Why is STEEM worth more than 5$ on Bithumb?
I've seen the same old situation play out so many times now and it's getting boring. Deposits and withdrawals of Steem on Bithumb are blocked, all while the price is skyrocketing (currently 5,15$). This has bothered me for the longest time and I even asked about it through a post on Steemit a couple months back but, no one seemed to know what is really going on other than the obvious, that the price is being manipulated.
So, for my first time using Musing.io I would like to ask you the following questions:
How is it possible that on one exchange Steem is worth 7x more than anywhere else?
Who is responsible for the massive price increases on Bithumb?
Why are they doing it?
How is it affecting the overall price of Steem?
I'm looking forward to getting your opinions and finally getting to the bottom of this!
Oh, yeah, and tell me please if I'm doing this wrong. Maybe I shouldn't ask more than one question or I'm using the wrong format. If so please notify me about it.
Your question is detailed and needs a complete answer. I believe that I can answer a part of the reason why Steem prices are trading at 7x times the market price.
The thing is that at the moment Bithumb has 85 percent of the trading volume of steem but at the same time you cannot deposit or withdraw Steem from Bithumb.
This has lead to a complicated situation, where speculators are taking advantage of the situation. This means that with high volume of tokens are being traded at place where the supply is low (due to wallet lock down). This has resulted in jacked up prices and higher price volatility. The speculators are feeding this volatility make day trading gains, which in turn is pumping the price.
Bithumb probably uses some asian-only markets to tell steem's price.
It's just wrong.
My answer could not answer your specific questions, however I will express my opinion.
In a decentralized system I believe that this is possible to happen, manipulation of supply and demand to affect prices for specific purposes. I do not think it affects the value of steem globally. I do not look with good eyes either. Transparency should be the premise to follow.
I think that with SMT steem it will be able to rise again and stay.