Do we have an intrinsic value?
Let me say right off the bat that I’m not big believer in intrinsic value of (almost) any sort. Truth be told, I had to yield in some of my countless discussions about the topic and I now believe that intrinsic value does exist in some of the commodities that are simply needed for survival. It’s very hard to argue against the fact that people will always find value in water, oxygen and food, for regardless of our attributes, our whole specie needs (and probably will always need unless some major highly unlikely game-breaking science discovery occurs) those commodities for survival. Thus said, there will always be some minimal price tag on those commodities and that can safely be called intrinsic value.
Steem (or any other cryptocurrency) is though very different story. Some economic discoveries exist that somewhat prove (even though usage of a word “proof” in economy is very bold) that it’s very hard for any sort of money to reach 0 value. Cryptocurrency is of course money, in fact it’s the very first “free/liberal money” that humanity has had the chance of owning since the gold standard. Does the fact that it’s very hard to reach 0 value mean that it has intrinsic value above 0? I think not. Easily put, we can fuck up heavily and no one is going to be willing to buy our internet money, therefore those owning it are not going to be able to sell it. That is not the case for unspoiled food for instance. We do not have any intrinsic value to lean against if need be. It’s only us, our ability, our actions, our votes (you name it) that are either going to help us, the community and our token, to grow or shrink. The saving grace for us is that it is very hard to fuck up so much to reach 0 value.
Utility token
It has fascinated me ever since I joined cryptocurrency sphere (via Steem of course) about 2 years ago that in many cases we are not only dealing with money like we always understood it (medium of exchange, store of value, unit of account…beating the system of control lately [1]). Many cryptocurrencies do have a utility purpose for us. Its value directly correlates with that utility too (apart from the other obvious aspects stated above, but in crypto sphere also enriched for security (cryptographic…but not only), speed of transactions…we all know the drill – if not, this is not the correct article to learn that information from.
Which brings me to the most important and also the hardest question to answer. What exactly is the utility of Steem token? Can we perceive positive externalities of the Blockchain (like censorship resistance) or content itself as part of the tokens utility? Or is it simply what the token enables us to do/earn? If the latter was the correct answer, then the question would be easy to deal with. Steem tokens utility would be to earn ROI via Blockchain supported actions (curation, bidbots, delegations), the ability to import our data into the Blockchain (RCs), allocate certain amount of Steem to whoever we seem fit according to our VEST + the above mentioned aspects that define money obviously. In my personal opinion the correct answer is the former since the positive externalities directly correlate with the token and its utility, but the aspects are weighted differently (much bigger weight would be attributed the direct utility like ROI and much less to positive externality like censorship resistance on the Blockchain), therefore it is unimaginably tough to quantify.
Where does this bring us? Since it’s impossible to quantify the weights for every individual due to the problem of “interpersonal incomparability” [2], we should simply treat the utility as if the answer was the latter. Also other Blockchains have the positive externalities too (or will have)…that is NOT our competitive advantage. Possible changes that could drive the demand for the token will be discussed in separate article.
Why did we lose so much value lately
Yet again there are many aspects. If you want to get to know many reasons why we are leaking value of the Steem Blockchain, check
analysis [3]. I’m going to cover the most pressing ones. I’m going to add some new, copy some and disagree with some.
Reason number one, two, three and four is NED. You heard it. Because of countless fuck ups Ned has been continuously selling his premined stake which resulted in hundreds of thousands of sold Steem to cover the Steem inc. costs. There is no individual that could have had the same downward value pressure. As my good Steem and real-life friend says (I’m not going to mention him lol): “Ned is fucking pain”. You bet he is. There currently is the “power-down drama” that is also going to be targeted in separate article, but know that he has already sold tons of Steem. This is not something new. The powerdown drama has been causing us millions already before it became drama. There is nothing we can do with that and I’m not going waste any more time in this article speaking about that.
There actually are reasons why even we, the community, are responsible for the downward value pressure (starting from reason 5 of course lol). Bear with me. This is not meant to be some kind of targeted hate against specific niches. I need to use some examples and I’m simply trying to forward the discussion + I’m always willing to be corrected. Whenever users sell Steem, they are creating downward pressure. It’s totally understandable that we all are going to sell at some point. In my honest opinion that is ok as long as we sell at high prices, because we sell little Steem and still satisfy our monetary needs (compared to selling Steem for 20 cents when we need to sell A LOT and barely get anything done with the money).
