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Steem: Long-Term Potential Worth the Risk?

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Steem is one of the three currencies created by the Steemit platform and it presents an interesting investment opportunity.

While leisurely perusing the Steemit whitepaper, I started seeing something valuable in Steem, despite some extensive downward pressure.

Now, this article isn’t to be taken as investment advice for any short-term or long-term gain, but it will help present a few of the thoughts I had when reviewing this token.

The Problem:

In order to understand Steem, it’s useful we dive into the Steemit platform and the overall problem Steemit is looking to solve.

The battle for attention:

More than two million blog posts are written and published EVERY DAY, and each has to find a way to break through the noise. Many content creators utilize some sort of combination of owning their own platform (ie. www.alexmoskov.me), guest posting or being a contributor on various other sites.

The onus of content distribution falls on the content creator, and many content creators end up finding that content distribution can take more time and effort than the creation of content itself. Then, you’ve got content creators who operate at a much larger scale and are capable of creating much bigger impressions through the use of different marketing strategies.

This means that the content you see on a daily basis isn’t necessarily the best, but it might be the best marketed.

The Steemit platform helps alleviate this problem by rewarding content curators. People who upvote and comment on posts get rewarded. The more Steem Power Units curators have, the more their vote will count, the more influence they will have, and the more they will get paid as well.

The battle for monetization:

Unsurprisingly, The current content dilemma circles around money. The Internet has provided virtually anyone a platform to voice their opinions and ideas.

The digital environment has given multi-million dollar media companies a new outlet, and content creation has developed into a full-time job for many individuals.

The problem with content is how content is monetized. The most viable ways to get paid for content for many media companies and individuals are either through advertising, affiliate marketing, or some sort of payroll.

Creating unbiased content often comes at the expensive of the content creator. The audience expects high-quality stuff but isn’t so keen to pay for it.

The Steemit platform offers a solution by directly rewarding content creators for their content. If a piece of content is genuinely popular and valuable, the writer ends up being compensated. This money comes not from the audience, but from the Steemit network itself.

Steemit: the Solution the Content World Needs

Steemit is an extremely interesting solution. Here are a few quick hits of what you need to know.

Steemit has three different currencies:

Steem: The currency that can be bought and sold on most open markets. This is how most people using the Steemit platform “cash out”. Steem currently “erodes” at an annual rate of 9.5% every year due to the production of new Steem.

Steem Power Units: Steem Power Units (SP) are a more long-term offering. When you buy SP, you’re locked into it for 2 years. This limit is meant to keep people invested in the platform long-term and stop people from suddenly dumping their units on the market. Holding SP entitles the owner to a proportionate ownership share in the network. 90% of all the new Steem made every day goes to people holding SP. Additionally, half of what content creators receive when paid out per post is in SP.

Holders of SP receive a higher weight to their upvotes, helping users to build up more of an authority and influence on the site.

Steem Dollars: Steem Dollars are pegged to the U.S. Dollar and are a bit more stable. 50% of the compensation comes in Steem Dollars. Holders of Steem Dollars are able to do one of three options:

  1. Convert them into Steem and sell them on the open market.
  2. Hold them and essentially earn 10% interest when compared to Steem.
  3. Exchange Steem Dollars for SP and hold for the long term.

There’s a lot to Steem and the Steemit platform, but many of the intricacies fall beyond the scope of this article. I recommend learning more about Steemit and the role Steem plays in detail (the whitepaper is a great source).

The Opportunity

So, one of the biggest questions I had is “why would anyone hold Steem if it’s got downward pressure of at least 9.5% every year?

Well, my bet is on the opportunity outside of just market forces surrounding Steem. The Steemit platform is far from nearing how big it could potentially be, and it’s got a few big ingredients working in its favor:

  • Building an engaged community. The Steemit platform is doing an awesome job of not only incentivizing engagement through monetary compensation, it’s also started to attract a highly engaged and loyal community (much like Reddit and 4chan).
  • The call for influencers is appealing. Soon enough, influencers with large audiences will see the value of being on the Steemit platform by holding Steem Power Units. It seems like very few influencers (even in the slightly esoteric crypto crowds) are currently making use of this.
  • Lethal engine for growth. Users of Steemit are best incentivized to refer their friends to their site and link to their articles. The onboarding of Steemit has some serious potential.
  • Steem’s not even close to its previous ATH. Steem was hovering around $4.00 momentarily in July 2016, and only started to slowly pick back up in May 2017.  
  • Establishing an audience and building the Steemit platform go hand in hand. Many content owners can find a home in Steemit and are able to invest in the platform to have more influence when it comes to voting or reaching consensus.
  • Steem Power Units. While SP is locked in for 2 years, holders get to enjoy some pretty substantial benefits such as accumulating extra SP every day.

