Say this out loud:
"STEEM is not Steemit."
The cryptocurrency STEEM, which powers the STEEM blockchain, is separate and distinct from Steemit, the social media website where you are probably reading this article. In this post, I'm claiming most users of the Steemit.com website are confused about the real value of this blockchain (though not of the value of Steemit.com).
Try saying this out loud:
"STEEM Is More Valuable Than Steemit."
That's a little more difficult to say, isn't it? Most of us love Steemit. We love the relationships, the conversations, the education, and the value it brings to our lives every day. That's all true. As I linked to in my #SteemitIsToMe: Relationships, Reputation, and Rewards post, I still think the currency of steemit isn't Steem Power, STEEM, or SBD (it's relationships).
My claim here does not contradict that position. We have a good grasp on the value of Steemit. We point out things like Alexa ratings all the time. We rave about it to our friends, pleading with them to ditch Facebook, Medium, Reddit, and Twitter. We repeat the slogans we saw at signup about rewards and getting paid.
Steemit certainly is valuable on many different levels.
BUT WHY???
Pause for a moment and ask yourself the deeper question. This is something I talked about last year with regards to cryptocurrency valuations in general with the Bitcoin Pizza challenge. On May 22nd, 2010 someone bought a pizza for 10,000 bitcoins. Today, bitcoin, as a currency, works much worse than it did then. Value is subjective and determined in the moment of transaction.
Steemit, from a purely financial/monetary perspective, distributes value because investors and speculators choose to buy the STEEM token. Investors and speculators drive all the financial value we see here.
SBD above 1 USD?
That's investors and speculators.
STEEM price pumping?
Investors and speculators again.
The market cap of the STEEM cryptocurrency is currently $1,048,779,049 USD. That billion dollars in value is just a transient idea, but it comes from investors. The reason some people aren't using other more established social networks and coming here to start from scratch is because they are getting paid in tokens of real value for what was previously something they did for free.
Just like most other cryptocurrencies, new STEEM is being created and distributed every day.
Figuring out how much new STEEM is actually going out is quite tricky and involves a formula like this:
new_steem = ( ( virtual_supply * current_inflation_rate ) / ( 10000 * blocks_per_year) ) * content_reward_percent;
My very rough calculations show around ~2.28 STEEM per block or ~65k STEEM a day which has a rough value of $273k.
In comparision, 1,812.5 new BTC were created in the last 24 hours which is over $2M.
I've already talked about why I'm such a fan of Delegated Proof of Stake (DPOS) blockchains Like STEEM, so I'm not going to waste time rehashing the POW vs. DPOS debate, but here's a summary:
Thanks to @kyriacos for this image (which is great), but it promotes the Steemit logo, not the STEEM logo.
Other blockchains and cryptoCURRENCIES are struggling to actually function as currencies:
ETH:
And STEEM:
BTC barely works. It can't keep up and yet more inflation (in USD terms) is happening there than on STEEM.
STEEM is an amazing cryptocurrency.
Zero fees.
3 second block confirmation times.
Energy-efficient DPOS algorithm.
Built-in, on-chain governance.
Account recovery (unique to this blockchain).
Time-locked savings via smart contracts for SBD and STEEM.
User-friendly wallet addresses (instead of complicated hashes).
Did I mention zero fees?
STEEM is an amazing cryptocurrency by almost any measurement. From a purely technical perspective, I'd be hard-pressed to find something better.
So why is it ranked 36th and not number 1? Well, that's not an easy question to answer because it involves a deeper dive into network effect and, again, the subjective nature of value determined by many individuals in the moment of transaction.
One possible explanation is that STEEM, the cryptocurrency, is getting confused with Steemit, the social media platform.
They are not the same thing.
Investors create all the financial value we enjoy here. When it comes to bitcoin mining, I see few people complaining about who gets to earn some of those 1.8k newly minted BTC because the expectations are super clear: whoever buys hashing power gets proportional rewards for what they paid in, based on the current difficulty. For STEEM, the expectations are less clear. As I talked about 6 months ago, from this perspective, it's difficult to clearly define things like self-voting as scammy behavior or a rational ROI strategy. I have my personal opinions about this which is why I've only self-voted 1.1% of the time in the last 90 days.
There's a lot of discussions about rewards pool abuse, unequal distribution based on content quality, and scammers manipulating the system with bot armies and thousands of fake accounts. It's all certainly a concern which deserves much of our attention if we want to improve Steemit, the social media site, and the claims it makes about being rewarded for your words.
That said, imagine, if you can, if the social media side of the STEEM blockchain went almost entirely away. Imagine if all we had was the currency itself with clear expectations about new coin distribution. Maybe it would all go to stake holders or maybe it would be a random distribution to existing addresses. The point I want to drive home is this:
STEEM, the cryptocurrency, would still be far superior to other cryptocurrencies even without Steemit.com.
Steemit, the social media site and how it interacts with newly minted STEEM distribution, is almost a distraction from the value of STEEM, the cryptocurrency. When we focus too much on the reward distribution and not enough on the STEEM blockchain itself, we create confusion for investors. They hear "scam!" concerning abusers on the social platform which distributes new STEEM and equate that to concerns about the currency.
