Do people buy Steem? What is the "actual" value of Steem ?
I was thinking the other day about my Steem Power and if I should invest in Steem by buying some from an exchange and then powering it up. At first I thought this was a good idea as I seen it as an investment in Steemit.
So I headed over to Bittrex and got some Steem, I then sent it to my wallet and powered it up giving me around 440 in Steem power. At full voting power I can give people 0.07 per vote.
I thought considering the amount of money I had just invested that didn't seem amazing. So I had a look into the value of Steem and it's historical price rise and falls.
The following is taken from https://coinmarketcap.com
It was shocked to see that Steem hasn't actually gone anywhere for a very long time in terms of price increases. Which shocked me as I hear daily here on Steemit about how big this site is getting and how Steem will reach $10 one day.
Surly if the user base is growing at such a huge rate then the price of Steem should follow? (supply and demand)
As you would think users of Steemit would buy Steem in order to power up therefore driving up the demand, but this doesn't seem to be the case.
I see so many different alt coins out there that don't actually do anything different to other competing coins and then I look at Steem and see how much it's being used in a real world example here on Steemit and yet it's price hovers around the same time and time again while the other coins that other very little if anything different are skyrocketing.
Is this because Steem is made out of thin air that it's value doesn't seem to change much?
Look at all these ICO's making millions overnight when the companies operating them offer nothing in return at the time of investment.
So my questions are.
How many people buy Steem and then power it up? and how many people simply cash out their earnings each week from Steemit?
As usual thanks for listening
Happy Steeming Steemers and Steemettes.
I think the fact that the gains are in the platform growth and not the actual currency a good thing. Unlike other cryptocurrencies I think Steem will be a stable option. If confidence drops in the currency, the platform could compensate with other means of funding such as 'ads' on posts until Steem regains some confidence. I think during growth ads should be avoided but once the platform has a very large audience and a high usage equivalent to Twitter a method could be introduced to make cash by including ads in your posts.
Thanks for your input.
What drives the price of cryptos up is the investments in real world money terms on the exchanges. If not many are buying Steem then it's price won't rise. I read an article awhile back where the author states why would you buy Steem when you can generate it for free by blogging. Which is true I suppose.
This site is a great platform and even if the price of Steem never went up it still rewards people where the likes of Facebook doesn't, so I'm not bashing Steemit because I love this site.
I'm just cautious of people investing heavily in actually buying Steem when there are no signs of it going up in value. I hope I am totally wrong.
"I think Steem will be a stable option" that is a very good point as it does seem to hover around the sam price consistently.
Thanks again for your comment.
I am asking myself the same questions as you are. It is for this reason I am only invested for a little bit into STEEM. I can see the potential, but it's really hard to grasp the value proposition. It could be valuable, if business would buy Steempower so they could advertise their messages on the Trending page, for example.
Also, just having the biggest amount of users is in itself a value proposition. Look at how many multimillion dollar companies with large userbases have never turned a profit.
Then again, I have trouble with those investments too.
Lastly, the newly announced Zappl and D-Tube are enhancements that are sure to bring in many new users. Wether it will bring investors as well? I am not sure. I think, with today's market and hype surrounding crypto, Steem has a short term potential to double or even get to 1 billion if market growth continues as it has been. However, in order to get anywhere bigger I think we are going to have to wait for mass adoption of the platform in order to capitalize on that.
Thanks for the comment. It is a strange situation as before Facebook had adverts it was valued into the billions, Steemit's user base is growing at such a pace and the backbone is ran by Steem. So for me it's logical the price of Steem would be on the up with it. I think the fact it is created out of thin air is a major sticking point, but only time will tell.
I think that there is a general glut of alt-coins now. I believe its gonna get there.
Thanks for the comment.
On Jul 13, 2016 Steem had a high of 4.93 compared to the average 1.20's of this month and previous months. I just wonder why if so many thousands upon thousands are joining Steemit the price isn't going up accordingly. It seems not many people are actually paying for it.
