcoin is an agnostic type of currency, minted with an ancillary algorithm, something that was initially used to prove the validity of the concept. The mere fact that Bitcoin still survives it's somehow proof that its existence is validated.

I know it sounds convoluted, but try to think about it. If we really, really look at it with a clear eye, Bitcoin doesn't really solve a problem. At least, it doesn't solve a problem anymore: it's slow, fees are high, it's been hijacked lately by centralized organizations and so on.

But neither does gold.

And yet, we, humans, somehow agreed that we will use this etalon: gold will be the measure of wealth. It could have been silver, you know. But it's gold.

Following the same line of reasoning, Bitcoin is not valuable per se, as it is valuable as a pervasive, ubiquitous agreement. Everybody agrees that the underlying technology behind Bitcoin is better than the centralized model of banks + governments.

So, we want it to stay like that.

But STEEM, on the other hand, doesn't need this type of validation. STEEM is already a child of this technology.

The difference is that "it starts its existence the moment we start writing". As long as we keep writing, commenting and voting, STEEM will be there to measure our impact.

It may not be a perfect measure. It may be tainted by early whales and imperfect DPoS algorithms, but still, it's there to witness our life depiction with words.

From this point of view, STEEM is like oxygen. It will be there for as long as we keep talking and it doesn't need to have a limited supply. If it's limited, it means we will not be able to speak anymore. Or to breathe.

So it's not "which one is better".

It's "how can we mix them together".

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I'm a serial entrepreneur, blogger and ultrarunner. You can find me mainly on my blog at Dragos Roua where I write about productivity, business, relationships and running. Here on Steemit you may stay updated by following me @dragosroua.

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You can also vote for me as witness here:
https://steemit.com/~witnesses

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If you're new to Steemit, you may find these articles relevant (that's also part of my witness activity to support new members of the platform):

• Rewards: Were Does The Money Come From?
• Netiquette: How To Avoid Being A Steem Douche?
• Witnesses: What Are They And Why Should You Care?
• How Can I Mine Steem And What CPU / GPU Power Do I Need For That?
• The Beginner Guide To Not Getting Hacked On Steemit