The STEEM blockchain is valuable by itself, and its reputation is worthy of defense and promotion.
If we lose sight of that, we may harm the financial value of both STEEM and Steemit.
Takeaway:
STEEM is not Steemit.
STEEM Is More Valuable Than Steemit.
What are you doing to promote STEEM, separate from the value of Steemit.com?
Steem is the blockchain, Steem is the coin, SteemIt is the Front-end UI, so in a word, Steem Rocks.
Agree with this, Steem has a very bright future, however this correction will probably go deeper. I cover STEEM and SBD in my latest blog post:
IMPORTANT Coin Updates 2 (BTC, SBD, GNT, STEEM, XVG) https://steemit.com/bitcoin/@benkalashnikov/important-coin-updates-2-btc-sbd-gnt-steem-xvg
We are steemians :)
I agree with you.
I actually don't necessarily agree that STEEM by itself is useful. What makes STEEM useful is the ecosystem that STEEMIT create around it that gives its usefulness. One can come up with other unique characteristics that make other alt-coin unique like ADA, XRP, IOTA, etc.
It's the ecosystem. Alone, STEEM would just be one of the coins out there that competes for people attributing value to it. To me, there can be so many supplies out there for other coins that it renders the argument that each coin has a finite supply obsolete.
That said, if we can work hard and make this ecosystem better, STEEMIT won't be just the only manifestation of the usage of STEEM but there will be other real life scenario that can leverage STEEM capabilities.
I listed the characteristics in the post which make STEEM, by itself, better than most other cryptocurrencies. I think we can evaluate things purely within that category. Of course we can also look at the broader ecosystem (and we should), but I still it creates confusion for investors looking just at characteristics they want in a cryptocurrency.
Have you looked at the steem backed dollar?
Great post I am new to all of this and this really helps me understand what Steemit and steem are.
Great article. Sometimes I need you guys to "put it on the bottom shelf" so I can understand it better.
Thanks!!
this post is amazing amazing amazing!
What's quiet a bold claim. Steemit.com allows users to easily transfer and use SBD and Steem, without the user-friendly UI, most non-tech people wouldn't even bother with Steem!
Sure, the Steemit blockchain can stand alone without Steemit.com, but who would use it? Without usage, there is no value.
Do "non-tech people" drive the value of the STEEM token, or is it hardened, seasoned, cryptocurrency trading professionals with extensive technical knowledge of this space?
There is no such thing. It's the STEEM blockchain, not the "Steemit" blockchain. This common confusion is the problem I'm describing.
"Without usage, there is no value" makes sense in terms of Steemit, the social media site, but when it comes to global payment networks, the technical capabilities of the system have huge implications for the future (often considered "priced in") valuations. Like the bitcoin pizza example. It wasn't used as currency at that time so 10,000 bitcoin barely bought a pizza. Now it's used globally. Usage does mean value, but you don't need social media content for the STEEM blockchain to be useful as cryptocurrency due to its technical properties as cryptocurrenccy compared to other options.
That was the point of my post.
Awesome article. When I was looking to get into something besides bitcoin I recognized the points you have made here with steem. Steemit was just a bonus that helped to solidify my decision. IMHO BTC will continue to hoover around 10k and people will find potential in other coins like Steem.
So glad to hear this explanation is helpful for investors looking to make decisions about future value. For me, STEEM is a long-term hold with lots of potential, especially when it supports the Smart Media Token ecosystem we'll have in the future.
Great points @lukestokes thank you very much for the explanation. I see it similar, that it is a very nice perk, that are closely related. As of right now, they are so closely linked because it is its' most commonly used/referred to instrument for steem. Steemit is a (very nice) fringe benefit, added value, "gravy" benefit as I see it as well. I was sold on steem in hearing an explanation of it from stan larimer talking about basic blockchain concepts, and steem's abilities already in place to handle massive transaction loads. Steemit is a tool that has generated in the exchange of the crypto of the future in my opinion. Very helpful, stellar points, I am very glad I came across the article!
Agreed @lukestokes ! SMTs will make the entire Steem Blockchain to be understood much more, which so many projects that will flourish after it! Hopefully SMTs are on the next block and starting soon!
Regards, @gold84
first of all,thanks for such a wonderful information and i really appreciate your post.
bitcoin market is crash now a day but steemit is more valuable in future and steemit make the market up and no other coin crash this.i believe it <3
keep sharing this type of info and update the market i appreciate u sir <3
@sibtainali
Thanks for this article @lukestokes It is a helpful tool for understanding something I have felt about this platform and currency. As a member of a few content industries at different times, the content/attention game has needed some working on.
Not sure... I think BTC is the better play right now and altcoins will be a bit bearish why BTC takes off. The liquidity pool of BTC & higher volumes mean a nice rebound (perhaps).
That's been the usual play where alts stay down as BTC skyrockets and then when BTC goes flat, traders get bored and buy up all the alts. I have a feeling this rebound will bring everything with it together since everything went down together. Wait and see, I guess.
