RE: WHAT CAN WE DO TO INCREASE THE VALUE OF STEEM - Part One - THE CURRENCY STEEM
If we all did that, the only option that any buyer would have is paying more.
This is untrue.
the buyer would have two options. Pay the asking price or not buy.
Imagine for a moment that the market price is .35. The lowest asking price is $.50, and the highest bid is $.20
Question: Assume for that no new actors enter the market. WHat determines where the price will go next?
answer: Whether the buyer or the seller crosses the gap. This is ultimately determined by which actor has a more exigent need (or want) for steem.
The nature of seller needs is clear -- they want cash (or bitcoin). Or they believe that the price of steem will go down.
There is nothing you can do (or others on steem can do) to change the exigency of seller need. People need cash. They need it for hookers, cocaine, and gambling. And also rent, food and bills. Also, some people believe that steem's value will decrease, at least in the medium term (though it is partially offset by price speculation in the opposite direction). There is nothing that can be done about this. Its pretty much constant.
What drives price is the exigency of buyer need? Currently, there is no reason for anyone to need or want steem aside from price speculation (and price speculation works both ways, it also drives sellers). If you say to someone looking to buy steem "50 cents or kick rocks", its very easy for him to say "kick rocks"
If youre looking for a reason for price decline, you have to look at the correltion between volume and price movement.
If steem's decline was fueled by a glut (a bunch of extra steem on the market) , it would be easy to see. What you would see is a correlation between frequent, heavy volume and sharp price decline.
On steems price chart, you see precisely the opposite:
Infrequent, heavy volume accompanying sharp price increase, and frequent low volume accompanied by steady decline.. This correlation indicates that sluggish demand is causing price decline.
What happens when you take a market with low volume and sluggish demand, and engage in price fixing (which, btw, is exactly what youre proposing). Everyone loses interest, and buyers go buy something else. What would you do if oranges cost $150 a piece? What for the price to decrease, pay $150 or buy tangerines?
two more points. Very nearly every bitcoin mining operation not only sells their mined coin, they do so nearly immediately (to pay electricity and other production costs).
That is to say that nearly every bitcoin that comes into existence right now is immediately sold on the open market. And theyre almost always priced to move at or near market price.
You realize that when you use your shift card, you're actually selling the bitcoin, not holding it, right.
That is to say, lets say there is a steem visa card. You go buy a $4 latte with your steem visa card. Whats really happening is that the card issuer is paying $4 in cash to the coffee place, and sellilng $4 worth of your steem on an exchange at current market prices to pay themselves back.
Yes, I realize I'm selling Bitcoin when I use my shift card. If we had one that was fueled by steem, we would be doing the same thing. However, it would make the process of spending steem very user friendly and they would only be selling the exact amount they needed at that moment.
If you are on right now, go to chat.
Point taken. I was speaking in terms of interested buyers, but you are correct, they do not have to buy.
Just an addition: if you refuse to sell under $0.50, there will most probably be no trade, and without trade, no price is set. The price in the last completed trade would stand for a long time, but not go up to $0.50, even when all the sellers agree it is or should be there.