We are actually hurting Steem if we support users and projects that are continually leaking value by supporting FOR EXAMPLE charitable projects that do not bring new investors or that didn’t directly raised the money. No, magic money didn’t pay for the food, clothes etc. We all did pay for that. Now I’m not saying that we shouldn’t do any charitable projects here. But the reality is that we are leaking value and unless the charitable project catches eyes of new investors, we have successfully “wasted” money (unless the charity did raise the money prior to the distribution). If I use 
Now I intentionally used one of the supposedly biggest leaking projects, but individual users are to blame to. Whenever we vote for someone who has minimal SP stake and is selling most of the acquired Steem we are killing our value. Now even I personally am not without blame. I continually try to improve my curation strategies (will be explained in the next chapter), but I have also personally supported lot of “leakers” in the past (and maybe still do even now).
Then again, how to quantify the value that the content brings in? That’s undoable. Homesteading brings no value to me (city boy), but does bring value to users living “countryside lifestyles”. We can ONLY quantify the value by the powered up SP. Not by comparing my city boy’s stake to the one of the homesteader’s. Instead we should measure us individually and see whether we are continuously setting new higher SP limits for ourselves and if we keep majority of the profits received via upvotes IN THE SYSTEM. If not don’t support us please:).
How do we gain value
It may sound like selling is always bad. Well there are countermeasures. For example if you were selling Steem for 3+ dollars like me then it would be very easy to buy back MORE than what you’ve sold (possibly even beating the interest rate on individual level!). During the cycle a basically doubled my stake, therefore I believe that I have been a positive speculative force for the ecosystem in in the long run. Thus I (you) satisfied the monetary needs but at the same time waited for the moment when the system needed us the most and bought back more than what we sold (quantity-wise, not money-wise obviously). Less supply = higher value.
Perfect example how business could be run on Steem is 
As individuals, it is our responsibility to keep most of our profits in! If you want the system to continue and to enable you to actually be able to work in decentralized community called Steem you better show it by powering up. I disagree with
People also often talk about mass adoption being our saving grace. I beg to differ. We couldn’t care less about leakers and you bet that most of the new users would be leakers. Instead we need to seek genuine users. We need to seek users that are willing to learn about the system and that are going to help it, not only use it for their own benefit. It is then responsibility of us, the curators, to distinguish between those users. Now I don’t try to say that we shouldn’t try to on-board new users by any means. But we shouldn’t pursue on-boarding blindly. We need to TARGET the right people to on-board. I don’t have answers as to how to do this globally. I personally have only on-boarded single investor that has bought about 700 Steem. Technically speaking - from the perspective of sustainability I have done much more than someone who would on-board 300 users that didn’t buy/earn single Steem. To give an even more extreme example – I have done infinitely more than someone who has on boarded 1000 users that have all powered down everything they received via upvotes and sold it on market. Quantity on-boarding gives us wide shot of acquiring investors but also leakers. It is most helpful when our goal is to “spread the message” about the platform. Quality on-boarding enables us to target the right people for the right system/job and create value with higher probability.
I have also come across new users that have gathered significant interaction. They were unable to interact with all the users due to low RC. I have been very happy to see big investors delegating to handpicked new users that have potential to become good and (hopefully sustainable) Steemians. If you wanted to check this statement out personally I recommend visiting this introduction post. Nevertheless, this is really good way to go. RCs are essential. Anyone who has been around for a while knows this. It has its weak sides though. That’s when we personally could step in.
I also need to mention that increasing the utility of the token will drive the demand. If we improve the current utility of the token, we are going to gain a lot of value, because it would simply be worth it to hodl more Steem. Different article will tough be dedicated to our options regarding the utility improvement.
That’s it for the first article. I’m interested in what you might have to say. I understand that some of the opinions aren’t the mainstream here. Many more Steem related articles will come!
Sources
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ANTONOPOULOS, Andreas. Money as a System-of-Control
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VON MISES, Ludwig. Human Action: A Treatise on Economics. 1. United States: Yale University Press, Ludwig von Mises Institute, 1949. ISBN 9780865976313.
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STARKERZ. My Thoughts and Theory on Steem Price Sustainability. In: Steem [online]. Accessible from: https://steemit.com/steem/@starkerz/my-thoughts-and-theory-on-steem-price-sustainability
