Market Analysis and Technical Insight Into Steemit - Basics On How To Boost Steem's Price. Price Of Steem Is Lowest For 6 Months - A Good Time to Buy!

I've been busy the last week learning about the witness system for Steem and also setting up a witness server. I'll be posting more about that soon and starting my 'election campaign' for witness. In the process I have learned more about the workings of Steemit, the pricing of Steem and also the mechanics of Bitcoin... So I have some thoughts on the current low price of Steem...

As of writing this post, Steem is valued at $0.93, which is around the lowest that the Bittrex record shows it has been for 6+ months, down from a high of over $1.70 in the middle of the year. That's a big drop! There are numerous factors involved with the valuation of a cryptocurrency and it is interesting to me to analyse why Steem is apparently so undervalued as compared to other cryptocurrencies which serve little to no practical use (at least when compared to Steem).

One factor is the complexity of the Steem algorithms and payout process for Steemit. The weighting of the payouts continues to be skewed somewhat towards whoever has the most money in the system, so it is a bit unfair from the perspective of a true 'proof of brain' model which is intended to reward the best thinking. What we have is a bit more like a 'proof of wallet and brain' model. This has a knock on effect of people making claims that Steemit is a scam, even though by any definition I am aware of for that word, Steemit is not a scam.

Another factor is that the network has suffered performance issues and longstanding bugs which if not resolved could cause the entire platform to fail. The 'DIY' aspect of Steemit, whereby people from the community are tasked with solving problems, is both a strength and a weakness at the same time in that while it means that a strong sense of community and teamwork can be created in a free environment, it also means that there is a lack of organisation and a tendency for decisions to be made through a developer's lens rather than through system architect and business systems lenses - which are both necessary in such a system. The result has been a tendency to say, "oh well, if steemit.com doesn't work as it should, then the market will just make better alternatives". While that may be true in the long term, in the short and medium term this weakens the growth of Steem greatly and causes perceptions to be soured towards it, resulting in a lower price of Steem.

Greatness means attention to detail

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While alternatives to Steemit.com exist and some are quite nice to use, the fact remains that most people on the web won't know about them and will come to steemit.com by default when looking to participate with Steem. If they cannot sign up due to a broken sign up process (which has been broken in some common use cases - such as multiple signups from the same IP - for several months) then they will likely not use the site and might turn others off from the site too.

If steemit pages fail to load and don't even give a meaningful error message, then again, large numbers of people who come here and who want to read blogs shared via other social sites will just think that steemit is unreliable - they don't care that steemit is a blockchain interface and that steem has other such interfaces - they just see a brandname and either think 'good' or 'bad'.

Bitcoin and Steem's Low

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On a related note, Bitcoin is now at an all time high, which I suspect is due to the upcoming 2 forks which may result in 'magical money' being created for Bitcoin holders as was the case with Bitcoin cash. Understandably, speculators and investors are moving their crypto holdings into Bitcoin to make a quick buck, which means that other cryptos will drop accordingly.

It's easy to predict then that once the Bitcoin forks are completed, a lot of money may move out of Bitcoin and back into alternatives such as Steem. This is a great opportunity for the Steemit devs to fix the obvious problems with Steemit and to win back it's reputation in time for investors to think about moving their funds back into altcoins in a few weeks.

I have been participating in the witness chatrooms recently and attempting to help solve steemit's problems, but it's not so simple since I am not 100% sure who the Steemit devs are and where they socialise. However, it appears from comments in there that my advice for improving Steemit's error notifications and handling of fatal infrastructure faults may have been taken and acted on quickly, which is great if true.

It is challenging to motivate others to move to other social networks, even when paying them, because they are so invested in their existing groups and 'online home'... So it is imperative that Steem and Steemit's devs take seriously the need to improve Steemit.com in the most fundamental ways - which includes improved notifications when pages fail to load and improved communications in general between tech teams and users.

This ESPECIALLY includes informing users if there is a limit to the number of accounts that can be created from the same IP address!

It's ok to ask people to pay to create new accounts if they have already created one from an IP address, but we NEED to know that this is the situation and not be forced to stumble around in the dark until eventually finding a solution, as was the case for me.

Get these basic issues fixed and we will probably see Steem rise higher than it has been for a long time and maybe even a new all time high!

Wishing you well,
Ura Soul

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