The Best News in The World: There Is Not Enough STEEM To Go Around!!!! STEEM A $600 BILLION blockchain????

in #steem3 years ago (edited)

At present, there is not enough STEEM to go around.

Everywhere one looks on the STEEM blockchain, people are seeking out STEEM. There are so many projects seeking delegation makes my head spin. Each day, 60K+ accounts are posting, curating, and commenting with most of them not getting a ton of STEEM for their efforts.

And this is only going to get worse.

How do you think things will be when there are 600K accounts transacting daily on this blockchain? Take the amount of STEEM distributed each day and divide it by 10. Or to look at it another way, take the SP in your account and multiply it by 10. That is the influence one will have proportionately speaking.

There are a few things we need to consider.

The Chinese

I am sure everyone on here is well aware that China is a fairly heavily populated country. There are somewhere around 1.3B Chinese people. Even along the coastline, which is where the advanced part of China really is, there is a population base that rivals the United States.

What many of you might not have heard is that the CCID Research Institute of the Ministry of Industry and Information Technology released it evaluation and ranking of public blockchains. If my understanding of China is correct, the release of this is not to far from the government view since this is most likely a front for the government if it isnt openly a part of it.

Regardless of all that, there is some good news for STEEM. This blockchain chain in second behind Ethereum .

What I focused upon is the fact that STEEM rated very low in applicability compared to Ethereum. I highlighted this on the chart.

To me, this is an area that will close quickly once Smart Media Tokens are released. The fact that people will be able to create projects only limited by their imaginations AND fund them via the SMT protocol should give STEEM a huge step up in this area. We already saw that "content" can really be diverse when Steemians are allowed to create. It is not just text, video, and audio that qualifies. People are coming up with all kinds of things.

This is something I believe will only increase with the release of SMTs.

By the way, Bitcoin was 13th and BCash was second to last for those who are interested.

It's The Bandwidth!!!!!

For those who do not know, the reason that STEEM has no direct transaction costs is because this blockchain operates based upon bandwidth. This is a commodity that is only priced in STEEM, hence requires one to be hodling STEEM to operate. Of course, most who are on here any length of time will not notice it since SP is amassed to more then compensate for it. However, occasionally a newer person will upvote so much he or she torches the bandwidth.

While this is not something to really concern oneself with as a user on Steemit, it is vitally important for those companies that are setting up SMTs on here. For them to function and grow their businesses, they are going to need enough bandwidth to be able to support the growth. Since bandwidth is only acquired via STEEM, guess what token is going to have to be held to get said bandwidth?

If you said STEEM, you are correct.

Now, if there is not enough STEEM at the moment, since over 60% is already tied up in SP, what do you think happens when demand increased exponentially? The inflation rate of STEEM is at or under 9% at the moment so growth at a greater rate than that means it will eat into existing supply. Increase demand tends to increase the price of a token.

This blockchain is fairly consistent at 1.5M transactions per day. If we 10 fold the transacting users to 600K per day, all things being equal, we would see roughly 15M transactions on this blockchain. What does that do to the bandwidth usage?

Yet, if we go a step further, if those people are through a STEEM based interface, it is no big deal just like it is not via Steemit, Busy, or DTube now. However, what happens when a SMT is created and has a lot of transactions? Expand this line of thinking out to 10 SMTs? 100 SMTs? 1,000 SMTs?

Bear in mind, @ned stated his goal is 100K entrepreneurs on the STEEM blockchain in 5 years. While all of these will not create a token, do you think it unrealistic that 1% will? That would be 1,000 SMT created tokens. What does that do to demand for STEEM?

Watch The MVests

@preparedwombat put together an excellent article the other day that covered this which I suggest all read since I will only highlight a couple basic points here.

We are looking at a flattening of the distribution curve. He compared it to six months ago which shows that the smaller accounts are gaining more power as time goes by. This is something that I highlight in my monthly posts about the moves in MVest.

Part of his hypothesis is that, at some point, the MVests controlled by each account level will be more than the next level up. It is a bit difficult to see now although the comparison in the 6 month charts does show it a bit.

