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RE: Why a currency shoudln't be a backup of value. And Why Steem isn't. [3 minutes read]
Have to say I disagree, I think a currency like USD, EUR or even bitcoin should hold value.
I just see STEEM as something different, many it could be classed a 'mirco term currency'? Is there any term like this already?
Bitcoin is a particular form of currency.
It has tremendous leaks as a currency, but this leaks are the ones who permitted Bitcoin to become a mainstream known currency.
The leak is that Bitcoin, becoming scarce, if diffusely used, will be a reserve of value.
This isn't a bad thing: this just mean that Bitcoin is "just a bit" of a currency.
For example gold has value. Is a good reserve of value.
Storing value buying gold makes no bad effect for the society.
But in fact gold is not a currency.
When there is a free economy, people will automatically start to use the "purest" form of money available as a currency, while using other commodities (like gold, stocks), to backup the value they produced or to invest it: this because everyone will prefer to spend the currency that has a more perishable value, so this kind of money will be the most exchanged for everyday's transfers.
The problem begins when there isn't a "pure" form of currency available, and people are forced to use unefficient forms of money.
A currency that has the same attributes of money is more desired because it holds value. From a demand side you can argue that people want money and this is the "sound" driving force to exchange money.
A currency that is inflation prone is not wanted and pushed away by the holder, as you mentioned creates force to spend. Only unsound business is willing to accept this, creating distortion in economies. Just like the dollar today, creating bubble economies and unsustainable debt markets.
I see your point, but a currency is needed, to avoid the scams that I described in my post.
There are many reserver of value, so why using the currency as a reserve of value ?
Steem = currency
Steem Power = reserve of value
isn't that better than
Dollar = currency
Dollar = reserve of value ?
I'm not sure steem is a currency. If the concept of content creation and curation is a sustainable and successful concept, maybe there is a possibility that steem can function as money. But i need to think about this. It's such an intriguing concept
Dollar is based on central banks en government money issuance. Which is clearly unsustainable. Steem is based on content creation and curation. This concept might be sustainable. Then why would steem not be better than the dollar?
What @chhayll said -- Steem is a token used to invest into the platform. Viewing it as a currency ignores what value it actually provides (access to powerup)