Where does cryptocurrency come from
and why does it have any value at all ???
The crypto-craze started with the bitcoin, a wild idea by a man who went by the pseudonym Satoshi Nakamoto. Bitcoin was to be a secure, anonymous, and fast payment method for transacting any number of exchanges around the globe using decentralized validation systems that were difficult for governments to restrict or control. The primary value of bitcoin was in it's ability to perform "secret" transactions while still verifying those transactions securely. The secondary value is in its scarcity.
What is "Scarcity" and how does it affect value?
Scarcity means there is a limited supply of a given asset. Most currency is scarcity based. At one point in time all US currency was backed by gold, now that same money says "In God We Trust", I like to joke that the emblazon means the only value this instrument has is the faith that it will get you something.
Why do values rise and fall
Values rise and fall because of the agreed upon value of the make believe money. Because there is no "real" asset backing the money, it's completely imaginary and its only value is the value agreed upon by its holders.
but I didn't agree that I should lose $400 on my investment ... what gives?
Actually, you did agree. By choosing when you buy sell or transact with any currency you participate in setting the price of that currency. When you exchange it for another item of value the value of the currency is automatically compared with the value of other currencies that can be used in that exchange.
What makes Steem and Ethereum different?
Steem and Ethereum are a different kind of token because the agreed upon value is based in a "property". The value of these tokens is derived from the agreed upon value of a community or a contract, respectively. As an investment instrument, this means that these tokens have a "real" value rather than the imaginary value other tokens are based on.
Why do Steem and Ethereum still follow bitcoin?
Because bitcoin is what market makers know. Market makers rely on information from known sources to set their ideal price, since they know bitcoin they follow it more closely and compare all other cryptocurrency to bitcoin.
How can Steem become more valuable?
Through a grassroots effort to make it that way. Instead of cashing out Steem or SBD at what the market offers, collectively asking for a higher "price" on the token creates a more valuable token. Holding Steem or reinvesting into Steem power can also help to increase its value.
*Disclaimer: I am not an investment professional. All investments bear risk, cryptocurrency is VOLATILE and especially HIGH RISK. Never invest more than you are comfortable losing 100% of. Nothing in this article is intended as investment advice. Invest AT YOUR OWN RISK."
i have proposed your post to curie programme; thanks for the help in my post
hope that the proposal in the curie gonna be appreoved so you gett hight payout
thank you again
Thank you very much! I wish you great success as a Steemit author :)
Because human psychology is a major factor, and for most people, movements in one crypto will affect their perception of all the others.
The stock market works this way too - share prices of different companies tend to move up and down in unison, even when those companies have little or even nothing to do with each other.
This is also a very valid point and expands on my theory that it's what market makers know. Thank you.
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