That seems like a reasonable prediction. And you were proven out to be generally correct.
I can see so much useful information and comments here. Thanks everyone for discussing these important matters. My take on this is healthy price- correction gets amplified by short-term traders (the majority). The whole market suffers including STEEM and SBD. You can check other ideas and comments here. Thanks.
The first thing that I do when introducing STEEM to someone is explaining that SteemIt is not STEEM. Reason for this is when Steemit goes down they start complaining that STEEM is shit and not working properly.
Yes, that's a really important reminder also. Even if Steemit.com (the social media site) is having trouble, STEEM is humming along nicely.
But the main use of steem is as steemit.com, outside of that, there arent much uses for the steem token. Its the same issue with all other coins, they dont have real uses yet and on top of that, they have zero product out there to support their coin.
Steem atleast has a social network that employs the steem blockchain. In that sense, so as long as steemit survives, steem will always have some value.
I think you're still using a utility theory of value instead of a subjective, "in the moment of transaction" theory of value. I can respect that and talked about it here 4 months ago: Do Cryptocurrency Speculators Fear Utility? I think there's a balance between the utility helping create the story which supports the subjective theory which actually drives the decision to buy or sell.
I just read your article, and if I get your point, you are saying that there is both an objective and subjective value. The difference being the future value.
Is that correct? If so....
You are correct that objective supports the subjective, and I see that, but I'm talking about the long term results of all these coins, which is how people are pricing in the value.
We have a lot of future value baked into these coins, of which we assume some sort of future utility thats worth more than its existing utility. And as you said, speculators become investors at some point.
Where do we stand with the steem blockchain right now? I think it has limited use at the moment ONLY because we haven't found much use for it yet. HOWEVER, I think there is massive potential for its use in hundreds of applications. The problem is discovering that usage.
Fair enough. However, again, Bitcoin has way more "value" in terms of market cap than STEEM and yet STEEM (just as a currency) has better features and thus better future potential utility value from a technical perspective. Again though, it's the network effect of perception that gives any currency value. Either way, STEEM has a lot of upside, and I'm excited about that. :)
I can 100% agree that STEEM has a lot of upside. There is a host of potential for this blockchain above all others. I think we need to capitolize on that aspect because this coin generates its own attention that is worth putting effort into.
What about busy.org, eSteem for Android, Steepshot.io, d.tube, chainbb.com, zappl.com, and dsound.audio? I'm sure I missed a few, but you get the idea...
While I agree with you that Steem is definitely MASSIVELY undervalued as a currency compared to the unbelievably less-efficient BTC, ETH, and LTC, I feel like you're selling Steemit short. The problems we face now with the way Steemit works pale in comparison to the potential that this nexus of blockchain technology, digital finance and social media has.
The cultural dominance of Facebook, Twitter and Google (through YouTube) over the past decade-and-a-bit has proven the power and significance of social media. In parallel, the explosion of the fintech industry has demonstrated the importance of virtual money in theory and practice.
"Bitcoin" and the first generation of cryptocurrencies it's often used to refer to in the media is, in my view, valuable the way an antique vase or car is valuable. You'd never actually use it for fear of depreciating its value, a value based entirely on what it represents and how much others are willing to pay for it. Pure speculation.
The Steem blockchain has a working application (yes, Steemit) used by tens of thousands of people around the world and generates enough money to actually be some of its users' main incomes. Yes, this is because Steem itself is an incredibly well designed currency, but so are Ripple and Stellar Lumens and many others. Steem has value because it's being used IN PRACTICE in a SOCIAL MEDIA PLATFORM. The two biggest innovations of the 21st century so far, together in a package and (as of yet) mostly undiscovered by the masses.
Don't sell Steemit short. Even if this site doesn't end up being the final iteration of blockchain social, even if it does become the GeoCities or MySpace to some future blockchain social platform's Facebook/Twitter, Steemit is the proof-of-concept and a vision of the internet's future.
This is a common challenge for many. If someone says "X is better than Y" it does not mean Y is crap or not valuable. I tried to make clear in my post how valuable Steemit is and how most of already understand this. I've spent a year and a half writing articles about this.
What I think we are doing is undervaluing STEEM by only talking about the value of Steemit. Your Ripple/Stellar examples don't work as well for me because they are centralized and don't have built-in, decentralized governance like DPOS controlled by the community. The key point here is the investors in the STEEM token generate that income you're talking about, not some intrinsic "value" of the content itself. There are no ads here. There is no income. It's just like bitcoin in terms of "pure speculation" only we have a much better story to tell ourselves because of things like Steemit, DTube, Utopian, etc. The utility value we can see informs our speculations about future value. Utility value is important, but I still think it's just part of a story we tell ourselves.
I'm definitely not selling Steemit short by comparing it to STEEM. What I'm hopefully doing is realigning our understanding of value by correctly understanding how valuable STEEM is, given our understanding of the value of Steemit.
