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RE: Here's Why Bitcoin And Other Cryptos Have Soared
I must question this part ..
"There's still no logical financial explanation why hundreds of thousands of people posting online would get paid handsomely,"
that applies to all crypto though ... why should mining for any crypto pay..
really it produces nothing but some math that spits out a coin '''at least steemit produces something be it just bad media or good ...its at least something ... not just burning up giga watts of electricity .. so as a mining scheme its far far better than the rest and more fun ... everyone gets to play... as for the game makers here ya they seem to need to get on top of a few things before it bites them in the ass ....
Mining increases the complexity (computer calculations required) to produce a single Bitcoin, thus reducing the possibility of anyone being able to produce a Bitcoin on his own.
If anyone has a powerful enough network of computers, he can produce fake Bitcoins, which effectively removes the cap off the currency. And if there is infinite supply, the price would be infinitely small.
Doesn't this remind you of Steem?
Now to answer your initial question - would you rather be paid in Steem or Bitcoin? In other words, would you rather be paid in metal coins (which are not worth the metal they are made of, because metal is widely available) or in gold coins (which is a rare and hence expensive material)?
I'm not sure I have enough background to comment on your original post, but I have my doubts about the notion of gold as being a hard currency that is better than so-called fiat money. After all, gold fluctuates much more. People say gold is a safe haven because its price is based on some intrinsic value in a way that printed money is not. Intrinsic value to me means the usefulness of its physical properties. Gold
has practical uses, mostly as a good electrical conductor that does not tarnish, but I think the monetary value likely outweighs this industrial value by multiples. As is often said, gold is sought as a store of value because it is rare and impossible to manufactor outside of massive fusion reactions. However, the idea of intangible money is very much the same. Make it rare and impossible to conterfeit. The difference is that the price of gold is set in international markets and cannot be destabilized by the actions of a single government that controls a currency... Well, except for the fact that only a few countries hold 99% of the gold supply and could drive the price down by selling off massive chunks of it. That could happen if they face destabilization, the same as hyper inflation caused by money printing. The difference is that there is a floor to gold devaluation determined by finite supply. ..crypto currencies have the potetial to be like gold, but under the control of no soveriegn. Maybe I agree with your original post then? Because bitcoin has boundaries? I disagree mainly with the analogy to gold. And if we get to a point where the only reliable transfer of value is intrinsic value, we may be better of hoarding non perishable food or clean water.
I see. Well, I'm not discussing the intrinsic properties of gold, but looking at gold as a rare commodity, which drives its price up. We can talk about paintings, rare stamps or ancient coins, in much the same way.
That's why my point was that a currency like Bitcoin will keep increasing in value, while a currency like Steem will not. Steem, along with many other alternative currencies, is only useful as a medium for money laundering , which is the reason of its recent price peak. So Steemians should keep their fingers crossed that this or a new ransomware keeps spreading around the world.
You can also look at the BTC/Steem comparison from another angle. Imagine there is a brand new social media like Steemit - would you rather get paid in a newly created cryptocurrency or in BTC?
A new cryptocurrency will not be immediately accepted by exchanges, as it may have technical flaws; if, at some point you can trade it, it will be for BTC anyway, because BTC to fiat exchanges usually don't trust any other cryptocurrencies yet; which in turn means you have to pay exchange fees and lose money.
If you were paid in Bitction, you can simply convert it to a fiat currency online or at an ATM. And you don't have to worry that tomorrow its price may have dropped ten times.
Which brings us to another point. Why did the Steemit developers choose to create a new currency? First, they needed a currency with an endless supply, otherwise people would have to invest their own money to buy BTC and upvote other people's comments (Steemit would've failed immediately). Second, they knew that this was a great opportunity to become millionaires - as it often happens with the first people to mine any new cryptocurrency.
Ok, I see how my discussion of gold was a bit of a digression. I see your point. I came here because it was an effecrive blogging community where the advantage if reward was icing on top. However, once I got involved, the sight of those little numbers going up, however small the amount, became kind of addictive. I suspect a lot of people are similar in that respect. Steemit offers the possibility of owning a piece of the platform as one might own shares in a company, but to what end? Internally, it provides some control, but in that respect it is not unique. You also get a share of the profit, but that profit is the "shares" themselves. I'm catching up here. I suppose if steemit continues to grow, it may gain the weight of a more established cryptocurrency. And it's current model does seem to be driving growth. But you are right... Does that mean people can or will use it like any other currency? Would other people or companies not interested in blogging exchange in steem based currency? It doesn't offer special advantages if you're not a blogger or a speculator... Or a criminal. You have a solid point.
Agreed :)
Still a silver guy but always want to make a buck lol
A good old silver ounce in the pocket is rhe best as far as i and history are concerned i think
printing or mining endlessly will decrease value...but chopping a limited amount into smaller and smaller pices and increasing its value is almost the same thing ...
What do you mean by "chopping a limited amount in smaller and smaller pieces and increasing its value"? Which currency are you referring to?