The Rapid Rise of Digital Currency Steem

 

Steem is what is called a cryptocurrency. In other words, it is a  currency that uses a number of ever-evolving encryption techniques and  technologies in order to govern the generation of additional units of  the currency as well as transactions involving the same, which is a  significant difference from standard currencies, which are reliant on  central banks as well as the rest of the governments that issue them.  Steem is the latest in an enormous number of cryptocurrencies that have  been launched since Bitcoin popularized the concept in the public  consciousness, though it is interesting to note that it has made some  interesting innovations on its predecessor. 

Why Has Steem Seen a Significant Rise in Its Value?

Recently, Steem has seen a more than 1,000 percent increase in its  value, thus bringing the total value of the Steem units that have been  issued so far to $130 million within the span of two weeks. (1) This is  an incredible movement by any standard, but it is particularly  incredible because the cryptocurrency has just been launched.  Furthermore, it is interesting to note that there are signs that suggest  Steem might not have become the fifth most valuable cryptocurrency in  the world in such a short time based on just hype and no substance,  meaning that it could become even more valuable in the near future. Here are some of those signs: First and foremost, Steem is based on a particularly clever way to  monetize social media platforms. (2) In short, the most successful  posters have been known to make respectable sums of money by posting  social media content on a regular basis, but for most social media  users, that is not possible, whether because they lack the ability to  create such content or because they lack the time and effort needed to  do so. There has been speculation about introducing such a feature to  social media platforms, but that is all that it was up until the point  that the people behind Steem released Steemit, which is a new social  media platform that hands out units of Steem to users who post content  liked by other users. As a result, the feature serves two purposes.  First, it increases the number of people who might be interested in  becoming a Steemit user, which is the single most important factor for  the success of a social media platform. Second, it increases the number  of people who will be using Steem, which is the single most important  factor for the success of a cryptocurrency. Second, the social media platform comes with the option to exchange  units of Steem for units for Bitcoin. This is a rather clever move  because it provides its users with some assurance that their  cryptocurrency will have some value no matter what happens since they  can exchange it for the single most popular cryptocurrency out there  without having to jump through a tedious and time-consuming sequence of  hoops in order to do so. In turn, this raises their confidence in the  viability of Steem, thus making it less likely that particular option  will have to be exercised. Summed up, Steem is backed by Bitcoin in much  the same way that national currencies were once backed by precious  metals, except this will work better because national economies have  long since become too big for national currencies to be backed by  precious metals in this way.
  Finally, the fact that Steem has a sizable organization behind it  should be considered a point in its favor because while it might not  have the same tools as a central bank, it is still much more capable of  interfering in case of a crisis than the weak and tenuous organizations  behind other cryptocurrencies. This is particularly true because the  people behind Steemit seem to be well-prepared for the challenges that  await them, as shown by their collection of relevant expertise and  experience as well as their financial backing by a superangel investor.  As a result, if they play their hand well, it seems possible that they  will be able to use their current wave of success to secure funding from  institutional investors, which will enable them to make Steemit and  thus Steem even bigger successes. 

Will Steem Be a Success in the Long Run?

At this point, it is still much too soon to tell whether Steem will  be a success or not. On the one hand, the people behind Steem seem like  they will be able to handle all of the challenges that await them, but  on the other hand, first movers are not necessarily the ones who will be  able to reap the most reward from a particular trend. After all, a  first mover is also the one who will be first to make critical mistakes  that could not have been anticipated without actually seeing action,  whereas those follow in their footsteps will have to chance to observe  their choices before making better decisions by learning from them. As a result, while Steemit seems like it holds some promise, it might  be other social media platforms that will benefit the most from  incentivizing their users to post useful and interesting content,  particularly since cryptocurrencies are notoriously risky and  unreliable. Should the people behind Steem prove that incentivizing  content creation is an earner but become unable to keep Steem under  control, it is possible that bigger and better-established competitors  such as Facebook and Twitter will step in to capitalize on such  opportunities in a way that they cannot.
 

Still, those who are interested in cryptocurrencies should consider  taking a look at Steem as well as the Steemit social media platform.  After all, Steemit is a social media platform like any other, meaning  that they should be able to earn likes by posting about a wide range of  topics both with and without relevance to cryptocurrencies. Better  still, the time and effort needed to use a social media platform is  minimal, meaning that they will have lost next-to-nothing even if Steem  turns out to be a failure, which is not something that can be said about  a lot of the other cryptocurrencies out there.