Opportunity and Importance of Fiat Gateways for Steem
Last week, the Steemit blog had an AMA with the Huobi exchange group that recently started to list Steem with their United States counterpart based out of San Francisco. Our great ambassadors on in the community incentivized everyone to engage with them and asked the questions we wanted to be answered. My main question was whether or not it would be possible to lists team against the US Dollar instead of only other cryptocurrencies. They current listed Steem against Tether, Bitcoin and Ether. However, given the popularity of using Fiat in South Korea, I thought it would be interesting to see their interest in setting up a Fiat currency gateway. I was pleasantly surprised when they answered that it would be something that they could explore if there was enough demand for it!
I have always thought that one of the limitations that Steem has regarding its demand is the fact that there is a lack of fiat gateways to buy in and out of positions. Particularly, given the investor and developer community which needs to "pay their bills“ mostly in fiat. While they mainly earn in Steem on the platform, there needs to be a better way to use their earnings outside of the ecosystem in order for it to be more sustainable. While this is not the case for me as I am tend to build and hold the portfolio for time, others need to prepare for their funding realities as we have learned from a number of projects including Steemit Inc. Despite my seamless experiences with @blocktrades, a direct Fiat currency to Steem exchange has other benefits. For example, the accounting for tax basis has always been complicated when exchanging between cryptocurrencies. A Fiat gateway would reduce the administrative burden for these processes. it will also reduce both security and technical burdens for those hesitant to go through the process of crypto exchanges just to get to an exchange for Steem. This is why I believe that having an opening in fiat based in US dollars would be a huge opportunity to improve the liquidity of the Steem token.
As I did a bit of research I was surprised to see that about 45% of the volume of trades comes from Fiat on exchanges that have the pairing available. This is mainly the South Korean Won that some exchanges have listed. I think this in itself demonstrates the interest in having a Fiat pair for steam. In addition, about 12% of volume uses Tether as a pair. So, in essence, over 50% of volume is related to a fiat currency one way or another. I am not sure how that compares to other altcoins but ETH and EOS both have about 44% trading against Tether as a small comparison. Interesting that this pair does not trade at any material discount or premium to other which is good as the liquidity is sound from a volume perspective.
I thought this would be a great opportunity to get the Twitter Hustler crew and others here busy on trying to get this trending here and on Crypto Twitter. I hope @nathanmars, @theycallmedan, @socky, @coingecko and @jongolson don’t mind the mentions but this would be great to have some visibility on as it presents and opportunity to demonstrate the capabilities of our community as we have in the past. We have tried with Bittrex and Coinbase in the past but this seems to be a great extension given the prior interest @huobius has had with our ecosystem and the reality is that we should support those that support our ecosystem as well! What are your thoughts on getting a USD or other Fiat trading pair and the opportunity it present? Let me know your thoughts in the comments below!
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I think a USD pairing with STEEM would be huge. I think having to convert between multiple currencies/tokens is a big deterrent for many people. Luckily the fees to convert tend to be pretty low. Still it can be a hassle for individuals, especially those new to crypto. Maybe it's just me but the exchanges can be a bit overwhelming when first getting involved in crypto as is switching value into satoshi's rather than USD. It even more confusing when you have to make multiple trades to buy the currency you want. Again, it could just be me but I think many new users would feel the same. A USD pairing would reduce that at least a little
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Agree! It certainly is for me. I could totally transfer from BTC, but just haven’t had too much desire to thus far. However, if it was a straightforward USD/STEEM pair, I’d probably find myself investing!
Certainly would improve the process for many as the concept of public and private keys that use encryption are new to so many that it becomes barrier to entry in my opinion.
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In my opinion STEEM listing with fiat or USD is a good idea because there are many people are joining steem blockchain everyday. I believe many of them are not crytpo holders and even there is a possibility that many are not technical enough to perform such transactions using cryptocurrencies. First of all buying anything using fiat is very easy ans simple so it applies to steem as well. If fiat option is provided then certainly its going to help many people. They won't have to buy other cryptocurrency first then exchange ir against steem.
Nice thought @newageinv liked this post.
Posted using Partiko Android
Yes, for those using Steem as a way to supplement their income, it would be a great step forward until more merchants adopt Steem as an acceptable payment.
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Man I have got to speak the truth here. I think the steem community is a bit afraid of the fiat gateways.
I have raised this question of 'why don't we have more fiat gateways?' to several senior members over the course of last year only to be disappointed. ( I have talked to these people in person and online).
All these guys keep saying that it is not a priority at the moment.... for me this couldn't be further from the truth. I have come to understand that a lot of people here think that the community would simply start withdrawing if more fiat gateways were to be made available.
To me this indicates a lack of confidence of these individuals in the community and the Steem ecosystem at large. Frankly speaking the lack of fiat gateways is hurting us in the sense that it creates a fear in the newbies that they cannot withdraw easily.
For a newbie the question might not actually be about 'withdrawing the funds' but rather the fact that they feel a lack of control over their money. I am pretty sure that lack of fiat gateways is one of those things that is holding us back.
The outdated thinking of the 'old guard' in disregard of this fact might be working against Steem.
PS: I am hoping to write an in depth post about it and your post is an excellent starting point for me. Thanks!
This is true but the investment thesis is that the supply will meet the demand of those trying to acquire it for the reasons there are. People wanting to cash out will do it either way bow as well. I believe that the addition of liquidity could attract more proce discovery to properly value the asset.
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Let’s create more demand for
And we’ll have all the Fait pairs :)
Agreed! It has already started as we expand the knowledge of our ecosystem around the world! Thanks for your hustle!
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Steem is currently trading at roughly $3 - $4 million USD in daily Volume. Which is not really that bad in the bear market.
We've held the opinion that the value of Steem is in the Community and users on the platform and Dapps. A fiat on ramp would certainly help.
Thanks for the comment! It feels as it has been improving as well as the market has responded well since the adjustments made by Steemit Inc as more collaboration has started to take place with the community and developers.
Posted using Partiko iOS
Great suggestion and thesis, as this blockchain gains in popularity, and all the development taking place, we will get some fiat pairs soon.
I would hope so as long as regulation does bot get worst.
Posted using Partiko iOS
Great post.
I believe by us working together, we can lift steem more higher
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