Where Does STEEM's Value Come From?

Many people may be wondering, what gives a Cryptocurrency Value? What makes Bitcoin over $600? What makes STEEM over $3?

Tha Value of a CryptoCurrency comes from 3 main things. 

1. Community Involvement

2. Trade Volume

3. Open Markets

4. News Coverage

STEEM has only experienced growth from 2 of these factors, the only time it has dipped into the third factor is when it was added to the a second Exchange Website, but that could be considered factor 2. And these factorsare no different than for a currency like the US Dollar.

Community Involvement: Any coins value changes based on how many people are using it. And the usual dichotomy is mining a coin or trading a coin, those are usually the total of any coin user base. With STEEM Community involvement also means Posting and Curating on Steemit.com, as well as holding STEEM Power. The more people that create Content and Curate Content on Steemit, the more people there are with coins at stake, meaning that there are more people with a vested interest in seeing the coin do well. More people also translates into ore Resources. For example, you may have heard of "Human Resources". When you first hear this it may seem like it means "Resources for Humans" but what it actually means is "Managing Humans, as Resources". Human Resources exists in a company to keep their Human Resources happy with the work place. Community Involvement also includes developments around the Coin, for example if a really good mobile App were created and started bringing more people to the Site. Or if a separate STEEM Forum were created for the Die Hard STEEM Users, and became popular. Or if a STEEM User were to invent a new technology, and exclusively share it as a STEEM Link. STEEM also adds community involvement via STEEM Power, when someone has STEEM Power their STEEM is locked away, effectively taking those coins off the market for 2 years and making the available coins more rare.

Trade Volume: This can be a good thing or a bad thing. If the trade Volume is high because a small number of stakeholders (Whales) cash out at the same time, this will cause a drop in price and maybe even a crash. But trade volume can also be a good thing. If a bunch of small stakeholders are putting Coins on the exchanges, the value will go down as each of their coins is added. Because, for example, say the asking price for a STEEM is $3 and you add your coins for $3, this is actually solidifying it's value of $3, when before you put your STEEM on the exchange, all that had to happen for the Price to go up would be for someone to buy up those $3 coins so that all that were left were $4 coins. If you were to Sell your coins instantly, you would have to match the Buy orders. So if you have 5000 STEEM, you could end up selling some of them for $2.90 or $2.50 instead of $3, and because you accepted that lower price, it lowered the price over all. The market cap is based on its trade price, just like the USD, when the Euro gets stronger, the USD trades for less Euro even though the USD did not lose any value against other Currencies, and when the USD becomes Stronger or Weaker, you can buy more or less of another Currency with your USD. And if someone with $1,000,000,000,000 USD goes and trades those Dollars for .50 Euros each, they hurt the Value of the Dollar.

Open Markets: STEEM has not really experienced this yet. But eventually there will be companies Selling Steemit T-Shirts for STEEM, there will be companies sell STEEM Mining rigs for STEEM, there will be people selling Gift Cards for STEEM, there will be people trading Gold for STEEM. And as these markets open up, the Price of STEEM will go up. Because the more places you can use STEEM, the more stable and valuable it is.

News Coverage: News Coverage actually makes all 3 of the other Metrics grow. As the news talks about STEEM and Steemit, or the first person to buy a House with STEEM or the first person to make $1,000,000 on a Steemit post, these stories bring more people to STEEM, bring more buyers to STEEM, and open more markets for STEEM.

Bitcoin grew as the community grew, STEEM will grow as the community grows.