What STEEM has but 99.9% of Cryptocurrency Solutions Don't - UTILITY
The Problem with Most Cryptocurrencies
The big problem with most cryptocurrencies is that they are merely vehicles for speculation. Indeed in many ways one could descrie them as a "solution looking for a problem".
There is little to no real world use for them and I say this as someone who is a strong supporter of cryptocurrencies since 2013.
Even bitcoin itself is used mostly for speculation. Whilst many people would like to think of bitcoin like digital money it is in many ways more similar to a commodity.
Why STEEM is different
STEEM has STEEMIT. This provides the killer app and the utility.
Very few people know about cryptocurrency but most people know what blogging is and they most certainly know what social network platforms are.
It is estimated that Facebook has over 1.1 billion users and by 2018 there will be 2.55 billion social network users (source).
The beauty of STEEMIT is that people don't even need to know anything about cryptocurrencies to start using it - it uses the "killer app" to hook them in and start using and creating demand for STEEM before they even know what STEEM is.
If they later go on to learn more about the inner workings then GREAT. If they don't it doesn't really matter because they are making use of it all anyway. Very clever.
But it gets better
Speculation can in some ways be the enemy of utility. It leads to volatility which makes it a lot harder for people to calculate prices and how much they have to spend. It also discourages long term investment. STEEM deals with this with high inflation - yes that's right high inflation.
Isn't inflation a bad thing?
Not always. In this case the high inflation of STEEM is used to encourage people to convert it (power-up) to STEEM POWER (SP) - this is the long term version of STEEM that also grants people voting influence on the STEEMIT platform.
SP grows over time and it can't be sold on exchanges. It can only be sold after being converted back into STEEM which is a long process that occurs weekly over a period of 2 years (called powering down).
The majority of the inflation in the system occurs within STEEM putting pressure on people to either sell or convert to SP.
This helps to reduce hoarding, increases use and also promotes long term investment into STEEMIT. In the long term this should prevent the price of STEEM rising out of control and reduce the price disadvantage to latecomers.
The design of the whole Steem/Steemit system is ingenious.
I haven't mentioned Steem Dollars (SD) yet. Posts on Steemit are rewarded in 50% SD and 50%SP. SD are used as a mechanism to help anchor or "peg" Steem to value of the US dollar.
If you would like to learn more read the STEEM Whitepaper.
Take home message - STEEMIT is the killer app that makes STEEM viable.
STEEM has no entry barrier like other cryptos, you need no Bitcoin to buy-in here.
Exactly. There is no need to sell a "crypto" to the public with this. They know how social networks work and that draws them in. They don't even need to know that a cryptocurrency is involved to start using it.
100 % Agreed. There is almost no learning curve around using it. I do think that there is still a little more work to be done around making the holy steem trinity (STEEM/SBD/SP) easily understandable to new users, but the beauty is that you don't have to understand any of the crypto aspects to begin using the social media platform.
Exactly!
Yeah and if there is something the people aren't real sure about the amount of money people are making will compel them to take the leap and then figure out how it works once payments are going into their wallet.
Good point:)
The major point is that you don't need anything to start earning STEEM (in the form of SteemDollar and/or SteemPower). No hardware, no tech knowledge, not crypto yoda, .. just a simple account!!
and I'm also fascinated about all these new services growing around STEEM, this is only possible because the ledger is open and not hidden behind one company. See for instance http://www.beststeemitsites.com/
Thanks I will check that out!
That's the beauty of it!
Exactly!
So true. No one uses other cryptos for anything but speculation. But here it's made easy and seamless.
Really I liked this phrase:
"The beauty of STEEMIT is that people don't even need to know anything about cryptocurrencies to start using it - it uses the "killer app" to hook them in and start using and creating demand for STEEM before they even know what STEEM is."
Also, It is very important that Users could easily convert cryptocurrency "SD" to fiat or "Steem". Steemit have this tool.
Thanks. I agree:)
Me too!
Awesome
Steemit FTW!
Let's do this!
I like your enthusiasm
I completely agree
Thanks.
No problem
Thank you !
Now there's another.
Keep up the good work!
These spam reply bots are getting out of hand.