This idea does become clear if you think about 600K daily transacting users as opposed to 60K. Also, considering the fact that the daily reward pool has 75% of the new money going to content creators, this shows that the larger accounts simply cannot keep pace with the number of new people when the floodgates open.

The other aspect to this is that MVest, which are really how vesting in the blockchain is measured, are getting more expensive as time goes by. Going back to the article, @preparedwombat showed how each day 1 MVest is worth more STEEM. While it is slight, this trend is going to continue for the next two decades. Thus, the inflation rate is going to require more STEEM to get the same number of MVests. Once again, this is going to make the present STEEM held more valuable.

Give this a read and upvote.

Here is the bottom line...

I do not know if the 1B users that @preparedwombat threw out is likely. However, it is not outrageous to consider that 100M will be on this blockchain in a couple years. When the Smart Media protocol is introduced, we will see hundreds of tokens created in the first year. That will stimulate the use by millions of people.

Underneath it all is STEEM. There is simply no way to look at this picture without realizing that. Any business that comes on the STEEM blockchain is going to require STEEM. This cannot help but to increase demand.

When demand increases at a rate greater than new ones are created, the price of that item goes up. This is what is going to happen to STEEM whether you compare it to the USD, BTC, or ETH. If the demand for this token outpaces the rest (which is should against most of the present tokens), the value of what one is holding grows.

In 20 years, according the a link in the article, there will be 600M STEEM issued. Could it be possible that STEEM is worth $600B by that time? Bitcoin hit more than half of that in marketcap in early 2018 so I do not believe it is totally unreasonable.

Nevertheless, if it hits half of that, those who are hodling STEEM today will be very happy.

By the way, a $600B marketcap in 20 years probably wont even be a top 20 blockchain.

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So the Chinese central bank/gov. drove the exchanges out of the country, even cracked down on miners, but now they are publishing ratings on the public blockchains? LOL

"Any business that comes on the STEEM blockchain is going to require STEEM."

This is what I find incredible exciting. Instead of companies spending ad $$$ on FB and and Twitter, they will just buy Steem to promote their posts on Steemit, which in turn will boost the value of everybody's holdings.

So it's win-win situation for all, unlike the current social media scam companies that hog all the profits.

Yes, it's the new version of Adsense. And it's more long term so you will make so much more money back in return instead of burning it away on Fiat that has Bank inflation.

nice article and makes a lot of sense. i have always felt that steemit's rightful place in the world is as a publishing powerhouse. SMTs will definitely make it happen. imagine that we are a aggregator of aggregators. each aggregator (like Medium), will bring their users on board because there will be a great way to monetize their posts and still have their own select audience. It will also get them the ability to cross sell content to users of other aggregators.

Great points. I do want to note that bandwidth is not gobbled up by upvoting, but by commenting/posting. It’s just VP that goes down by upvoting a lot. But new folks who don’t buy any STEEM often find they can’t post at certain times of the day.

I also see STEEM appreciating quite a bit. The only threat is EOS and STEEM competitors that might be built on that. If people get a sense that it would be easier to “be an early adopter” elsewhere than invest in STEEM to get more traction on here, that might cause a lot of hopping around instead of investing in one platform. You know how people are, as unreasonable an approach as that might be.

The other threat is an irrational market. I already think STEEM is the best investment out there, but you don’t see that in market behavior or most crypto group conversation at all. The market is focused on the wrong things. STEEM has to wait on a rational market to see its true value realized.

I’m incredibly curious to see what happens with SMTs.

The market is so huge that we are not even close to a bubble. We can talk bubble after another 100x in rise on all Cryptos. The world population is going up to 10 billion humans. We have room for 100s of similar platforms. As long as not everyone tries to sell at the same time there is no issue. Just as the Banks can hold lots of money because people do not try to cash out all at the same time. Since it's very unrealistic. We are entering into an Era where money will be a pointless metric since everyone will have what they need already.

