RE: Steem Feels Very Undervalued
I think we have some real value, but to be fair I also think we haven't capitalized on that value yet. What I would say is we have a good base to grow on.
While we do have many great apps and a great community, we have not stopped endusers, haejin and others from devaluing our investment. It's like having a really nice store, but not fighting shoplifters.
Also we've done almost no marketing, so it's like having a really nice store in an unusual neighborhood, but not telling anyone we are there.
Also our largest partner, SteemIt Inc is selling 800k Steem a month, so it is also like having a great store but your partner owns a lot more stock than you and keeps selling.
While I agree we are building a great foundation, we really need to get the NewSteem attitude out there in the world and let people know we are here and open for business. We have to fight bad actors and if we can raise the price and demand maybe we can offset SteemIt Inc.'s selling.
The economics that you pointed out can be simplified to the fact that there is excessive steem out there right now. In a normal economy that operates on an inflationary currency, they would aim to reduce inflation. In the case of STEEM, inflation is programmed and can only be changed with a HF. Its sort of like playing the role of the FEDs. Not everyone would agree with this method since it sort of ties into the whole centralized idea, but none of the less it is the traditional model to control the downward spiral of a currency.
What can we do to combat this if we aren't willing to change inflation rate?
Reduce the supply by adding new users? Thats a secondary problem. The primary problem to solve is why people arent willing to power up their liquid steem to constrict the supply.
One reason is steemit inc is dumping hard and the other reason is inflation is high enough that it becomes a free piggy bank for people to extract money out of. All bad things that can be controlled by the classic method of changing the inflation rate, but then the rewards for the honest users dry up. Quite frankly, its a double edge sword no matter how you cut it and while you can be optimistic that the growth can save us, the reality is that we have no mechanism to stabilize the steem economy right now, its purely free market.
Agreed, it's complicated. Since we have such a poor distribution another tactic is to just know the value will continue to come down some until we can create more value, more things to spend Steem on and some demand for new accounts.
The digital economy (pure digital transactions, similar to steem monsters) is not a reliable economy right now because it produces nothing of useful to keep us living and breathing (at least that i can see right now).
And thats where I'm divided the most. If steem is treated like a real world currency, then its value in USD has great importance. If steem is treated like a digital world currency, how its priced in USD has no meaning, so as long as we price things in steem and keep it stable for digital goods. If that is the case then people may continue to pour in cash (similar to how a traveler goes on vacation where they can leverage exchange rates).
It can go so many ways, and unfortunately there is no driver for it to go anyway at the moment except down because of market forces.
Hey @whatsup
Thanks for the reply. You are one of the names I look out for in my feed.
I didn't know it was as much as 800k, glad to see that is being worked on. Hopefully enough ad revenue comes in that we can actually start a buyback.
I'm in for new steem. :) There seems to be a lot more positive people here and it is great to see.
There is nothing to add to your comment - perfectly said
Indeed, we need another way to stop those frauds from parasiting off this chain other than downvotes that will never do anything than just mildly annoy someone.