And it has nothing to do with steemit.com or steem specifically!
To fully understand why I think that, let me tell you a little about my experience last week trying to set up a crypto account for a friend of mine...
A friend of mine contacted me last week and said he wanted to get into cryptocurrencies. Not necessarily just into steem, but instead buy a well diversified basket of different ones.
The first thing I instructed him to do was set up an account on Coinbase.
Should be simple enough.
Create an account, transfer some dollars in, buy some cryptocurrency.
This is where things got a little tricky...
He was having trouble setting up an account on Coinbase so I told him to try a few other exchanges where he could transfer some money in and buy some coins to get started.
The first one he tried after Coinbase was Gemini, the exchange set up by the Winklevoss twins.
I had read a little about it and it offered a lot of the same things Coinbase offered.
It lets you link a bank account directly and they insure your holdings, two big pluses in the crypto world. Also, it's one of the few exchanges that keeps holdings in cold storage which makes them much less vulnerable to a hack.
The only drawback is that they only operate in 42 states.
Lucky us, we just so happened to live in one of those 8 states where Gemini is not currently licensed.
So, our option to use Gemini? Move to another state...
Considering that was not going to happen, on to the next one we went...
Next we tried CEX.IO.
CEX.IO is currently not accepting new customers, lovely.
Back to the drawing board...
Next up, we would try Kraken.
Again, the exchange looked good on the surface but when we actually tried to sign up it was very difficult.
For one, getting a name and password created and actually creating an account was like pulling teeth. Everything we tried wouldn't be accepted, whether it be our username or our password.
Then finally when it was, we were told we would be receiving an email to confirm our account. Except the email never came!
A few hours went by and we tried again, still no email.
Finally an email showed up, which we tried to use to confirm our account, but when we tried to confirm our account with that temporary password, we were promptly told that the password given to us in the email had expired.
Are you kidding me? The email takes hours to get there and when it finally does the temporary password is already expired?
Aint that a kick in the shorts!
Needless to say, we gave up on that one.
The search continued...
Next up, we took a look at Poloniex and Bittrex.
Which we found out right away that neither offered fiat support. Meaning we couldn't get dollars in or out without also setting up another account on another exchange with fiat capabilities.
All of this was becoming majorly frustrating to say the least.
Next up we tried Bitstamp.
We were able to create an account but soon realized it was based in Europe and was pretty difficult to get dollars into, at least according to our initial impression.
Luckily, right about this time we finally got confirmed by Coinbase for an account.
But our troubles did not end there...
Now that we had an account on Coinbase, it appeared that trying to get money into the Coinbase account was not going to be an easy task either.
For one, they only offered small deposit maximums unless we verified the account. So, we did that.
After verifying some basic information the deposit and withdrawal limits increased slightly, which was helpful.
Next we tried to link our bank account.
The struggle continues...
My friend uses a local bank offered by his work, which of course was not on Coinbase's accepted list of banks to link to your account.
Which means he had no way of transferring dollars into his account from his bank account.
So, here we are again, with an account finally created but no way to get dollars into it, apart from using a credit card and only purchasing a very small amount each week.
Which, using a credit card was not even really a long term viable option anyways because then we would not be able to get his funds out after he got them in as there was no way to link his bank account...
So, we figured the best option for him was to go out and open a new bank acccount with a well known Coinbase accepted bank, and then transfer funds in and out through that.
Yes, you read that right, our best option is for him to go out to a well known bank, open a new checking account and then link that to his Coinbase account in order to get funds in or out. The entire process will take days/weeks depending on which route he decides to go.
What I learned through all of this and how it might affect steem...
People can't get dollars in or out of the crypto markets!
Which is why they aren't going to crash any time soon. The money that is in here currently is just sloshing around from bitcoin to altcoins with no ability or intention to leave the markets.
Also, many in the markets (rightly or wrongly) believe that they don't have to pay taxes on their crypto gains as long as they don't turn it into fiat.
Which means they just trade it back and forth in the crypto markets depending on what the hot coin for the moment is.
Which means that with the crypto market cap currently being around $816 billion and steem only being around $1.6 billion of that, with the right news/momentum, some of those billions could easily swing towards steem and propel it many multiples of where it is currently trading.
Basically is what I am saying is that given the current crypto dynamics, steem (and many other coins) could easily trade many multiples of what most might consider their actual worth. Though that in itself is a hugely debatable topic.
As long as money keeps sloshing back and forth like this, we could see steem hit some ridiculously high levels.
Just need some momentum. ;)
Also what happens when these things become easier for people to get money into them? Just something to think about...
Stay informed my friends.