What’s crazy to me is the entire market cap for one company (FB, Google, Amazon, Apple) is larger than the entire crypto market. This shows you the true size of crypto currencies. So to think the at some point a single crypto could reach 500 billion isn’t unthinkable. This should be a multi trillion dollar asset class. We have a ways to go but the payoff will be worth it! Thanks for the share!

Surely. We will have trillionaires walking on Earth in the future. It's just simple math and compound growth. Especially in combination with 130 year olds in the future walking around.

I did wonder if all these new tokens, especially GPT would decrease the value of STEEM... but I had never taken the bandwidth into consideration, that's a huge point. Once companies realise they can market their products and businesses for free (with an investment they can later cash out of) I'm sure the Nike's / Walmarts of the world will need to purchase a ton of Steem to get the bandwidth to transact with their NIKE or WMART tokens (for example).

This is really exciting... I was worried that GPT would cause a lack of demand for Steem, potentially reducing our investments, but you're both right in that demand should increase by a lot. $100 Steem might not be out of the question for Dec 2018 after all @taskmaster4450

Here is hoping that we can see that type of move.

It is going to require the release of SMTs soon and for a number of tokens to be created using it. I am not sure the time period we are looking at on that.

More fun numbers and ideas to think about. I wonder with so many whales sitting on so much STEEM, if more demand would be created for them almost buy giving some away instead of selling it (as selling would suppress price for sure in the short-term). I'm sure there must be interesting economic theories about such situations where so much is held in a concentrated amount of hands.

i'm with you on this one and i think about this almost daily, especially since i can't seem to get off of steemit and post 2-4 posts a day. the above message from Task does ring true because it feels as if i'm spinning my wheels for more and more steem. meanwhile, noobs are botting like crazy with one and up to 3 accts as well as following creation trails on those accts accumulating like crazy. that may not sound related, however, thinking about the "new" accounts its makes sense. back to the whale situation, it wouldbe great if they did "give some away!" the other day i was thinking about what if they awarded people with gifts of steem for how many days or a year birthday on steem. it would be a nice gesture, but probably idealistic thinking on my part. ho hum. back to the grind.

There is a point when the price gets so high that it is too enticing not to sell.

Especially since many of the larger accounts were investors meaning that their goal will be to hedge risk. This will push them to sell some of their hodling, meaning further distribution.

It seems the higher the price, the more the larger accounts unload.

Exactly. The big winners will be content creators in this new world.

Damn straight.

You keep coming up with new ways to look at the puzzle I am studying and showing me where more pieces fit.

With the increased demand and the value of getting in early, do you see newcomers in the future as having an even tougher time going from plankton to minnow and beyond?


No. Abundance will be good for everyone. The more people that is investing the better. Because it will raise the value of the whole platform. And more high level accounts can become investors into smaller accounts that seem to have long term potential.

great post as always, i'm glad i have you and papa PW on my side giving me interesting info to always think about. many people think this is idealistic but i like to be idealistic so i'll stick with you two.

Idealism is the future in this new world where anything will be possible.

i certainly hope so .. and pray for on the daily. thank you for sharing your ideas too. :)

For those who do not know, the reason that STEEM has no direct transaction costs is because this blockchain operates based upon bandwidth.

That and we pay the witnesses 10% of all Steem inflation.

I assume SMTs will be like ERC20 in that you pay Steem for the SMT. Actually, I wonder how that will work exactly to stop SMTs from being able to manipulate the market.

I don't think you will be able to buy SMTs with Steem. Pretty sure it will only be sell.

STEEM with be the base currency pair for all SMT's when using the STEEM Decentralized Exchange. For both Buys and Sells.

If you can sell SMTs for Steem you can buy SMTs with Steem. I don't follow you.

Not quite sure about that. Can't you just make it so you can only sell it? Not to a private user but some Steem official place. Not quite sure it takes some more thinking to consider. Markets are interesting and can be complicated.

I hope you're right. I'd much rather own Steem over the long haul than the U.S. dollar or any other fiat currency.

Wow well said. Great write up UPVOTED RESTEEMED!!

