Solving Steem Liquidity Issues
We have super tight internal market with a spread about 15% with Bittrex. That is huge. There are not enough demand there.
Illustration: kidsnowcanada.org
Why that happens and How to solve it?
The first reason is that there are no publications in major media yet. Even about $1 million dollar payouts. One of possible causes is 15% spread between Steem Dollar and USD dollar. This fact reduce credibility.
The second problem is available supply. Now 99% of available Steems are locked. It is good because everybody believe in a thing. But due to this trade itself is also limited and as a result trade volumes appears low at first glance. That stops everybody from big deals. Looks like traditional chicken and egg problem:
We don't have liquid market because we don't have enough available supply because current price is too low because we don't have enough media coverage because we don't have liquid market.
Do you understand? We need both a more liquid supply and media coverage. The easiest way to do it is Poloniex listing. I don't like pump based publications generally but this time I do believe that's credible. I have not seen blockchain projects with such retention as Steem ever before. Of course we can cleanup sell orders on Bittrex for tiny 30-50 bitcoins but that would not solve an issue longterm and moreover removing such necessary supply from a turnover makes situation even more worse.
This picture is a kind of proof that the only way to pull out 2-3% of supply to the market and make it happy - if price increases tenfold.
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If a price will raise tenfold and there will be enough liquidity we will have needed 3-4% of supply in 2-3 weeks after power downs. And the only way to get this is to put our stocks into Poloniex!
Call to Action: Submit your request to Poloniex
Unfortunately I do not have any connections to Poloniex executives. But I am sure that many of us have trusted accounts there. Just go straight here and ask this guys to add Steem. The more people submit that the more chances that Steem will get listed.
Make even more buzz in trollbox. Its already full of Steem. Make it even more buzzier!
Make Authors Happy
Liquid Steem is the only way to make authors happy. As result we will have necessary media coverage to close userbase feedback loop and start growth our community organically.
Disclaimer: I do not neither consider myself as a traded nor want to be involved in any speculations. But I want help push awesome blockchain projects! I am writing this because I do believe that this Steems chicken and egg problem is the only barrier for explosive organic growth of Steem.
Steem on Poloniex would be great. Many people there!
I just submitted my request to have them list it.
Another problem I see is that it is not immediately clear why somebody should buy Steem, aside from speculation. I think it would be helpful to emphasize the fact that, beyond participation in the community through posting, commenting, and voting, Steem Power and Steem Dollars earn a return on their balance that exceeds any bank account you'll find and outperforms Proof of Stake coins as well.
The point is that our problem has to be solved only by speculators who will flood Steem with liquidity. If we will only have guys who want to buy Steem only to convert it to Steem Power we will have even more problems with liquidity.
I would expect people buying it without the intention of selling right away would have the best impact on the price, stability, and long term viability. The influx of liquidity caused by speculation would only benefit the market in the short term, as speculators trying to take profits add to pressure put on the price by bloggers trying to get paid for their work. It would help to inject some liquidity, but I don't think it's a long term solution.
You are right. But the truth is that in our case that is a problem. The problem is that authors cannot get Steem Dollars on hands in bitcoins because of crazy spreads between Steem Dollars and Steem. Do you understand this?
I understand that aspect of it, yeah. I just think it's going to be a persistent problem that is going to require investment in the platform as opposed to simply speculation on the price.
Submitted a request to Poloniex
Arbitrage bots are very profitable right now. They will make bittrex and steemit spead smaller and smaller over time. I wish i was a trader right now.
You cannot solve this issue using arbitrage bot as this bot also will suffer from liquidity issues :-)
I also submitted the request to poloniex!
I just submitted on poloniex, we'll get steem over there before we're done!
Bitshares never got much media attention either. There must be something wrong with the way marketing is being done in this community. Has Coindesk even covered Steem?
Thank you!
very good idea!
That's the first time I ever hear "market liquidity" and "media coverage" used in the same sentence, let alone with a causal relationship. In my world media thrive on hype, not on market technicalities. Also, itsn't it contradictory to say that lack of STEEM liquidity is the cause of the lack of volume, and at the same discuss about wiping the sell book orders on Bitrex? Aren't these sell orders STEEM liquidity?