Steem Price is Down. Should You Be Worried?
I hate to say it, but Yes, I think you should be worried. I have read many articles on steemit arguing that the price fall is only temporary. I am sorry, I disagree.
The price of steem did not fall suddenly, but rather gradually. This is a sign of a fundamental problem. So, if we really love Steem and Steemit, we should acknowledge the problem and solve it. Denying the problem won't work. I know it is bitter, but we have to do it.
Why Low Steem Price is BAD?
1- Lower Rewards
Because it affects the payouts value. The rewards we are getting from writing and curating articles are paid in steem. So, when the price of steem is low, the rewards, are low too.
2- Lower Upvote Value
The same previous reasoning applies to the effect of the upvote. Of course, your upvote has the same % value, but its $ value is less.
3- Attracting New Users is More Difficult
It is not a secret that the rewards are the most attractive aspect of SteemIt. It is the main incentive for new content creators to join Steemit. Therefore, when the rewards are low, the system is not so attractive anymore. This is especially true for people who have many followers on other platforms.
So, Why Did it Go Low?
This is the important question that we should find the right answers for. I will offer my view and I hope that you would help me too.
1- Too Much Good Content is Buried
I have noticed this problem since my first days here. I have even written about it. Steem is supposed to be mined by producing good content. Unfortunately, the current system ignores most of the good content.
When good content gets ignored, the author gets disappointed, and most probably leave steem, committing STEEMICIDE (Steem Suicide).
Why Does That Happen?
@thecryptofiend has written a good article about this. He argues that the curation system is the reason for this. I agree, but I think it is a reason, not the reason.
Another possible reason is weak distribution. The right content does not reach those people who are interested in it. The system lacks artificial intelligence. If you liked (and upvoted) an article, the system does not suggest similar content. Actually, it is even difficult to find a post that you have upvoted earlier!!!
Another reason is the weak search. I can not believe that we are still using the google search. Quoting @timcliff, we need "Advanced Search (number of votes, posted time, author reputation, etc.)"
Another reason is that you can not follow a category (Community). This option was one major reason for Reddit success. Fortunately, We are promised that this feature will be presented in HF20.
2- The UI and UX of Steemit is Average
I believe that we could do MUCH better here. Developing great UI/UX does not require experienced blockchain developers. Even worse, @etherdesign offered a great new skin for Steemit. The suggested designs are really great. This is a sample:
Everyone loved the idea that his post has earned $8600 in rewards! Yes, $8600 💰!
Unfortunately, it was not adopted. 😠 😲
some other problems with the UI/UX that have been mentioned by steemins are:
- Too little customization is possible.
- The notification system is so weak.
- No chat and no private messages.
- No Following tools. You don't know who has followed you. You can not sort your followers, ...etc.
- The Editor is so weak and has so many problems.
- Tool little statistics.
- No support for languages other than English. The problem is worse with RTL languages like Arabic, Persian, and Hebrew.
3- The Development is Too Slow and Not Transparent Enough
This is so clear. I don't know the reason for that. You would expect a project with a market cap of about $230,000,000 to evolve much faster. Why is that happening ?!
I don't know!
Maybe Steemit Inc. got happy with the success it achieved and lost the motivation for more hard work.
Maybe, we think that offering possible rewards is enough.
Maybe, this is a result of @dantheman leaving steemit. Maybe he took some of the good developers with him to EOS. A notable comment by @dana-edwards:
The problem is Dan Larimer had the vision, was the technical brilliance and main problem solver. Without him who is in charge? Ned? But Ned cannot provide the technical leadership needed to make Steem competitive with Dash, Ethereum, Rchain, Synereo, or any of the other major projects. I think this could be the decline for Steem and I'm regretfully forced to power down at a time when I wouldn't want to. So much opportunity exists for Steem right now and it might be gone.
Maybe there is not enough budget allocated to attract new talent.
@timcliff has assembled a wish list of important improvements about a year ago. They are not bugs or little improvements. Many are essentials. I have mentioned some of them in this article. Unfortunately, after one year, we can see that most of them have NOT been implemented yet. I am sure many more suggestions have been added since one year.
Another problem with in the dev-team is transparency. It is not clear (at least for the regular steemian like me) how many developers are there? Who are they? What are their priority? etc.
Moreover, The interaction of @ned, @dan and the rest of the founding team with the community is too little. I am sure that most steemians would love to have more interaction.
