STEEM: The Leading Blockchain Out Of The Gate? I Think So...And It Isn't Even Close: And It Might Get Further Ahead
Okay, I have to admit that I might be biased in my conclusion although the evidence does seem to support this.
I read an article last night that detailed how the author thought that blockchain innovation was being stifled. This person's conclusion was based upon the fact that the fees for both the Bitcoin and Ethereum blockchains has skyrocketed of late. What this does is make many apps useless since the fees deter people from using them. A central premise for microprocessing is obviously limited-to-no fees. We do not see this on those blockchains.
Now I am not certain that I agree with this premise entirely since I view it as a temporary situation. My personal feeling is that the Bitcoin and Ethereum people will figure it out. It might take them a while but there are simply too many highly intelligent developers working on those blockchains.
So why do I say that Steem is leading out of the gate? Is it because it has more transactions than on average than anyone else? Or could it be the fact that development is occurring on this blockchain at such a rapid rate? Maybe it is the applications that are being created on here?
It is none of those answers although they are valid. The number of transactions show this is already a thriving blockchain with more activity than any other one. That gives a lot of validity to what is taking place. As for the development, Bitcoin still has more developers than any other blockchain. At the same time, because of all the tokens created, Ethereum is in the lead in the app arena, at least in terms of number created.
The reason why Steem is ahead of all others, and could remain there, is fees and scaling.
This is at the core of the issues that the other blockchains are facing.
So if you’re trying to build anything even remotely high-volume atop an Ethereum token — forget it. Your entire business model is catastrophically doomed at today’s prices.
As a result, entire categories of cryptocurrency experimentation and innovation are on hold until the bubble bursts, or until / unless Ethereum finds a way to scale such that transaction fees plummet. Oh, people can still write and deploy code. But nobody will use it. Curious would-be users will be repelled by the nontrivial expense of mere experimentation, never mind ongoing usage.
We all know that both Bitcoin and Ethereum are bogged down with the traffic. What is ironic is they are both in this state while charging high fees. So obviously, most people are not turned away at the moment. Why would that be? Perhaps it is because of a lack of choice. These two blockchains had so much development early on that they became the de facto networks. Hence, the people in Venezuela are using Bitcoin in spite of the high fees simply because there isn't a viable, wide-spread alternative.
For the state of the blockchains pertaining to usage:
As you can see, Steem is blasting out 1.3M transactions a day and not even breaking a sweat. For the foreseeable future, there is not a scaling problem. This gives it a huge advantage over the other blockchains who really have to determine how they are going to get rid of the bottlenecks. While I believe they will accomplish this, it will take them some time. All the while, Steem is steaming ahead.
It remains an open question whether even much, much lower fees would be viable in the long run. Proponents of micropayments don’t seem to realize that the fundamental problem with micropayments is not their cost, or the absence of supporting infrastructure; it’s the cognitive load that they induce. Parker Thompson of AngelList argues that fee-free decentralized apps are the only ones which might possibly succeed in consumer markets, and I think he’s right, but that raises the question of how you prioritize and prevent spam blockchain transactions in the absence of fees.
This brings up the major point of contention the author had which is very valid. How will these systems handle the fee structure? Will people be willing to make a payment on a small transaction. Consider some of the upvotes on Steemit that are only worth a few cents. This has a payout of .005 SP or so. How would you like to earn that except it costs 25 cents to send the money to you? Imagine having your account deducted to pay the transaction fees.
Fortunately, this is not a problem on the Steem blockchain since it is a fee-free system. All transactions cost zero (bandwidth is the only thing that is required). Contrast that with the other two blockchains and, even, Litecoin which promotes itself as low-fee. Low-fee is not no-fee. Simply put, there is no contest.
Let me post a piece of that again:
Parker Thompson of AngelList argues that fee-free decentralized apps are the only ones which might possibly succeed in consumer markets,...
This might be the exact reason why Steem will keep separating itself from the other blockchains over the next few years. While the other networks are focusing upon scaling up and getting their fees down, Steem simply offers a viable alternative to developers. If you are creating an app that you hope to go mainstream, as is stated here, the greatest chance of success is to be fee-free. The way I see it, developers are rather limited in their choice of blockchain if this is a necessary criteria.