I haven't read much of your other stuff, only stumbling across this article today. You're not wrong that X>Y does not mean Y=0. However when you said:
"Steemit, the social media site and how it interacts with newly minted STEEM distribution, is almost a distraction from the value of STEEM, the cryptocurrency. "
I definitely read that as a dismissal of Steemit. Moreover, being that Steemit is the flagship app of STEEM, it's hard not to tie the value of one to the other.
In your article on utility, you said:
"When [the hype around a cryptocurrency project dies away, and we're left to evaluate its actual utility at accomplishing stated goals], speculators turn into investors. They turn off the wishful thinking and start making more rational comparisons to other players in the space both inside and, importantly, outside the cryptocurrency scene. "
So is the value of STEEM right now a function of its utility, as you implied there, or pure speculation with a slightly better story? Isn't the fact that a currency used mainly to assign monetary value to internet content has any value at all an assertion of its utility?
I suppose my main disagreement with you it that STEEM is objectively more valuable than Steemit. The two are, at least right now, inseparable. And when the inadequacy of BTC, LTC, ETH leaves them in the dust, STEEM will probably experience a new speculative bubble based on both the superiority of its blockchain and the success of Steemit.
I think what this article is trying to articulate is how the stated goals of STEEM (and Steemit, the company, if you go by Ned Scott's statements at Steemfest) isn't about the social media site, Steemit. Most (myself included) didn't get this right away. They think, "Of course the Steemit social media site is the main product!" The reality, I now think, is closer to this being a reference implementation for what's possible on the STEEM blockchain and just one part of the vision to tokenize the web. The focus of Ned (from what I understand) and his company is to build out Smart Media Tokens to accomplish that tokenization. STEEM is the blockchain that will do that and it will be done without Steemit (the website) even having an interface to deal with SMTs directly to begin with (from what I understand).
So I'm still doing the same comparison. I'm comparing STEEM, the cryptocurrency, with other cryptocurrencies. I don't necessarily have to compare it with options outside the cryptocurrency space because that would be redundant (they all share those same benefits, for the most part, against fiat currencies).
The fact that the STEEM cryptocurrency has utility outside of just being a cryptocurrency which includes supporting social media activities (user account creation, content creation, voting, etc) is a bonus.
Today, STEEM is used (and thought of) by many as a social media blockchain. If they just thought about it as a cryptocurrency alone, they might value it much higher than they do now, based purely on it's technical capabilities as a cryptocurrency.
OH okay gotcha. I think it would have been more clear if you’d emphasised the “tokenising the web” part from the outset. I definitely agree with you that that aspect of the STEEM technology is going to be immensely valuable. In that context, yes Steemit can be seen more as a proof of concept than THE Steem product.
@lukestokes
Since starting out on @steemit I have manged to get a fair understanding regarding the platform and later realised the value behind the coin.
I am fundamentally driven by the ethos and philosophy behind steemit, and the idea of sharing not only on a creative level but also on financially too, which has helped so many people through education, interests and just generally a better understanding of what people around the globe hold dear. This in itself makes this platform special, in that it brings people together on a more existential level, and also almost forces positive experiences since generally it is positivity that is rewarded.
Also inspiring to see people now being able to generate an income, where before they had no means of supporting themselves or their families.
I do believe that @steem the coin itself is highly under valued, based on the functionality behind the coin and I think we are in for some huge gains.
So I plan to continue stocking up on @steem coins in support. Will continue writing my little posts whether I earn 1 cent, I am thankful for a place to have my say and stand the chance of earning something for it, no matter how mundane it may be, lol
Great post, stay blessed
Well, here's a little upvote for your comment here. Thanks for contributing. :)
Thank you.
It's pretty crazy to think about (which I guess means I'm down the rabbit hole) but you are totally right. I'm pretty emotionally invested in this place, but when it comes down to it the Steem blockchain, and Steem itself has much more value than Steemit. Still I really like it here, and I don't want it to turn into just another crypto to be bought and sold. I have plenty of those. I like being able to be rewarded for my posts, and for my hodling.
Take the red pill! Join us down the rabbit hole! :)
Haha, I'm on it, see you there in a few ;)
Great points, which are often times overlooked, as a whole. With steem being so unbelievably efficient (S/O to Dan Larimer and the other steem fathers) and so valuable as a blockchain technology, I can only see this benefiting steemit in the long haul... only problem here is that SP is going to get harder and harder to come by, so if you want to profit from steemit power up while you can... STEEM(it) on my friends
That's a good point. The ratio of 488.379 STEEM per MVEST will never be lower.
Agreeeed... & especially with Steem's recent tear, it is and will continue to out-surpass that of SBD, making those who join later out of luck in terms of good exchange rates for SP since 1 steem = 1 SP
Done! And in the first 3 months, I didn't know what's the difference but with the passage of time, I came to know the difference and introduced this platform to about 20 people. Right after that, I started working on coding/programming stuff and will be making my own application on Steem blockchain.
Excellent! I look forward to hearing about them. Link me in a comment once you get something together for others to take a look at.
Damn right!
One of the best ways to recognize that Steem is more valuable than Steemit is the fact that other applications that have been built on the Steem blockchain later than Steemit, are developing much faster.
