Liquidity rewards - will they ever come back? Is it coincidence that since they were suspended price is in freefall?
I have a fair amount of STEEM gathering dust in my taker market maker account...
It would be nice to get some indication whether the liquidity awards will be coming back anytime soon. To my mind, it is a key part of the steemit system and without it the price of STEEM is at the mercy of external markets. When there is the provision to anchor the price using liquidity awards, it is a shame to let poloniex day traders hop from one coin to another to determine the price of STEEM
Having a deep liquid market for STEEM and SBD will be good for whales, dolphins and minnows.
I also wouldnt mind winning a few more liquidity awards, but if there is no plan to reinstate it anytime soon, please advise.
Thanks
It's a coincidence but it's not correlated. The price free fall is because of the economy design
I wouldn't call this a "free fall"; more like back to reality. When a lot of the content getting up-voted is the same old crypto people that 99% of people don't care about, well it's not exactly executing well on Dan's evil plan for domination since this sort of content is not mainstream and therefor does not attract people who are not crypto-libertarians (which is most of the global society).
There's little value or appeal in stagnation, ideally there should be more drives for content other than the standard 2-3 featuring authors on botlists and a slew of crypto-circlejerk. Most of the people we want to attracts don't give two shits about that. Steemit needs a stream of new users to create more diversity and liquidity.
I'm not sure how to improve the system, but it sure makes curation boring at times in the current state.
I would also like to know this answer, thanks @jl777
Doesn't arbitrage in general keep the internal and external markets aligned without the need to incentive liquidity? I don't see a connection between rewards for liquidity and the price plummet. If the stuff is flowing on both markets with decent volume what value does it add to reward a few bot owners large amounts of steem for nothing? Why would ending that cause the price to go down and not up?
of course the points system needs to be fixed so it isnt just a few bot owners getting the rewards
as far as price plummet theory consider this.
SDB stability creates value, the corrolary is that SBD volatility reduces value as if we cant rely on SBD to be close to a dollar, then the entire steemit system is less reliable (for fiat oriented people)
the liquidity before was overkill, but now, if anybody sneezes the internal market price changes by 20%. Not exactly whale friendly, or even if you need to cash out to pay rent it is not good to move the price 10%+
24hr volume of $14130.54 for a market cap of $100 million+
you might not see a problem with a 10000x difference between marketcap and liquidity, but I do.Liquidity creates value and so does stability. right now just relying on random buyers and sellers, there is no depth most of the time and it is not anything that can be counted on.
It's like going to the bank and they say, "sorry we cant process $2000 right now, but we are happy to convert $250 today" how confident are you in such a bank?
do you still not see value in liquidity?
I think this can be solved easier with a bittrex button. This will increase volume, liquidity and tightens the internal external spread and still allow Steem for curation, posting, and mining.
https://steemit.com/steem-ideas/@dennygalindo/let-s-get-a-steem-sbd-pair-on-bittrex
It about time we fix it. Authors cashing out is what keeping steem prices low
So let's stop paying authors so they can't sell and drive down the price!
:)