For full story:
https://techcrunch.com/2018/01/07/the-cryptocurrency-bubble-is-strangling-innovation/
@arcange issues his daily report detailing the numbers on the Steem blockchain. The graph I like to watch is this one.
We hit 60,000 daily active users plus 30,000 authors. That is an impressive growth rate. Of course, this only verifies what the daily transactions already confirm. However, in my view, it takes it one step further showing the activity is widespread. This is not a situation where a few people are doing many transactions. There are now 60,000 people engaging upon activity on this blockchain, a number that I expect to keep growing.
For his full report:
https://steemit.com/statistics/@arcange/steemit-statistics-20180108-en
So in short, Steem has:
-Zero transaction fees
-1.3M transactions per day with the ability to handle millions more
-60K users and growing
-30K authors posting articles
-An increasing standing in the search engines (organic traffic)
-A rising token price which increase the payouts in the reward pool (in dollars at least)
All this without a major application added, communities implemented, HF 20 taking place, or SMT being operational. Can you imagine what this place will look like when all that is put into place?
Steem is quickly putting itself at the forefront as one of the leading blockchains. In addition, while it is impossible to predict the future exactly, I am making the case that it is possible for Steem to keep advancing ahead of the other ones. The fact that there it is fee-free for transactions gives Steem an advantage that others cannot get around. This has to hold a lot of attractiveness to developers.
How will this play out? Ultimately, I am guessing to the benefit of Steemians.
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The fee-free transactions in steemit is going to be the best alternative ever.
It is hard to beat @edith4angelseu.
I cannot see the other blockchains being able to match that.
Also instant-ish txs. It's amazing how much better steem is than the alternatives. Just think about how freaking crazy EOS is going to be.
Indeed you hit the nail on its head on this one and @ashleykalila indeed is right that you have a way of explaining tech matters in words non tech humans like me can understand haha!
We saw that last December when prices of BTC skyrocketed but so did the transaction fees. It got so terrible that just to emphasize a point sending 1 pesos value of Bitcoin would have a transaction fee of 500 pesos. Sure the bigger amount would reduce the cost in terms of ratio but coupled with the bogged down of transactions and it took several days and even weeks if you used the lowest transaction speed because fees are lower. You want fast they you gotta pay almost 10 times!
Etheruem had the same problem Crypto kitties flooding their system to the utter dismay of other users who were not playing teh game. Imagine if your merchant system was not able to process anything because teh blockchain was being hijacked by kitties! Well it was a bid for their start of worldwide Kitty domination!!! Haha
Yet Steemit kept on going is still developing lots of uses to it and doubled it active users!
I can see a Planet Steem where in we earn, purchase goods and services and live our lives through Steemit!
I may not be an early adopter of Steemit but I am here for teh long run. Keep getting SBD and Steempower, powering up and holding my account.
I will be one of the First Filipino Steemit millionaires who did it with working hard and being creative.
I can see that too....I envision this a self-contained ecosystem where the apps people develop on here fill most of the needs that people have. Of course, they will still have bills to pay but a lot of what is purchased online will be in a STEEM store (more like many of them).
By the way, you are here now...that makes you an early adopter....the masses are just starting to get wind of this...it will be a while before they get here in force.
Down the road, 500 SP will see like an enormous amount.
Steem is revolutionary plain and simple. It is going to change the world, and play a big part in the blockchain revolution to tackle the problem of greedy banksters. Although greed is around on Steem those people who believe in the platform as a cash cow or get rich quick scheme are quickly becoming the slim minority. It is undeniable to see that Steem is the best blockchain out there, people who are in denial will open their eyes soon enough. People who still believe bitcoin is all there is and that bitcoin dictates the market will be proven wrong as Steem continues to rise. Keep up the interest, rich, and thought-provoking content. Hopefully, manna will be just as successful as Steem.
Hard to fault some of the masses @notoriousrebel.
They are fed a line of garbage by the conditioning mechanism. It takes a lot to break out of that.
That is why I personally believe that all the promotion that people are doing on the likes of Youtube and FB isnt really having a great impact. People do not believe it.