Yes! I found this very informative. The future of steem is very bright and i am indeed happy already to be here.
Over the past couple of days and weeks i am starting to get a clearer picture of what SMTs are and the impact they would have on the blockchain.
The future is actually now so let us ravel in the moment.

Nevertheless, if it hits half of that, those who are hodling STEEM today will be very happy.

I agree, although this seems to be unfolding soooo slowly ☻

I love how the Chinese call Steem the "Stimp Chain"... just toooo funny!

Highest rating for 'Basic technology', which is pretty sweet.

Your posts about Steem are a really motivating force for one to stay on the blockchain and stack up some Steem. But unfortunately we are in need of more people spreading out votes rather than vote trading.

Even though the number of Signed Up users have hit 1M, the number of active users remains at 60K from a very long time.
This is mainly due to not getting the deserving rewards for the quality content created. This is the main reason it will take longer than expected to hit that 600K daily transacting users.

I think Curators need to receive as much delegated SP from @ned as the Apps on this platform have been getting.
The main reason I stayed is because I received support from curators like @liberosist, @firepower and @curie when I had started out here.

TL;DR: We need more Curators on the platform. They need to be provided with Delegations.

It will come with time for sure. Everyday the Blockchain is growing in value with all the new awesome apps. Curators will come! I think it's better to slowly drip out value as we currently have. Instead of giving away massive value in 1 go. Just as the Blockchain verify a Block multiple times a human can verify another humans consistency by dripping out value in micro-transactions.

You have a good point.
But don't you think Steemit will have first mover advantage if the adoption is faster in the initial stages and Steem is widely adopted before any competition arrives?
Tomorrow if somebody comes up with a Steemit competitor with all these issues fixed, people will obviously jump ships, in turn reducing the value of Steem. Hence, I was suggesting that.

What makes you think that the value would be reduced? The market isn't saturated. Surely you have tons of Crypto coins but not a single service close to Steemit and it's apps. So even if someone jumps ships we have billions of humans still in the marketplace. There is room for everyone including tons of competition.

What makes you think that the value would be reduced?

They would power-down and sell it before jumping ships?

Surely you have tons of Crypto coins but not a single service close to Steemit and it's apps.

Someone may be working on something better.
Look at MySpace and Facebook for example. Facebook came out later but, in the end, everyone from Myspace ended up on FB because it was better?

So even if someone jumps ships we have billions of humans still in the marketplace.

Word of mouth will obviously be present and besides people go where a majority of their friends are and also where their content would be valued.
Think about Steemit: if only a few whales, dolphins and their friends keep getting the support, only they will be the ones to stay on the platform in the long term. How would that help in mass adoption?

There is room for everyone including tons of competition.

Yes, that's true. But the idea is for Steem to be at the top of the game. :)

Great comment. But I don't think this is comparable to other times since the core structure of value transfers is being set in place here. That will say 3 second transfer and 0 fees and bandwidth system. And no fees. I really don't see someone close right now and I follow many Telegram threads and projects. Haha they are a joke! ;)

Let's wait and watch what the future brings.

But 20 years is a long time, I will be old by then :(

Many of us will live up to age 130. Because of average age always going up because of medicine advancements.

fabulous one.
Very nice i like it

I think This looks really interesting and exciting...
Need to learn more about your information....

You could start by reading it :D

Reading is overrated. LOL

Kings don't read; you read it for them! :P

cryptocurriencies are the future, thank goodness we are part of this..

I really hope that it does well.

That's pretty cool. I'm resteeming this.

That's exactly what I was thinking.All we need is time and some luck so everything will go as planned and devs wont botch anything.I also think that demand will keep growing by a lot.Just hodl guys 📈🤗

Thanks a lot for your latest news of steemit. good job

Great Blog!

Let us continue to connect to each other as we submit more content?

Followed & upvoted!

Luppers :)

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This is a great post. I really want to read more about steem and steemit to get the full picture and this was truly awesome to read :)

thanks for share this information . Upvote and resteemed it thanks @taskmaster4450