4- The Platform is So Difficult for New Users
Steem is so different from the usual social media. If you are not familiar with Steem and blockchain, it would take you a long time before you are able to understand the system. It is too complicated and in many cases, it is not intuitive. To make it more difficult, hard forks keep coming with new changes every now and then.
In addition, there is no official help, wizard, wiki, or tutorial. Of course, some steemians have offered some voluntary solutions like Steemit Help and Steemit Etiquette Guide by @thecryptofiend and Steem Center by @someguy123. They do help, but they are not enough. Moreover, they are not easily available for the new user.
5- Buying Steem is Difficult
A special problem is that buying Steem and SBD is not easy. Steem is supposed to be a social network for everyone, and everyone can not buy Steem through cryptocurrency exchanges. We need a very easy way to buy steem directly from the SteemIt.com.
How do you expect the price of Steem to go up when buying it is so difficult and intimidating for most people.
6- The Financial Incentive To Buy Steem is Weak
I am not talking about speculation. I am talking about real financial income because that is what drives speculators to buy.
From a financial point of view, there is not a good reason why you should buy steem. Of course, there is a social incentive: the more steem power you have, the more social power you get on the platform.
But what about the financial aspect? Is it a good business? How can you benefit from buying steem financially? The only way I can see is self-voting. Too much self-voting is not healthy for the system as we can all agree. Yet, it is still the best way to profit from your investment. Hence, it is not surprising that all of the top 100 authors are self-voting.
I think we need a better incentive here.
7- Not Enough Marketing
The number of new steemians added daily is becoming lower (Some days we have only 303 new users) while it should be increasing exponentially. If you have been browsing steemit lately, you would have noticed that there are so many subjects with too little posts and interaction. Too few people are using Steemit.
Please, do not say Steemit is new and still in Beta!
It is not. Successful social media platforms usually attract users so fast. Within 15 days of its release, Kik Messenger reached one million user registrations. Now, it has more than 200 million registered users. We only have about 320K users after more than a year. We are NOT doing it right.
Maybe the difficulty of registration is a reason. The many problems mentioned earlier is another. Improving the system with the rewards incentive will attract many new users.
Weak marketing is another big reason. I have to offer special thanks to some active witnesses who are volunteering to fill this gap like @jerrybanfield and @timcliff.
Those are the reasons I found for the falling price of steem. Please, tell me what you think.
Comment Don't Spam
If you like my post, please upvote, follow, and resteem. If you write a good comment, most probably I will upvote you and check your account. Please: do not spam. Spammers are not welcome in Steemit and will be flagged.
If it goes to 16 cents, then we all become whales with no ocean to swin in. Why? To many fat whales...lol
Lol ...whales would turn into FED, print currency into oblivion, result ?? hypersteemflation!
That is so funny, @paco.
However, I prefer to be a dolphin in a big ocean :)
This shit needs to go, if it doesn't, two word comments, and shitty posts of old men with nothing better to do with their time will rule the front pages of Steemit, and the little Asian girls that they like with their shitty posts will as well, via their super powered up-votes!
For self-voting to go, Steemit needs to find a better incentive to buy steem. If they suddenly ban self-voting, no one would buy steem any more!
If no one has faith in the system without self-voting, then maybe Steem along with it all its platforms will inevitably fail.
Remember Steem is a cryptocurrency, and Steemit is a platform built atop it, if people don't have faith in either, they will never make it.
How could this platform ever succeed if the small minority of users with all the power just vote on their own content all day?
I think we have to stop worrying about the whales, or the price of Steem, and just develop a great community along with great content on here.
Eventually the whales will get bored, since the only people interacting with themselves is themselves, and at that point, Steem will be worth a penny or less, so would they even really have any incentive to stay or vote at that point?
If Steem is ever worth a penny, you've totally killed the platform already. Stick a fork in it.
Not really, Reddit Karma isn't worth anything, and yet it's one of the most trafficked websites in all the world, so even at $0.01 it's still worth more than Karma on Reddit.
I can agree with that. But we still need the system and UI to be enhanced. Actually, the main problem, in my opinion, is the slow development.
I concur! 😉
what you said is not wrong!!
Point number 1,3,4,7 is what can be fixed if people stop for a while in making personal profit and actually think about the community as a whole. I agree to the rest of the points as well but community needs to acknowledge these problems first. I would also like to add one more point however your article covered all the major issues.
People spend time while creating their posts and they expect at least comments if not upvotes, if after writing something original your posts goes unnoticed, your start to lose the interest and over time this thing alone start to discourage you. Now if the can't retain the older users, what's the point in engaging even more people when at some point they will go through the same experience?