The value of Steem (like any currency) depends on 3 factors;
Supply (how much Steem is available in the market)
Demand (how many people want Steem, and what they're willing to pay for it)
Intrinsic Value (the asset backing the currency)
The supply of Steem is currently increasing because new Steem is issued at an agreed upon rate (Roughly 65,000 per day). The demand is also increasing because we are adding users to Steemit (Roughly 10,000 users per week). Because the Supply is currently outpacing the demand, market makers work to "stabilize" their investment at around $1US per Steem/SBD (the price will typically fall between $0.80 and $2.00)
The intrinsic value is where the real question comes in. What is Steemit worth?
Note that I said "STEEMIT" not "STEEM".
Steemit is the asset backing Steem. By increasing the value of the asset, we increase the value of the investment instrument tied to the asset.
How do we increase the value of Steemit?
We increase the value of Steemit through thought provoking content and high quality conversations. When Steemit becomes a hub for information, that information will command capital and that capital creates value. For example, Google would be worthless as simply a search engine, but it's worth billions as an information mine.
Thanks for your reply. There are a lot of valid points in there. As I have said in other comments, Steemit is a great platform and I love using it, even if the value of Steem never went up or even halved your getting more in rewards than you would from Facebook.
That being said Steem is made out of thin air, things that are made that way struggle to find value. I'm sure if there were infinite Bitcoin available it's price wouldn't be so high.
The fact you can earn Steem for free by blogging makes me think why would people pay for something they can get for free? Where is the incentive?
Not everyone can earn it. Earning Steem for more than a few days takes consistent work and quality content. There are many people who would rather buy an investment than work for it.
There are also people who do both.
Thanks again for your input.
How many people do buy it though is the question? If the demand for people buying it went up then surly the price would follow?
What does owning Steem get you besides increased voting power? Is there a financial advantage to having a greater vote in the community?
The answer is YES! When you have greater Steem power, your vote is in demand. What is the best way for people to get that high valued vote? The best way is to read your posts, upvote you, and write about topics you're interested in so you will vote on them.
It's not worth it for the self vote (because the increase is nominal). It is well worth owning Steem Power for the esteem that comes with it. That greater esteem will earn you more votes for your content and thereby more income.
I get what your saying and I agree 100%. What I'm asking though is how many people go to Bittrex or any other exchange and actually physically buy Steem with actual real world money (well Bitcoin if your using Bittrex)
The answer looking at the market cap, appears to be not that many compared to other alt coins that don't really contribute much.
I hope one day Steem and Steemit gets the recognition is deserves as it is showing on a daily basis only positive things for blockchain technology.
There aren't many who do because it's a relatively new currency.
I think it will gain much greater value if we could somehow untie it from BTC.
Yeah I think your right there. Thanks for engaging in my post. Followed you and I will have a look at some of your work.
Most cryptocurrencies other than BTC/ETH are used mostly for trading and not real world use. Steem stands as an exception to this, because it actually has a use other than trading.
I think over the long term, practical real world uses are what will matter for a cryptocurrency to survive and grow. Just look at Ethereum, it was built from the ground up for real world, practical applications, and in just 2-3 years, it has rocketed to the #2 position ahead of a lot of things that came before it.
Yes I agree that in the long run only cryptos with actually real world applications will survive. It just seems odd that these ICO's are generating millions with zero promise of anything at the end, whereas Steem is a proven platform that is used to power such a large site as this but seems stuck on the markets.
Considering as you say it has a real world use and can also be traded it should put it way out in front of most of the competition but thats not what we are seeing.
Thanks for the comment.
Well, even ethereum languished at sub-$1 rates for months before blowing up. So maybe it takes time for cryptocurrencies with real applications.
@originalworks
This post has received a 3.47 % upvote from @booster thanks to: @somecoolname.
I bought about 2500 STEEM just because if I have money in it I will spend more time in it. The whole vested interest thing. Glad I did. I enjoy Steemit.