Besides the new design (whose implementation caused significant downtimes of the whole website for weeks) including the fancy night toggle mode which is anything but useful, the UI hasn't changed. Even though Ned promised the site to become more userfriendly (quote) at Steemfest no. 1 in Amsterdam 2016 (!), that didn't ever happen.
Just consider @dtube for instance which will probably revolutionize the market for online video content. Well actually it IS already changing this market...! Even though they have a relatively small team, they're doing amazing steps forward. I'd love to see how much of the total rewards is already distributed among vloggers on the blockchain. I guess these numbers would amaze us!
There will be many applications launched on the Steem blockchain in the future that are going to easily outpace Steemit.com.
Well said, Marly!
Thank you for this article. I think, the technical side of steem is very clear - I agree that it is currently the technically most advanced, safest and most user-friendly crypto currency around.
Looking at steemit, I love the concept and it provides a great use-case for steem. Use-cases are what effectively brings value to a crypto currency.
Upvoting the own account is a double sided sword I think. On the one hand side it gives investors the possibility to get a return on their investment - this is why they buy steem, power up and bring up the price of steem. On the other hand it reduced the reward potential for content producers which have no own money - which is bad for the development of steemit and thus negative for the value of steem.
Over time this problem should decrease however. The inflation of steem will go down, this will reduce the ROI for investors that are their to upvote their own accounts. Flagging - as negative as it is if you receive them - does in my view help as a regulator. However, it should be concentrated on the large accounts which really make a difference as a widespread automated flagging campaign would demotivate the newcomers.
I agree.
I feel that here you discuss about three topics which are:
All of these are important aspects of this ecosystem and all have things to improve. For the difference between Steem and Steemit, I guess the change of the Steemit logo is already a step forward. I also announced everybody that I saw that were not aware of this change, because it helps differentiate these two. One of the people I have updated about this change is (and I am very happy because of it) @davidpakman on his post. After that he changed the logo on all of his new posts where Steemit was involved. Also I am letting everybody know that Steemit is not Steem. I have another problem with Steem being confused to Steam (notice the difference) and this is something what I want to take action in the following days.
The performance of Steem vs other cryptocurrencies is pretty good, and I am sure it can get better with time. Also as you mentioned, with SMTs development, Steem will gain a lot of power which is something really encouraging.
The third aspect (fights over the reward pool) is something which I guess will stop in the future when the inflation rate of Steem will decrease, and people will not have much to fight on. As it is right now, I guess there will be impossible to stop the people greed from doing its stuff...
Thanks for chiming in, Andrew. You're right, I covered a few different things here, but tried to tie them together as best I could because I think they are related. Thanks for reading and thanks for helping to spread the word and educate people.
I should thank you for being an awesome person and helping the community so much! You are an example for people here and I am sure that in time both Steem and Steemit (the community) will improve :D
It's amazing to me that the devs created one of the best cryptocurrencies on the market and a functional social media site on top of it's blockchain.
Most cryptos seems to back projects that are in a perpetual unreleased state with vague announcements that they're "working on it."
I love Steemit and I love STEEM. I dont know if I would have discovered the currency without the platform, but the more I come to understand about crypto and the more I read about STEEM, the more impressed I am.
It should be a top 10 crypto for sure.
Top 10 at least. Sounds good to me.
Yeah, it's so interesting to see all of the Raiblocks hype on Reddit, and then you realize that Steem does all of this and more. Plus it has more transactions per day than any other crypto. So hyped about STEEM. It's a struggle every day for me to prevent myself from going all-in on steem, but... portfolios and balance and risk management and all that...
Edit: OH! And that's not to mention that even as an application, steemit is not the full picture. Just look at SMTs coming up and d.tube and steepshot. Steem is just such an amazing platform.
What are you doing to promote STEEM, separate from the value of Steemit.com?
It's tough - I'm actually taking the opposite approach. Lately when I introduce people to Steemit I tell them: "You will have a lot of questions about the money - where it comes from, how it works, etc - and we'll get to that in a week or two. But its way easier to start by looking at Steemit.com and then to delve into the specifics of the technology later on."
The other approach - to explain Steem from the ground up - has worked, but usually leaves people too confused.
Focusing on steemit the website gets people started by making accounts and posting and meeting people. Focusing on Steem, the token, for a blockchain newbie seems to lead more towards confusion and lack of action.
Overall completely agree and love this post though - this is a great writeup that will help show a bunch of people why Steem IS so much more than Steemit. It may take a while for people to truly grasp the concept, but hopefully sites like Utopian will get the ball rolling in the right direction.
Great point, Matt. When it comes to steemit.com, explaining everything at once can be overwhelming. When it comes to explaining STEEM, Steemit.com can be a distraction.
i agree, most people need a general grasp at first.. show them the ropes and basics and then dive into what is actually going on, this is the best way to NOT scare people away from steemit itself
I agree, I still feel like it's hard to explain it.