Final Thoughts

While I can’t and won’t make any predictions on price, I think the evidence supporting the Steemit platform is hard to overlook.

If I were to surmise a prediction, I could see Steem Power Units being a practical investment for content creators (or any other digital marketing talent) looking to explore a new avenue for their content.

A few words of caution before we close this out: Steem has the tendency to be fairly volatile. It’s been around for awhile (relative to other cryptocurrencies) and experienced a pretty sharp drop from $4.34 to $0.102 a few weeks in 2016. It has seen a decent lift starting May 2017, but this could simply be due to the general rise in most cryptocurrency prices. Additionally, the downward pressure of 9.5% can be a tough pill to swallow.

Finding a way to capitalize on the potential of the Steemit platform and the current Steem prices could be incredibly lucrative.

Disclaimer: Author has no investment stake in Steem.

Featured image courtesy of Shutterstock. 

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.5 stars on average, based on 17 rated postsAlex Moskov is a writer and entrepreneur with a passion for building and creating awesome things. Alex has experience in music tech startups, digital marketing, and cryptocurrency investing.




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EOS Plunges 18% En Route to Two Month Low

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A sudden downturn in the early hours of this morning has wiped out much of the slow gains made in the last few days. The entire market has sunk to levels far below that of the dip on June 9th, and EOS is now priced at a level not seen since early April.

From a high of $10.49 earlier in the morning, EOS plunged to $8.59 just a few hours ago. A slight rebound has seen it rise back up to $8.67, but that still marks 17% losses over 24 hours.

EOS has been hit the hardest out of all the coins in the market cap Top-20 today. This mirrors the short period of growth around a week ago as the market recovered from the June 9th dip. EOS recorded close to 20% gains that week, and now that same balance has been rescinded.

This sends EOS back to its early April price – right before the EOS token sparked a major bull run and went from $8.49 to $22.52 within the space of three weeks.

EOS is not alone in its reversion to pre-April levels. Ethereum has shown the same movements, while Bitcoin has sunk to a price not seen since October of 2017.

The majority of trades over the last day have come from Huobi and OKEx, with EOS/USDT trades making up the vast majority of the movement. Meanwhile, on the Zebpay exchange, where $0.25 million worth of trades have taken place, the price of one EOS token currently stands at $8.43.

Mainnet, Block Producers,Token Swap

EOS has had a busy month, with a mainnet launch; a stalled block producer vote; and a whole host of airdrops launched from its platform in between.

Industry pundits will no doubt succumb to the temptation to speculate, but when so many red candles appear across the board within the space of a few hours, the only thing left to do is throw your hands in the air and admit defeat.

News, whether fake or real will probably surface in the next few hours which explains away the reason for the sudden market-wide crash; but how much of it is to be trusted, and how much of it is the manipulative propaganda of whoever is moving the market, for whatever means?

Bithtumb $30 Million Hack

The Bitthumb hack of a few days ago is taking prominence in the headlines at the moment, but there was a significant delay between the $30 million being stolen from the exchange, and the downward reaction of the market that we saw this morning.

News of exchange hacks, irregularities, or merely ominous announcements have consistently had a negative effect on the market in the past. However, there is a growing community online who view such news as useful camouflage for the people who are really pushing the prices. However intriguing that may be, it only leads to further speculation at this point.

Featured image courtesy of Shutterstock. 

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.5 stars on average, based on 12 rated postsGreg Thomson is a full-time crypto writer and digital nomad. He eats ICOs for breakfast and bleeds altcoins. Wherever he lays his public key is his home.




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Selloff Resumes: Cryptocurrency Market Heads for Weekly Loss After Friday Tumult

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Cryptocurrency prices fell hard on Friday, with EOS hitting its lowest level in 60 days as bear-market pressures re-emerged following days of stable trading ranges.

Coins See Red

Cryptocurrency prices were down across the board, with major altcoins like EOS and Ethereum falling double digits percentage-wise. EOS reached a session low of $9.30, its worst reading in two months, following a botched mainnet launch that has yet to be resolved.

Ethereum prices are down more than 10% at $477. Ether bottomed around $468 earlier.

Bitcoin is currently testing four-month lows after being rejected several times at $6,800, a key inflection point for the digital currency. As Hacked reported Thursday, bitcoin’s rejection at that level was a strong sign that the recovery was losing steam. BTC/USD reached a low of around 6,092.38 on Friday, according to CoinMarketCap.