Instead, the best advertising, and what I believe is working is when one Steemian is making some money and tells everyone he or she knows. This is really what attracts the attention.
Over time, word will get out...that is why I am enjoying the sweet spot we are presently in. Down the road, SP will be harder to come by.
True that last December some of us did our first payout and after seeing it we had so many people asking us how did we do it.
From 10 people we are now a group of 100! The power of word of mouth is very compelling.
Yes I totally agree with you the only bottleneck on Steem has been the account creation issue. But now we have many possibilities to open an account you can even purchase now with creditcard a Steemit Account. But it costs 45,-$
You can buy an account on blocktrades for crypto too.
Well, when Steem has the advantage now and will lose it later when they eventually fix things, then it should be cruising now as to stabilize later on.
Since it is in the shadow of all the other coins now that it has the advantage, it isn't its performance giving it the edge, but its ecosystem, features and the fact that it is working and doing stuff, something many other coins can't claim.
Thanks for the comment @spiritualmax.
Hard to equal the community that is forming here. That is something that is an ace in the hole for STEEM. The people who are on here and active are all in. It is this commitment which will ensure it survives. How it compares to other blockchains....that remains to be seen. But rest assured, it will propel itself into the top 10.
Exactly! Steem is much better than anything else, because it doesn't have fees. There is absolutely no reason why steemit can't overtake all the cryptos in terms of popularity and usage. This year we are going to see the popularity of steem skyrocket! And obviously, the price will go higher as popularity increases :)
Damn @trendo. Your comments make me feel almost bearish about STEEM. 😁
I look at this thing from so many different angles and it always leads me to the same area...that steem is one of the better blockchains and has a window of opportunity to thrust itself to the forefront of all blockchains.
People are continually looking at the microprocessor market yet overlooking STEEM. We see .001 STEEM sent on a regular basis on here...try that on BTC or ETH networks.
Haha, that's awesome! Yeah, I also tried looking at steem from many angles and there's just no denying the fact that steem's technology is probably the best out there so far!
Indeed you wouldn't be able to do that with BTC or ETH...
BTS looks really interesting too...I am glad I own that one also.
As I commented elsewhere, it is hard to beat the steemit community. There are probably 35000 users on here who are uber dedicated....this number of passionate seems to be growing also.
It will be amazing when 500 SP is a large amount...I dont think that is too far down the road either.
Yeah, the community is fantastic and it's filled with passionate and dedicated users.
I agree, it's definitely not too far away. By the end of the year we are going to see a lot happening here :)
I think Steem is the best token going right now. It needs broader adoption but it makes a perfect general commerce coin. Add to that the whole ecosystem and it blows the competition away.
I can't wait for SMTs!
I don't have your faith in the bitcoin devs. I think that the problem with bitcoin lies in a conflict of interest. Btc mining is almost centralized these days. Miners benefit from higher fees.
Eth is a different matter I feel. I think the problems there stem from design flaws.
Steem is immune to both of these problems. :-)
My biggest concerns with Eth and Btc are those voiced by the article author but also the negative light these networks cast on other blockchains.
I do have faith though that within a year we will see increased adoption of Steem that will ease exchange to fiat for many people. Steem is much more than money, but all the same, it makes a damned good currency.
Thanks for the post.
Keep Steeming!
STEEM does have the advantage that it is very applicable on many levels....it is hard to shoot holes in it no matter what approach one takes. It can fill the currency void well...it is also an amazing blockchain...it has utility and is being used by 60K people daily (and growing).
To me, it is the ideal token at the money.....with continued development, there will be a lot more coming onto this network which will, hopefully, only enhance the value of the entire ecosystem.
I fully agree.
On a side note, I autovote your posts but will be missing a few till SteamAuto is all sorted out.
Has the yearly growth rate pretty much always been above 1000%? Is it also more stable in value than bitcoin and some of the other currencies? I think the steemit platform is what will really give it a boost in the end. I think Facebook is overvalued and Steemit undervalued and eventually I expect true values will begin to show.
Are there any disadvantages to steem? I don't understand why more people aren't flocking here when we have all these things already. Is it because BTC has been here so long or etherium has so much potential for dapps?
As it stands steem blockchain should attract a lot of app developers this year. Pretty interesting