RE: 3 Reasons Steem Price Will Go Up - And One Reason It Will Not Reach The Moon
Nice read. And it has answered some of the questions i had. I have to counter argument the inflationary issue however. Yes, there is additional steem created each day and correct me if i am wrong it is set to increase 100% each year. But since we can already see ice hockey stick in steemit user growth number of users will double, triple, and may ten fold in one year, of hundred fold if it explodes. Thus inflation will be countered with an increased demand.
Also we will see how user issued assets will impact steem blockchain. The problem now is that steem does not have any utility as far as i know. Except Steem Power bonuses - a sole reason to hold it. But we at BeScouted started building our platform on steem to make it the first decentralized photography marketplace in the world. And we will be probably giving utility to steem. Let's say you are golding 1000 Steem Power then you have access to more advanced features, post more castings, etc... So instead paying each month a fixed membership fee you just hold your steem and maybe it's price will even rise when you do s. We also have contracts on BeScouted where you can hire freelancers for different photoshoots, we are thinking of making an option to pay freelancers in steem directly. I am not even talking about the ability to purchase full ress images from content creator directly with steem transferring all value to the seller instead paying him 20-50% as most stock photography websites do.
What i wanted to say, that the true value of steem blockchain is not Steemit itself. it's the technology and paradigm, that may scyrocket demand of steem that will neglect any inflation factor if developers add utility to the token.
I agree that the platform is an opportunity in itself, I was just drafting something for the next 3 - 6 months. In 2-3 years, provided Steemit stays afloat, the influx of new apps, like the one you're building, will totally change the game.
As for the correlation between inflation and the number of accounts, I don't think it holds. In a country where you have 100% inflation, its effects will be the same wether or not you have 1 person in that country or 1000000 persons. What you imply with the increased number of accounts is that they will burn, or otherwise find some usage for the tokens, which is just speculation.
Well 100% increase in supply is not the same as 100% inflation. Inflation is reduction in value because of price rise of reduction of purchasing power (which are sort the same actually). From August 2008 through January 2009 the U.S. money supply grew from $871B to $1,737B, a rate of over 100% per year and that did not mean US had +100% inflation. As long as there is demand (increasing number of users) and provided steem gains utility properties the price should go up as long as steem generated per user does not exceed new user count. The bigger problem here however i believe is concentration of steem because of self votes and voting other whales and lack of incentive for new users to join and commit creating the quality content. As for now creating quality content does not scale in proportion with time input at all. I could drop a pretty picture of a girl that i have shot 10 times a day and earn more with diminished rewards than making 2-4 quality posts. It just isn't what i want to do with my steemit account. Steem is an amazing blockchain, steemit still needs a lot of effort to make it work. But i totaly get is as it is in beta and i know how ling does it sometimes take to implement features that sound very simplistic verbally.