Honestly, I still don't understand how anyone makes money upvoting a post after the 30 minutes are up. Do you make money upvoting after 30 min? Or only the curators make money if they vote in those 30 mins?
For votes that happen within 30 minutes (this time will change after Hard Fork 20), a portion of the curation rewards currently (again this may change in the future) go directly to the author. After the 30 minutes, all curation rewards go to the curator. There's a long discussion raised by @blocktrades about this if you're interested.
Sweet, I am interested! I'll see if I can find that...thanks!
Need more infrastructure around Steem itself to help it prosper in terms of utility. Just the basics of building my own Steem paper wallet is a bit of a stretch for me but I can easily do it on Bitcoin (of course I haven't really looked).
I would also argue the fact that there are no gambling sites accepting it is hindering people on really use the free Steem transfers.
Well said, this is principally why I talk about exploiting the power of the steem blockchain. The blockchain has value, steemit. Com is just the first manifestation of how to implement the blockchain, but it think we can do much more than that.
The immense value of the steem blockchain is just unquantifiable, the prospects as just much, we can really do better as you said.
We just have to invest more by powering up and creating more awareness here
Major campaigns on facebook, twitter and instagram on why steemit is the new game
In no distant time, steemit will be king of the crypto space
It's funny to me how your comment reflects the challenges we face. Your profile image uses the STEEM logo but still says Steemit (since that used to be the Steemit logo, that's understandable). Your comment mentions "why steemit is the new game" and "steemit" being the king of crypto (not STEEM).
I'm not faulting you, I'm just pointing it out for us all to be aware. It's so easy to confuse things by describing STEEM and Steemit as the same thing or within the same context.
When I commented earlier I automatically substituted Steemit when I meant to pust Steem. I realized as I was typing that I was doing exactly what you were talking about and corrected it hahaha. I think I need to say it out loud myself, Steemit is not Steem.
We have to say it out loud! How funny is that reality? We all make this slip up regularly, and it's confusing potential investors.
dropping more money into steem does no purpose. All you do is allow others to extract more value from the blockchain.
real value comes from real need. And if there isnt a need for steemit to exist, then the value will never come.
The solution to this is to make people aware that their needs can be met with the steem blockchain. how this can be done is no easy task and one of the things I've been thinking about for a long time.
Something to consider:
If enough people drop enough money into STEEM to give it global name recognition and a massive market cap which brings stability to SBD allowing cryptocurrency world domination, is that not valuable? Could that not change the lives of billions of people who are currently unbanked and controlled by violent governments?
There is a need for STEEM to exist. There may also be a need for Steemit (and similar social media platforms) to exist as existing tools fail, censor, control, and restrict users.
One huge potential solution for the world STEEM could bring would be a blockchain-based UBI. Even Dan Larimer, an anarcho-capitalist, recognized this.
I don't think injecting money into the coin will do any good if the increased value can be simply extracted from another party. You could theoretically vest the money and put it to use, but that's utility isn't it?
I look at it like the back bail out and qe, theistic money at the block chain went change the fact that it needs to have use first.
As for stabaling currency is world economies, I think that the concept is great, but putting it to practice is extraordinary difficult. But it needs to be done and the sooner we can act in it, the better. My only question is what is stopping us from making crypto a real currency?
The answer is stability, and that can only come with steady utility. What do you think?
STEEM has a defined declining inflation rate and a defined distribution of the newly created coins. So the amount that can be 'extracted by someone else' is limited. Even if 100% of the rewards were entirely parasitic and useless from the perspective of adding value (I don't believe this), that would still only only represent about 9% of STEEM's market value this year and that will decline by 1/2 per year for the next 19 years.
Furthermore if you (or other stakeholder voters) really believe that the bulk of the rewards are being wasted, then you can vote for my burn posts which direct rewards instead to be used to buy and burn STEEM, increasing its price and reducing its supply.
I disagree in that I think it only comes from a huge, massive market cap. That's how currencies work. Enough people have to invest in it and believe in it as currency (the utility part is just a mechanism for them to believe this). Think of it this way: all fiat currencies today have the same "utility" technology as paper or coins or even digital balances in a bank account. It's not the utility that gives these different currencies their different purchasing power values. It's control by governments via their own inflationary policies and propaganda. It's essentially what people believe. Many believe the USD is stable (compared to others), so they choose to put their money there giving it a huge market cap which brings stability.
Simply putting money into STEEM could bring about other emergent values which is why I do think valuing it as a currency is important.
I'm confused by your "simply extracted" perspective. Anyone can buy or sell a currency. You can deposit or withdraw.
I think we are both saying the same thing from a different starting point.
Let me establish that by asking, how do we get to that massive market cap? If we look at how the dollar got there, it was through the projects that the US Government initiated to create a need (such as the bretton woods system).
For that market cap to exist, there needs to be products and services that people speculate will succeed. Involuntary injection of money into the blockchain will only yield with people taking advantage of free money, because that is essentially what STEEM does. It creates a rewards pool, and how that rewards pool is dished out, is really up to the stake holders.
