RE: Where The Money Comes From - "Digging Deeper Into Steem" (Part 1)
>The more people that join Steemit, earn and use Steem Dollars, the more valuable the network as a whole becomes and ultimately the market cap and network effect of Steem.
The 'network might become more valuable because of that, the truth is steem and steem power does not become more valuable as a result.
>The money is here right now because investors within the system are holding onto SP and the investors outside the system are speculating on the increasing network effect of the explosive growth of users.
Deep down this partially correct. More correct is - money are here because crypto speculators (investors ???, give me a break) buy STEEM (for whatever weird reason they do it)
Some Extended Thoughts on the Subject - "Beyond the STEEM Whitepaper – Chapter 2"
If you think of the value of Steem as the money supply per day, i.e the amount of Steem Dollars printed each day then you'll see they both go hand in hand. In order for an economic system to function it needs a currency in enough circulation to exchange goods and services.
The speculators are buying because of the above point, the money supply and the value of the network.
As for the demand for the Steem Dollar, the demand that generates a need for an ever increasing money supply - well that comes down to the sidechain and subchain 'industries' that can be built. I'll go into more depth in the next part.
Thanks for your feedback.