I also agree to the point where you've suggested that no similar posts are presented to you when you curate, these points needs to be acknowledged and if possible, fixed asap.
Funny that you picked those out, since I was thinking 2, 5, and 6 are the biggest problems. But they're also harder to fix.
Thank you @kissofearth for your comment.
Unfortunately, this rarely happens.
I like to curate. I actually curate and comment more than I write posts. However, the lack of good curation tools makes so difficult to do that.
"This is a sign of a fundamental problem."
No, it's the sign of a trend.
I think you make good points. 2, 5, and 6 are the worst offenders, if you ask me.
Thank you @lexiconical for your comments.
I agree that it is a trend, but what is behind it? low prices means low demand. I am trying to say that this low demand is caused by fundamental problems like insufficient development and marketing.
Those may be components, but the rapidly rising Alexa rank and new account creations would seem to imply that's not the problem.
I think other projects are sucking up money atm, like Bitcoin Cash.
Good post, @sadekj! Lots of valid points :)
One of the primary things that makes Steemit unattractive to me, is actually the use of terms such as whales, dolphins and minnows. It shows the overall mentality on this platform and it's just not what Steemit should be about.
I get where it's coming from. The whole community has so far primarily been built upon the fact that people can earn money by being active here. And while that's a great incentive to get people to write good quality content, it also attracts massive amounts of spam and abuse.
I haven't used Facebook (as it's intended - I'm a dev, so I do work with it) since 2009, and would love for Steemit to be what Facebook failed to become. (an actual social media platform, rather than a two-faced advertising agency)
At this point, Steemit just doesn't give the right vibe to replace any existing social media concept. The tech and idea is there - and it's good - but every other post and comment is about upvotes; people are literally begging for money.
If I want to be harassed by beggars, I'd wave around my wallet in the city center. Or log on Steemit.. Unfortunately.
I'd say Steemit's deteriorating image is, or will likely become, the biggest issue the platform is facing.
You're on fire!
That is so true @extremelyginger. Upvoted! and Followed! (I hope you would post something :) )
Steemit should be a place to create great content. The money should be an incentive only, not the main goal.
The problem is how can we create a platform that would reward good content with money without making money the main focus. It is a tuff question. Any ideas ?
Indeed! And that is a tough question.
I'd honestly have no idea how to make it so that money is not the main focus. The whole concept sort of evolves around it and it is a major strength / selling point too.
One could suggest that Steemit changes the way it displays the current value of a post (e.g. change it to display STEEM instead of $), as to make it less obvious. But again, we'd be messing with a selling point too. Stuffing it away would also go at the cost of transparency, so that's not worth it either, since transparency is another thing Steemit has - something far most other social media platforms definitely have not.
I might be wrong about the vibe on Steemit being/becoming a big problem, but that's what keeps me from using it properly/frequently.
It might just be me! It might be just a phase Steemit is going through. Or maybe it is just indicating a need for site-wide moderators to keep an eye on fraudulent or spam-like posts/comments, as Steemit grows in popularity.
Either way, combine that with all the points you listed too, and there's plenty Steemit could (and should, for the price'/growth's sake) improve on!
It still has major potential, so I'll be watching from the sidelines for sure! :)
""""that's a great incentive to get people to write good quality content"""" What content have you contributed?
Come on man, he has 9 comments and 0 posts! He's the heart and soul of this place.
You have some very good points and I agree that the platform has a big learning curve for new users especially ones that have never used cryptocurrency. I personally think the price is overvalued as I remember just a short time back it was at around .08 and sky rocketed. We are in need of a major correction back to the .25 range.
Thank you @azfix for your comments.
I have to disagree here. The value of steem is different than other cryptos. Its value should be measured by the quantity and quality of the content it is generating, and that has skyrocketed since it was 0.08.
If its measured by the quality and quantity of content then it might be at .01 whats really interesting is the technology behind Steemit and having a social network on a blockchain.
@sadekj you nailed everything here! Im a new user and I already realized the problem with content being bueried underneath tons of crap! I wont even begin to talk about search engine... :-D There is also too much "politics" with all that flags wawing around. I dont know, I really do like the idea behind steemit but the technicalities are letting the platform down. Altough, it is a really good poiter where humanity is going... :-D Half naked girls have the most followers and earn the most money! Its like the music industry... :-D We have a microcosmos of idiocracy here and it will be interesting to se how are we gonna try to deal with it because there are many users here who do post quality content. We just need to be able to find them and pick them out of the others... Jesus, i taught this would be short.... :-D
Well, it was not short, but it was good.
