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RE: STEEM Price Touches Historical Low, Steemit Users Number Increases Dramatically - Why Correlation Is NOT Causation
The first stage will diminish the average payment, but if enough people are jumping the train, it will also trigger demand, which will increase price. Then another plateau, and so on.
Increase in the number of users doesn't create demand, increase in utility of steem power does.
Increase in number of users will automatically trigger the need for influence (it's intrinsic to any social media platform) and the need for influence will trigger demand for SP.
Just my 2 cents, I may be wrong, obviously.
The influence you are talking about is meaningless to most users. I would argue that users who buy steem power now don't even do it for the influence, they do it because the price is so low and want an investment in this project but their primary motive is not to increase influence.
The influence is not a need, it is similar to upgrades and power ups in games, you can play the game for free but without these extra power options the game sucks.
This is correct, though as ive noted elsewhere, this increase is mostly fictional.
The real problem isn't that the influence is meaningless, its that you can't buy a significant amount of influence for a reasonable amount of money. Part of this is concentration of stake. Part is the amplification of that concentration by n^2.
Look at the biggest whales like @blocktrades or @abit or @freedom. How much would you pay for parity with them? How much do you think the average man on the street would be willing to pay.
Way less than the amount their steem power is worth, even at current ATL prices.