RE: What is the Fundamental Problem with STEEM?
2, If or when Tribes and SMTs become the dominant focus, then STEEM becomes a simple utility token like TRX. And it will have a similar price of a penny or two because you only need enough to interact with the blockchain. The desired asset becomes the SCOT or SMT.
So if you want to avoid 3 cent STEEM, something needs to change.
This doesn't make any sense. TRX might be trading at only a few cents per token, but you also have to take into account the fact that there are over 66 billion of them, giving it a market cap of around $1.5 billion currently. If STEEM had a similar market cap then it would put 1 STEEM at over $4.
It would be great for STEEM if some SCOTs or SMTs become heavily desired because it would be (a) great and much needed marketing for the platform in general and (b) Steem Power is required to actually use those tokens on the chain.
I look at STEEM as the B2B token, and the SCOTs and future SMTs as the customer facing tokens. As investors in STEEM we want the customer facing tokens to be as successful as possible because it all creates value for the Steem platform behind the scenes.
Fair enough on the market cap. I should have thought of that.
I agree! But how many customers are we talking about?
It takes roughly 100 STEEM Power worth of RC to do normal posting, commenting, and voting for an average user. And whether they buy the STEEM or the Tribe admin does it and delegates the RCs (if that is ever a thing) doesn't matter much in the aggregate.
How many of those 100 SP users will it take to absorb the inflation? In 2020 according to the chart I'm looking at the daily inflation will average roughly 75k STEEM per day. That 75k plus whatever is being sold from prior STEEM has to be absorbed by the market in one way or another.
Well one idea that has been floated recently, which I am very much on board with, is that at some point if and when SMTs become the main focus for consumers then the "proof of brain" distribution will be removed from the STEEM token, so STEEM will only be used for Resource Credits (much like how TRX or ETH are used today). In that case the inflation would be reduced by around 65%.
So with some quick math, the inflation drops to around 25k STEEM / day from the 75k you quoted, which would only take about 250 new 100 SP users / day to absorb. That should be a piece of cake assuming we have some actual popular applications on here.
Yeah, if that happens it changes the math entirely.