Why has Steem crashed to as low as $1.05 ?
Taking a look at Steemit, the Hack and its current Market share & Value
On the 13 of July 2016 one Steem was as high as $4.5 and this new blockchain project was looking impressively unstoppable in terms of its growth potential.
A day later the site was hacked and the official statement from Steemit
Steemit was today subjected to a cyber attack. In the attack, fewer than 260 accounts were compromised, and less than $85,000 worth of Steem Dollars and Steem may have been stolen.
While the damage was contained quickly (I think within 24 hours) and the losses were not as large as other crypto blockchain hacks, the Steemit response was coupled by clear information and updates that perhaps encouraged the community and added to their credibility, since the hack, the value of Steem and its market cap was greatly affected, Its growth halted and it's been suffering a downward spiral.
So, has the currency lost its value just because of the hack, or are there other factors contributing? I have come up with a list of questions and would love feedback on this so as to have many angles on the topic
Is it because the steemit users can't believe that they are earning money from writing content and they withdrawing their money to Bitcoin and then to $?
Are users not committing enough of their earnings to Steem Power, surely this would affect the price of Steem?
Are more people selling faster than those buying (More supply, Less demand)?
How could the whales affect pricing, they would surely have the most to lose from a price crash, right?
Has there been any pump and dumps on crypto exchanges, that would affect all currencies?
After reading an article on Steemit where they explained the pros of the drop and how it's an opportunity to bridge the gap between the whales and the small fish by getting Steem Power at a reduced price, is this a short term decline? https://steemit.com/steem/@bacchist/the-surprising-benefits-of-the-declining-steem-price
How does the price of the currency affect the payouts for contributions?
I know Steemit is very new (still in beta) and have no delusions of its accomplishments over the last few months versus that of major established and backed currencies.
I thought I would share my concerns and see if anyone has any views on this topic, as it can be rather baffling.
Just being,
South Africa,
I am going to give my opinion based soley on a long-term crypto convert that did nothing with steem other than make a ton of money off of it initially hitting Bittrex and then Poloniex. The overall view of non users is that it's a ponzi. I think that issue takes time to alleviate concerns. Ultimately my concerns are subsiding the longer the platform exists. Ultimately the platform is a blockchain and we don't have to depend on what the developers do in the end. ETC is providing plenty of support to that train of thought. That being said, whales and the devs have no benefit to not actively support steemit because they have the most to lose. In the end if you believe the platform has potential, then it is a steal at this price. If you are in the platform to make money, you should be converted to steem power and producing quality content. This is a much more hands on crypto, that's making it more difficult to quantify value of a token in a world where most people only think of buying power as value and not utility and potential disruption power of a platform as value. Steemit has the power to replace reddit, 4chan, Facebook, and Twitter instantly when people realize taking any centralized censorship out of the equation makes it infinitely more powerful. You don't have to wonder if the company or the government is manipulating news feeds and pushing agendas. If the devs decided to sell out to outside interests it would be plain as day and traceable on the blockchain. Basically people that are trying to get rich quick are jumping ship and people with real beliefs in crypto and public access support it and will continue to do so.
Thank you for your reply, it has given me another perspective. I totally agree with your comment and it's a big steal at the current price. I was feeling rather disappointed that the market cap and value had dropped so drastically suggesting that it was failing but realize that it may not be failure and just part of what new tech goes through in its first few months. I have also just found this article explaining other possible causes: https://steemit.com/steem-price/@hisnameisolllie/why-is-the-price-of-steem-falling
Risk is always an opportunity, just don't get caught up in the concept of having to profit or needing a high market cap to dictate the value of the platform. You and other users are the value of the platform. Any monetary gain is just a benefit of the system working towards a larger audience, and ultimately disrupting the system of controlled media is the important take away from steemit. Also it's extremely important to remember that steemit is one aspect of steem. Steem itself is the underlying platform on which steemit is built, and even if steemit shut down today, you still have a very viable crypto currency that is akin to ethereum. If anything I would say steemit is years ahead of ethereum because of actual use of an app on the platform and the open approach towards multiple markets. Allowing people to enter with Bitcoin, Ethereum, Bitshares, and ultimately for free is allowing a rediculously low barrier of entry into something that has the power to change the world. Steemit like LBC is about more than money, it's about a future where we aren't all slaves to the bank fueled greed system that is killing people for profit all over the world every day. The more people that wake up, the more powerful we become. Eventually the banks will be trembling in fear of crypto, instead of just being concerned. Free the mind and free the world :)
I agree with what you say here completely, especially as regards to value. We have become accustom to base our own self worth on the value of the organisations we work for and not on what is innate in us , this is to be free. Myself, @aslammotala and @spartanZA have are a part of Free Mind Media & Free Mind Health, where we try to do just that, free the mind of all its shackles. Read my articles on this same topic. Im very grateful for where we have come and now for the 1st time have the opportunity to regain our power... Thank you
What synchronicity, we having a discussion about this topic right now :) our company is called Free Mind Media and one of our missions in South Africa is to make our people aware of blockchain technologies and get them out of slavery...
Keep up the effort. None of us are free until we all are, and unfortunately Africa is exploited by more countries and foreign interest than even the Middle-East. Stay safe and spread the message, education is the only way to free people.
Steemit price is falling because the coin supply is expanding by a million coins every 2 days. It also has an extremely low daily trading volume. A coin of comparable market cap has an average volume 30 times that of STEEM.
Thanks for sharing that, makes sense.
The current reason for the drop is because of a market correction, due to Ethereum getting over the ICOs fever and network congestion, and of course Bitcoin BIP 148 activating on August 1st, which may cause Bitcoin to hard fork
https://steemit.com/bitcoin/@rainelemental/day-9-bitcoin-price-crash-explained-july-august