In the interest of self preservation, people will often reward themselves before they reward others. So to change that, we will need to create incentives for them to use the coins in different ways. That can only come with establishing products and services based on the coin.
That's the path to a large market cap. Otherwise, how can we get there?
When I mean "extract" I mean if person A injects $X and powers up on the STEEM network. because of supply and demand, the price of steem might go up in that process. But how do we maintain, consistently that value?
One answer is to have such a high valuation of steem, that $X has no real effect. But before we get there, people will constantly try to cash out their portion. The solution to this is again the large market cap. My concern is how we get there.
Yes, steem blockchain adds value to steemit bc it is build upon the technology from the ground up... there is so much more that Dan Larimer is going to do for steemit in the near future, can't wait to see what he has up his sleeve... glad I am here to witness it, is all I have to say
Dan has moved on from Steemit and is focused on EOS full-time.
Well, we are still in good hands here and EOSio will be revolutionary if Dan's over there full-time
Why do I feel like these guys are just doing a quick "copy and paste"?
LOL! If I'm wrong, I do apologize...just thought it was funny.
It's often just noise. Sometimes I'll check to see if they are leaving the same comment elsewhere and if so, post a picture of their comments and flag them.
At least I'm not seeing as many, "Follow for follow! I just followed you! Tee-Hee!!!"
Those folks think this is like Twitter or Instagram, LOL!!!
Write something meaningless and quick many many times and you may get something here and there must be their plan, is my guess ;-)
LOL! Just trips me up, too funny.
Don't foget the self upvote of the follow for follow post.
Haha! Good one! I should probably write a short "Top 5 Annoying things to avoid doing in Steemit"
Haha we've all been there right guys.......guys...... looks nervously around room🙃
Oh yeah, of course. It's what I kept doing myself until I started to learn where that magical fairy steem dust comes from...the reward pool. That's the part that takes a while to understand and wrap your head around.
And I can't honestly say I know what formula is used to determine that...I just know it's there and it should be respected.
This is a spectacular blog post! Happy to make it my 1st resteem. Looking forward to reading more!
Thank you for that honor. Good luck on the new account.
Another out of this world post! Steem is the future! It has so much potential! I'm encouraging my Family, Friends and Clients to purchase some Steem! While it is VERY reasonable! I absolutely love the Steemit Community! It is extremely helpful and kind! It deserves the best karma this World has to offer! The membership numbers for Steemit this year are going to be so PHENOMENAL! @Lukestokes is so AWESOME! Positive Energy! Great Karma! Blessed 2018 my Friends! :)
Hahah... I think you might be the happiest person on Steemit. :)
I am even more so now! Because I voted for you for Witness! Thanks for all your help and your upvotes! They mean more than the world to me! Please keep in touch! Your Friend @extraterrestrial :)
Agreed. I only see Steem as Steemit's coin and most people i know dont even know either exists. I believe the key is as you state, fast transactions and low/zero costs. The problem is that people still thinks its OK to raise the temperature of Iceland to keep doing slow Bitcoin math.
Hahah... nice. :)
Does Steem the cryptocurrency have a usable wallet other than Steemit.com? (Serious question, I don't know the answer, I know there was an app announced at Steemfest II but I've heard nothing about it since).
Edit: Seems busy.org has transfers so yes. However both of those are 'web wallets', which are generally seen as the lowest tier in the crypto space.
Vessel is a desktop wallet
https://github.com/aaroncox/vessel
cli_wallet is a command line wallet that is part of the open source code. It is the only thing I use to manage my STEEM and SBD coins. (I only use the web site for the social platform with the posting key.)
But you're old-school and love command line interfaces. Heheh. :)
Guilty as charged. Vessel was already mentioned when I replied or I would have included it. The question asked about alternatives to web wallets.
With the amount of Steem tokens being generated daily, won’t the crypto currency hyperinflate (more and more tokens begin circulating daily)?
If the supply far outpaced the demand, that would certainly be a concern. As it is now, it seems to be consistent with other cryptocurrency projects out there.
STEEM is not Steemit. Namaste...
Glad you wrote about this. Most of the people investing in Steem only valuate it based on steemit.com. Steemit.com is just one interface/service that is built on Steem. It may be the easiest entry point to Steem blockchain as of now. But over the time we will have better interfaces and the amount of content generated and stored on STeem blockchain coming from Steemit.com will be a small part compared to the content that is being generated from other services. The day that happens the true potential of Steem will become visible to all the investors.
I wrote about this in my post https://steemit.com/steem/@gokulnk/steem-to-the-moon-again. Recently I was discussing with a friend in government about Using blockchains in governance and that is when we realised that Steem already addresses many of those usecases and Steem can be used to empower Governance as it already has governance built into its core. We eneded up quoting from Steem whitepaper more than a couple of times in that single article. That is when I realised the true potential of Steem project.
The DNA of STEEM comes from anarchism which means "without rulers." We can set up systems that are voluntary and govern us without resorting to threats of violence or control. It's a beautiful thing. :)
Yes, the steem logo is much nicer than the steemit logo.
Wait, that wasn't what this post was about?
Logos are like any other valuations.
