If Steemit Inc. goes bankrupt by then do we have to pay its commitment from the money in our wallet?
Steem is an utility token while steemdollar is a payment token. They are not shares in a company so you have no commitment as a shareholder.
If steemit goes bankrupt that would probably crash the price of steem and steemdollar because it would create a lot of uncertainty in the market. That's never good for the price. Also steemit holds a lot of steem so a curator would probably need to sell it on the market when they go bankrupt. That's not something that will do the price any good, more like the opposite.
I don't think steemit will go bankrupt for now. The management of steemit made some serious mistakes , they wrongly speculated that the price wouldn't drop this much. So now they have not enough funding anymore to pay all their employees. That's why recently 70% of steemit employees where fired. They now need to focus on surviving this bear market until we start the next bull market. Things will be a lot better because the higher the price of steem the more funding there is.
However, in the long term there are some serious issues. The business model from steem is broken. Rewards on this platform are paid by printing more steem. So they are basically diluting all people that own steem which creates a downward pressure on the price. The only reason the price has gone up so much is because new users are bringing in fresh money to this platform. When the growth of users will stagnate the price needs to go down. It's a simple case of demand and supply. The greater the supply of steem on the same demand, the lower the price will be.
What steemit really needs to do is find a way to make profit and pay the user rewards from the profit they make. Right now they are only diluting all the owners of steem to pay out rewards. What's the point of that? I don't get it at all. It's like you would pay someone with their own money. But most people don't realise this because they don't know enough of finance or a lack of doing research how the steem blockchain works.
Price of Steem is based on Supply Demand and market maker. Unless Steemit inc goes bankrupt, the price of Steem reflects on all factors mentioned above. Supply Demand are the most important factors. People buy Steem to promote their content, power up, earn passive income, etc. it has nothing to do with the Steem inc.
As your suggestion of paying people rewards by the profit of the company, it is wrong, unless you own the company shares. On Steem platform, we are just users of the platform, not shareholder or any kind.
Just my thoughts.
On the short term it's all just price speculation. Crypto currency prices are very much based on sentiment. Everything is correlated, steem prices follows the bitcoin price. When a new bull market starts i see steem price increase in value.
But on the long term eventually fundamentals will matter. Steem is designed to decline in value. Right now it's not an issue since blockchain is becoming more popular so enough new capital is entering. At a certain point growth will stagnate while the supply of steem keeps increasing. I don't see how this can be a good thing. In fact it's kind of the same what central banks over the world are doing with their quantitative easing. They increase the supply by printing more money which is inflationary. You can't have deflation when the supply keeps increasing, steem is also inflationary. It's just some basic economics.
I agree about the fundamentals of Steem and the endless prinitng may affect the price and value.
Thats true for many economies, including the US. As they State inflation annually, the amount of money is expected to increases, but it boosts economics and also give more room to grow. I used to hate inflation until I learned that managed inflation could be good for the economy. Back to Steem, if there is no new Steem to be created and we keep the current supply and circulation, how likely that you will actively work on Steem?
For me, if we stop that award scheme, chances that I will switch back to trading instead of holding and creating more content.
Great discussion. This is also one thing I love about Steem: lots of insightful people to talk and engage to.
@attoan.cmt
When they would stop the scheme there would be no steem to pay to users so i wouldn't post as much. So it's true that there wouldn't be that much content created.
But i think that this whole business model is broken since the moment they thought this idea out. The problem is who is paying? There is no such thing as a free lunch. There is always someone paying unless you print the money yourself thus increasing the supply.
All businesses need to make money and someone pays the bill for it. I don't know any exception to this rule.
This whole idea gives me a bit of a socialism/communism taste.
It true that many economies also print money but i think it's a different situation. They play with the money supply to influence the economy. In theory it's a great scheme. You stimulate the economy in bad times and you make the good time a bit less spectacular. But it's not something that's intended to make money with. The economy itself makes money, they play with the money supply to make the economy less volatile. In case of steem it's just giving other people's money away = socialism.
@marketmaven1
I know a solution that many people won't like but i think it's not that bad after all. When there are ads shown on this platform that would definitely generate a lot of income since this website is ranked in the top 100,000 most popular websites in the world. And most posts are about finance which generates more ad revenue. They can pay the users with the income from the ads. I know it's sometimes annoying to see ads online but the users would make money themselves since the inflation will be less. Or maybe do some kind of hybrid model where they print steem and show ads to pay the user rewards.
Normally the promoted posts should earn money but the problem is almost nobody is using that feature since it's more lucrative to use upvote bots. When you promote your post you lose the money you spend on the promotion. With upvote bots you earn the upvote - curating rewards and money spend on upvoting service. So you can break-even or even make money when using upvote bots.
What is the point of earning steem when they pay you by increasing the supply? The inflation will be as much like the total payouts of rewards. Which makes it a zero sum game. It's like someone would pay you with your own money by making it worth less.