Why the Steem Price is Falling
It is nothing to do with whales, it is about speculators.
The Steem price is following the same pattern of other cryptocurrencies.
What usually happens is that there is some big news, the speculators pile in, but to sustain the price there needs to be a constant stream of news of developments in the coin. If there is no news the speculators bail.
Lets look at bitcoin
The first development that caused the spike in the price in 2011 was the dark nets accepting it for buying pot. It suddenly had a unique use that fiat didn't have. Money poured in, some of it people buying to purchase pot, the rest of it speculators buying in anticipation of other real users buying. Then the gambling sites started accepting bitcoin, causing a second spike in 2012/3. This is because visa and mastercard blocked users in the USA from using their cards for online gambling - so if you were american and wanted to gamble online, bitcoin was the only option. So another unique use. Then the Cyprus thing happened, and bitcoin was a way of storing money where it couldn't be confiscated - another unique use. Then mainstream retailers started to accept it in 2014, but this wasn't that much of a game changer because you can use credit and debit cards to buy stuff already, and the bitcoin price has stalled since then, because no new developments and no new uses have come forward.
Now look at Steem.
There was a spike in July once the payments started because it proved that here was a way to monetise writing, art and photography without tipping from your own wallet. So a unique concept, because steem does something you can't do either with fiat or bitcoin. But since then there has been no big news, just small developments shared only within the steemit community. Peerhub got launched, but without much publicity, and we have no stats on how many people are using it. Wallets like Bitwala started accepting steem but say that no-one is using it. Coinpayments.net have added steem and steem dollars - but we have no data about whether people are using it, and hence no news to pique the interest of the speculators.
Meanwhile the speculator community watch stats like the number of users logged into steemit in the last 24 hours to give them an idea of the size of the community. Here is a screenshot of where we stand today:
Only 3781 accounts logged in. Kinda pitiful really. The active community matters because speculators reason correctly that the bigger the community the more commercial activity will be taking place and hence the greater demand for the currency. If less than 4000 people are logged in, then how many of them will be buying stuff using coinpayments, or sending money using bitwala, or purchasing stuff on peerhub? Not many.
Of course it is a chicken and egg thing - the lower the price falls, the fewer people log in, which causes the speculators to abandon the coin some more, which causes fewer still people to log in.
What we need is some sort of news
Not news about minor technical developments or tweaks to the steemit interface, but some big "unique use" news. Perhaps a marketplace where people can sell their services. Perhaps getting on a big exchange like Kraken or Coinbase. Or perhaps news that one of our competitors (synero or yours) has failed, which should send the speculators rushing back to steem. Or even stats released by peerhub showing the amount of activity taking place there. Any type of news will do!
It is the New Age Y2K Modern World so everyone has an opinion, including me ; please understand 3 months ago I could not spell BITCOIN so I am no expert.
If you have ten whales will a million steem power they all have huge voting power. Plus a lot of money tied up in a prototype platform called steemit. Why would they not power down and turn unknown Steem into " real " BTC ?
If whales are selling someone must be buying? why would traders even be buying lots now while the downtrend has been so prolonged. So it must be Steemians and not traders who are buying Steem.
This means mega whales become only huge whales and some minnows become dolphins and new whales are made out of dolphins. But overall the power of steem power is evened out ever the platform. Every day there is a tiny re-balancing when some minnows like me get a slightly more powerful voting voice.
Thus instead of having just ten mega whales now you have hundreds of people who are financially invested in making steemit work. Instead of ten huge voters now you have hundreds of people sharing the love around with voting power.
Over time it will no longer be essential for a post to succeed by catching a whale. People will feel loved and respected. Anyways just my opinion and what would I know ! ! !
LOL :)
See you on the BlockChain ; )
There are always marketmakers on the exchanges who buy to facilitate trade. If you look at the poloniex wallet, they hold a huge amount of steem, which means they are acting as market makers rather than speculators (if speculators were buying, the steem would be in their account). See
https://steemit.com/@poloniex/transfers
You are correct that minnows and dolphins are accumulating steem and steempower - but this is from newly generated steem. I think about 800 steem are generated a minute, and of course voting distributes that new steem. The redistribution isn't enough to sustain the price, because you need new buyers to absorb the steem already generated - that is why we need speculators. All currencies depend on speculators even fiat!
On the bitcoin subreddit, I have noticed lots of advertising at the top from bitcoin suppliers - I wonder if we can interest them in purchasing steempower and then using a bot to upvote any post that has their keyword in it?
After all mainstream advertising works on keywords, so steem up-voting could work the same way. For example say shapeshift bought steempower and then upvoted any post that had "shapeshift" in the text. I think that could create a certain buzz in the cryptocoin community.
This was a question that to me every day, thanks for your reply, excellent post
Steemit is whatever we want to make it. Recently I posted two excellent robotic vacuum cleaners for sale. Simply they are in perfect working order and thus I posted about them herein.
Currently I am running a guessing game as a bonding exercise with a 101 % payout to bond the Steemit community.
https://steemit.com/guess/@crok/simple-your-guessing-game-with-101-percent-sbd-payout-guaranteed-it-is-so-simple-it-actually-becomes-hard
But we must start to find other new and novel ways to showcase our platform, in particular try and find a new steemian and mentor them ! ! !
excellent research....
Into my steem voter ya go!