Highly subjective.
(Granted, I don't know jack about good logo design)
well done
I was quite proud of my graphics design skillz for putting those two logos together like that. Took effort, man. Heheh. :)
I check out Block’tivity every few days and it’s always encouraging. Those pie charts are real eye-openers.
I feel like those of us here now have super valuable information that other folks have no clue about.
Information like that is powerful.
A good message that all need to hear. Seriously I get confused by this as well lol. This is why steemit ended up changing their logo correct? But honestly I still view that other logo with this site just because it has been here longer and when I first started. Gotta break that bad habit
Yeah, I think it was part of the reason. I'm really glad they did it to help us all avoid the confusion going forward.
Vice ico will make steem to the moon!
I never thought about this. Thanks for the clarifications!
This was a great post and should probably be a must-read for newbs. Not that it's entry-level info but more that it contains incredibly useful information that I wish I would have known when I started here.
Thank you, I'm now following you and look forward to keeping up with your work!
Just wait until other smart media tokens are launched and airdropped.
Just wait until there is more functions that require steem to be burnt.
Just wait until not only millions more join steemit but other projects built on the steem blockchain.
Not trying to pump or anything obviously but I feel steem at over $100 will one day become a reality and even then I won't sell because I feel the steem blockchain has so much more to offer than making money.
It's a fun project to be part of, that's for sure. :)
Excellent reminder. At this point, SteemIt is our flagship, but not the fleet!
You summarised the image beautifully. The success of Steem blockchain will be evident when Steemit no more the flagship.
great great article i really enjoyed your article:)
Steem is a lot more valuable than steemit! Dtube and Utopian also add a lot of value to steem!
good post with good info
Thank you for this awesome post. I feel i am being transformed into an erudite from Steemit.
Great post and explanation @lukestokes !! So true , STEEM IS NOT STEEMIT !! Agreed ! Keep up the great work my friend ! upped and resteemed !!👍👍👍😀
I hope as services like DTube, Utopian, etc. start to stand on their own Steem will be considered a cryptocurrency used by multiple platforms, rather then a crypto linked to one platform(SteemIt). When this happens we will see a huge jump. After which I’d hope a major, already existing site, would integrate Steem.
Smart Media Tokens!
True. I am done with reading the white paper and blue paper. Time to finish the SMT whitepaper as well.
Hey @lukestokes
I agree with it, I just hate those upvoting bots, fake accounts, and self-voting because these things are abusing the system.
And I also think Steemit.com is decreasing value of Steem because people help such platform which can be manipulated. Social media can be manipulated.
I was part of site which used to reward writers for the views, likes and shares but there were so many like farms which ruined the system and they shut down the site.
I think Steemit should take necessary precautions to make it a sustainable.
What do you think?
What are some of the "necessary precautions" you have in mind? The value here is generated by the value of STEEM. As long as that token has value, STEEM distribution by the blockchain via front end interfaces like Steemit will continue to distribute value.
It is so much easier to transfer and move Steem around, compared to BTC and Eth. It's almost as if Steemit masks the utility of Steem. Consumers see Steem and automatically think Steemit--social media platform. They don't think of an easy-to-use, scale-able cryptocurrency!
Not to mention that it is inexpensive to use. Have you seen the user and transfer fees for BTC? Ridiculous. BTC's dominance will never last with those fees and delays.
For sure. If more exchanges supported STEEM, I wouldn't use anything else to transfer value to and from them when making trades.
I am curious if there are any particular reasons why Steem it not listing on so many exchanges inspite of being around for so long.
I am on steemit from longtime now but it still amaze me ^,..,^
@lukestokes, what programming do you do? Thank you for the post btw, really good information. The technology behind any crypto is the sole purpose of anything even synthesizing.
Keep Steeming!
I've coded in all kinds of languages over the years from PHP (my main language) to ASP, ColdFusion, Java, JavaScript, SQL, and some other obscure platform-specific languages.
Just so I understand... Steem is the blockchain or the crypto currency not the SBD or steem dollar that you earn form upvotes curations and comments?
I am still learning but I moved to here because it seems to be a great place to break away from everyday social media. I like the Reddit type platform that feels some times depending on the format you look for during a day like Twitter meets Facebook.
Great info though had to follow, upvote and re-steem!
Reblog worthy
@lukestokes Good post. That Steem ≠ Steemit is something we lose sight of on occasion. Your post raises a question, in my mind. Are you seeing steem being utilized much outside of the Steemit/Busy/Dtube ecosystem? I am not. In any event, what areas do you see Steem evolving into? Smart Media Tokens, etc.? Where else?
SMTs for sure, but I'm a huge, huge fan of cryptocurrency in general. I see massive, global need for us as a species to get away from violence-backed fiat currency. From there is't a matter of figuring out which cryptocurrency is the best form of money (i.e which one is the best ledger). To me, from a technical perspective, STEEM is very high on that list right now, regardless of the other use cases for it in terms of a utility app token.
"To me, from a technical perspective, STEEM is very high on that list right now," can you elaborate a little more on this and share the reasons?