The Satoshi Cycle says that as there is an increased interest in bitcoin, the price tends to increase, and as the price increases interest tends to increase further.

(Try saying that 10 times fast!)

The net effect is that prices continue to get pushed higher and higher as the cycle creates a compounding effect that tends to feed on itself which further propels prices skyward.

This theory is somewhat supported by the strong correlation between google searches and the price of bitcoin.

Check out the chart here:

As you can see, prices and search trends have a very strong correlation.

This is sort of one of those "chicken or the egg" debates.

Is the increased google searches causing the price to increase or is the increased price causing people to search for it more on google?

Probably a combination of the two, though it takes one of those two things to happen first in order to get things set in motion.

This kind of goes along with my post from the other day talking about the network effect and metcalfe's law, and how that relates to bitcoin and possibly steem as well.

It can be seen here:

https://steemit.com/steem/@jrcornel/the-price-of-steem-should-currently-be-trading-at-usd2-22-and-here-s-why

Could this sort of thing also apply to steem and steemit.com?

The interesting thing about the satoshi cycle is that the same exact thing can probably be said about steem and steemit.com. As the price goes up, the rate of growth likely accelerates on steemit.com. As the price falters or goes down, the rate of growth likely slows down as well.

(I probably should graph that at some point here and see how close my assumptions really are)

This means (at least in theory) that if we could keep the price going up, the growth would in turn pick up which would likely cause the price to go up further which would in turn cause the growth to pick up even more etc etc etc. 

Do you see where I am going with this?

There could be a compounding effect that launches the price of steem and the number of users of steemit.com into the stratosphere!

Can this actually happen?

Surprisingly (or not surprisingly), it could probably happen fairly easily.

Remember, it doesn't have to be the price going up first which causes users to show up, it can happen the other way around too, where users show up first and then the price follows etc etc etc.

This could happen by a couple large influencers showing up to what we already have currently and bringing their followers along with them, which would cause an explosion of new users over night which would likely get this whole snowball set in motion.

Another possibility could be from what we have already been told is coming.

Development and promotion of the site.

As the development takes off, the signup process is dialed in, and some marketing/promotion of the site takes place, things could really start to pick up on here.

Then, as all the new users showing up starts to help the price of steem increase, more and more users likely flock to the site because of the increasing price, thus creating that compounding effect we are looking for. 

This kind of phenomenon could feed on itself as it takes the price and website to massive numbers.

Keep in mind that none of this is even including what could happen with SMTs.

All of the above is just taking into account strictly the steemit.com website, the network effect, metfalfe's law, the snowball effect, and the satoshi cycle all playing out in front of our eyes.

The SMT launch could cause the same type of thing, but just with a different catalyst. The price could start going up first which in turn would attract new users etc etc etc.

The key with all of this is that we just have to get to that point, which the developers say is coming, and the rest kind of takes care of itself as it feeds on itself.

If that is the case, 2018 should be a very exciting time to be holding steem and to be on the steemit.com website.

Stay informed my friends.

Sources:

https://cointelegraph.com/news/will-etf-become-bitcoins-holy-grail

https://cointelegraph.com/news/satoshi-cycle-interest-in-bitcoin-raises-price-which-raises-interest

Image Sources:

https://cointelegraph.com/news/satoshi-cycle-interest-in-bitcoin-raises-price-which-raises-interest

https://immersioninenglish.wordpress.com/2015/12/12/57-idiom-snowball-effect/

Follow me: @jrcornel