Bitcoin was last down more than 7% at 6,210.

Nearly every coin ranked in the top-100 by market cap was down compared with 24 hours ago, with the only exception being Game.com, a lesser-known altcoin.

The cryptocurrency market cap plunged by more than $30 billion to $257 billion. It had spent most of the week above $285 billion. Total trade volumes have averaged $14.1 billion over the last 24 hours.

Bearish Cycle Continues

While there was no immediate catalyst for the Friday selloff, the pullback is likely a continuation of the bearish cycle that re-emerged last month. The market has formed a new bottom in the wake of last week’s $60 billion selloff, a sign that bearish pressure is likely to remain.

Contrary to some reports, the recent cyber attack on Bithumb is not the cause of the recent price shakeup. Although the market dipped initially following reports of the breach, it recovered just as quickly and continued higher.

That said, the attack did catch the attention of financial watchdogs across the Asia Pacific region. On Friday, Japan’s financial regulator
ordered several digital currency exchanges to improve their anti-money laundering practices.

The order from Japan’s Financial Services Agency (FSA) led bitFlyer, the country’s largest crypto exchange, to suspend the creation of new accounts as it beefed up its standards.

South Korea’s financial regulators have also stated they will expedite the creation of new cryptocurrency laws following the recent attack. According to various reports, new legislation could be on its way in a matter of months.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.6 stars on average, based on 462 rated postsSam Bourgi is Chief Editor to Hacked.com, where he specializes in cryptocurrency, economics and the broader financial markets. Sam has nearly eight years of progressive experience as an analyst, writer and financial market commentator where he has contributed to the world's foremost newscasts.




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Stellar Lumens Update: Acquisitions and Retirement Accounts

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Stellar Lumens is in the headlines this week amid reports that it is negotiating to acquire a high-profile startup by the name of Chain. Meanwhile, a bitcoin IRA that lets users buy cryptocurrency for retirement added XLM to its list of available assets, potentially raising the investment appeal of the Stellar protocol.

Stellar Eyes Chain Acquisition

Fortune reported Wednesday that Stellar has been in talks to buy the San Francisco-based blockchain startup for $500 million. Citing anonymous sources, the report said the payment would be made in XLM, the seventh-largest cryptocurrency by market capitalization. No cash or equity will be part of the sale, which has yet to be finalized.

Although Stellar’s plan for Chain is not yet known, its interest in the startup is tied to its team of talented blockchain developers. Stellar founder and crypto trailblazer Jed McCaleb has a keen eye for talent, having founded Mt. Gox, eDonkey and Ripple XRP.

Chain develops enterprise-grade blockchain solutions, including ledger products that allow businesses to transfer funds in token format. The company raised over $43 million in venture funding from high-profile investors including Visa, Nasdaq, Citi Ventures and Blockchain Capital.

It is not entirely clear how the purchase would impact XLM’s market value. For current investors, the main concern is a wholesale dump of Lumens by Chain’s backers in the event that the sale actually takes place.

At a current price-per-coin of less than $0.23, the Chain acquisition would translate to roughly 219.3 million XLM. There are roughly 18.7 billion Lumens in circulation, giving the currency a total market cap of $4.3 billion.

Stellar for Retirement

The BitcoinIRA retirement platform has announced the addition of both Stellar Lumens and Zcash to its available list of cryptocurrencies, giving investors the ability to diversify their crypto holdings for retirement.

“[W]e’re excited to meet the high demand for both Stellar Lumens and Zcash in the marketplace by making these coins available to customers looking to diversify their retirement portfolios,” said Chris Kline, BitcoinIRA’s Chief Operating Officer.

In addition to Lumens and Zcash, the BitcoinIRA platform allows retirement planners to access bitcoin, Ethereum, Ripple, Litecoin, bitcoin cash and Ethereum Classic.

Crypto IRAs fall under a much broader category of assets called digital IRAs, which are self-directed retirement accounts. Cryptocurrencies are recognized by the IRS as property, which allows for their inclusion in retirement accounts. Self-directed IRAs have unique tax benefits that can help investors maximize their digital currency holdings.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.6 stars on average, based on 462 rated postsSam Bourgi is Chief Editor to Hacked.com, where he specializes in cryptocurrency, economics and the broader financial markets. Sam has nearly eight years of progressive experience as an analyst, writer and financial market commentator where he has contributed to the world's foremost newscasts.




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