I know the feeling you are experiencing. I have been there.
I think that if Steem and steemit do not get enhanced, they will not succeed as we would like them to. Luckily, the dev team has just published a post saying they will soon introduce many enhancements!
I was planning to power down and sell the steem I have, then I read the announcement and decided to wait a little bit more.
Thank you for this article. It is one of the better ones I have seen. I invested a good portion to get started and question if it matters. Love the proposed UI Skin from what I saw.
Great job on providing constructive criticism with some ideas for proposals instead of just being a basher, complainer, or know it all.
Thank you @realestatecoach for the kind words.
Thankfully, the dev team has announced that many of the mentioned issues will be solved soon. I see a much brighter future for steemit now.
disappointment, steemit is being advertised as decentralized, without ceo, not a private company. but it is not. it is a private company with its ceo, and cto, not much different than facebook
Hi, @dovlet.
I think you are mixing up Steem (the blockchain) and Steemit (the front end website and the company). The blockchain is decentralized. Therefore, it is possible for any one to run a front end on top of it like busy.org.
However, steemit is not. Yet, you still can contribute to the development if you like. Check this post by @timcliff.
It is true that the lower value is bad because it gives you less payouts and less upvoting power. This might actually be the reason why the price has gone down slowly in time, not a sudden crash. Because of the lower prices people are less likely to care to write a blog, because they will get lower rewards. So people start leaving steemit. This means that less people are upvoting now so even fewer rewards for the people who still make posts. Causing some of them to leave. And so on and so on. We are in a negative spiral, causing a slow but steady decline. Once we break that i see no reason for steem to remain on the low prices. i do agree with some of the problems on steem, for example the not suggesting similar content and so on. But once we get out of the downward trend and start recruiting new steemians i am sure they will start tackling all of these problems one by one.
Thank you @sherlock2 for your comment.
I agree with what you said. We need to break the negative spiral, and the best way to do that is with big enhancements and good marketing.
Interesting approach, you reversed the causality, first better marketing and technology to stop negative spiral. I have to say it makes more sense your way! Thank you for bringing this to my attention!
Every vote should have equal power.
Ah, so you'd get to vote more, and investors would get less, which would drastically lower the cost of Steem, rendering the platform useless.
Yep, I think communism still fails at everything as of 8/20/2017.
In other words, no, bad idea. Ridiculously bad idea. Epicly bad, useless idea of platform destruction.
more votes would still generate more money for a good content maker, investor would probably have more faith on the sound money and probably buy more. wouldn't they ? how would it be communism, we are not talkin about giving out to all, we are talking about generating currency with equal vigor and someone with good caliber would still earn more. lol....buddy? that is not communism!!!! are you self voting there?
Your suggestions are typical of those new to the platform.
If all votes were equal, there would be so much abuse the platform would not work. You have to reward stake.
There's one guy who runs a botring of 2890 bots. He posts a spam comment, like just the letter "a", then upvotes it 2900 times to make $3.
Do you know what would happened if that wasn't already controlled by stake weighting? Abuse until Steem is distributed widely, then becomes useless, like the currency of communist countries.
When everyone has it, or can easily get it, it is worth nothing.
PS - Yes, I self voted like a penny to order my comment up, that's all.
You do sound logical to me now, that bot point got me ...wow!!! Never thought that way, did that really?Thanks for the constructive effort!!!. Though i disagree with your commis point, nevermind!
i believe in brainstorming all side of thoughts. I would use steemit with or without a penny..... i think your effort does have value so here goes my upvote to you.
I'm being a little provocative with my terminology.
The truth is a little more stake for real minnows, that we could somehow keep from bots/abusers, would be great.
I just don't have any good suggestions for doing that, however. Maybe make the first 100SP that a user buys/earns give them 2x-10x the normal voting power?
But then, what would be the incentive to buy more steem?
Buy out of confidence...real asset backed by real peoples vote ...like honey made by equal effort from bees...."that is value"...not because just i loaded up my account and my crappy click now generates 5 dollor where as it might take 100 clicks to generate that amount..?
Do you believe just because you have more money you have rights over money creation?
By this theory if justin biber watches a movie ...that should be equal to 20000 people worth on the box office
Maybe you are right. But what that means is that the whole Steem concept is broken.
I think it is not. I believe it needs some improvements.