RE: Should we establish a long-term cap for Steem supply?
Great article and I'm flattered I'm quoted so much here because I know nothing (Jon Snow levels of nothingness). Your arguments are perfectly ok but you still dismiss or I would say undervalue the psychological/fundamental aspect.
Bitcoin is inflationary yes, however, there's an upper limit, it can't be mined forever. It doesn't matter if there's 16 or 20 millions for sale, like gold it's scarce and unique, that alone has value as long as it works. Many BTC were lost over the time too and will be lost in the future too.
Steem is the single point of failure in Steemit platform, it doesn't have a cap or upper limit as you mentioned and anyone knows it's highly inflationary, that by this time next year it will double its supply. Liquidity is scarce yes, but the incentive for the speculator or trader (who won't even use Steemit) is not there in the long term. And those are the only ones supporting the price right now. Unless they get a clear economic projection for the future, the market will continue to fall.
To me it all points to a very poor long term investment decision, that is to buy Steem and turn it into Steem Power. On top of a highly inflationary currency you are also choosing to lock it down for 2 years. Yes it's safe from inflation (not 100% though...) but only if you don't power down. So again, what's the clear incentive to turn BTC, fiat or any other cryptocurrency and turn it into Steem or SP?
I undervalue the psychological aspect??
My intention was quite the opposite - to stress its importance.
Steem is not meant to be an investment asset. Steem Power is the investment asset in our case.
The incentive is the same as in Bitcoin's case - that in the future there will be someone willing to buy it from you at a higher price.
For me, the lock down period of 2 years is good: I invest long term anyway (so I'd keep Steem long term even if there was no lock) and it protects me from sudden devaluation. Indeed, it's not an interesting offer for short-term speculators.
I understand that you remarked its importance but if you invested in it long term basically means you undervalue these psychological and fundamental aspects. You don't invest in something because you and you alone believe it will go up, you invest in something based on an holistic analysis of how the crowd, investors and speculators will react in the future. Then you can take a look at the technical analysis and see what's a good price to get in.
But as I stated many times, the problem is in its fundamental analysis, Steem or SP it's not supported by anything that says the value will appreciate in the near or long term future.
Agreed. But please note that this^ refers to all crypto-currencies in existence, including Bitcoin and Ethereum. I bet on Steem because for me it has the biggest chance to go mainstream.
I don't agree with BTC and ETH (potential for appreciating both in the near and long term is there). However I do agree that Steemit (due to its social media nature) has the most adoption potential of them all (not Steem though...).