Hello again my fellow Steemians. In this blog I will discuss my five top reasons why I currently believe Steem is highly undervalued.
In my last post https://steemit.com/money/@hedge-x/why-following-a-crypto-index-will-make-you-bank-over-the-next-few-years-steem-happens-to-be-top-holding
Dated Sept. 2016 (9 months ago) I discussed why investing into a crypto index will make you bank over the coming years. Since then we have seen a about a 20 fold increase from the time of writing. As you can probably tell I do not post often but when I do I put a lot of thought in behind it. BTW I am not a blogger but crypto investor and established Entrepreneur. So excuse my grammar - I am not here to teach English classes but give my investing opinion which has a successfully established track record in crypto investing over the last 4 years.
One more note: I am not giving you investment advice. This my opinion only. Let's get to it.
Why Steem is highly undervalued?
Reason #1
Major Steem DAPPS are launching over next few months.
These include a few major ones that I know about but there is many more that are off the radar. Remember Steem runs on open source software anyone can build on increasing its network effects.
Zapple - The Steempowered Twitter. Enables micro blogging.
Steepshot - Steem like Instagram
ChainBB - Steempowered forums. Enables communities to form around certain topics. Similar to Reddit if you have ever been to r/ bitcoin or r/ ethtrader you know this is very powerful. Imagine when you layer Steem currency on top of it for writing quality post instead of Reddit Gold which basically worthless.
The big point I want to make here is that the way Steem is currently set up is just one app and that www.steemit.com.
While Steemit has attracted over 300,000 users and a daily active user count of 25,000 this is not the Steem we will see over the next year. The way Steem is currently set-up is not that user friendly yet. Steemit has been improving but the big multi functional Steem is just now starting to arrive.
Let me breif you just for a moment why this moment is gigantic for Steem right now. I will make a direct comparison to my Ethereum investment last year.
If you go back a study what was going on with ETH was a very low price of $6 in Dec. with a market cap of $600 million. Recently, it touched $420 with market cap approaching Bitcoin. Now things have cooled off a bit with consolidation in the upper 200's but still is very impressive none the least. A 40X return in under 8 months - insane.
Now I am seeing the same type of eco-system approaching Steem in the next few months that will lead to exponential growth similar to what we saw in Ethereum. Steem DAPPS will make Steem 100 times more user friendly and useable for your average person and this what we need for mass adoption of the Steem blockchain which will put Steem tokens
in high demand; therefore exponentially increasing the price in a 10-20X multiple over the next year.
Reason #2
EOS
EOS release will draw in major attention to the Steem Blockchain. The last price of EOS was at $5 and #7 top crypto on CMC. BTW Dan is the creator of Steem, Bitshares and now EOS. The volume yesterday approached just under Bitcoin's volume in total. This alone is enough to be hoarding your Steem Power as these are mostly Chinese and Korean investors driving up EOS price. Many of them are just learning about Steemit through buying EOS this week. Get ready. When the pump starts it will be very intense like what we are seeing in EOS and ETH just a few months ago.
Reason #3
Valuation (get ahead of the curve)
Steem is currently valued at #16 on CMC with a market cap of $388 million. While Steem recently touched highs at $2.80 from a .07 cents low in March. Currently at $1.64 this shows a healthy correction/consolidation and not a crash back down. Now is the perfect time to be accumulating Steem.
Keep in mind Steem has the highest amount of users behind Bitcoin and Ethereum with transactional volumes on Steem blockchain passing 700k, making Steem the #1 blockchain in world for daily number of transactions. All this means Steem is incredibly undervalued and should be sitting in top 5 crypto currencies now
Lets take for example ETC that has hardly any transactional volume or any Dapp eco-system sitting at #5 with $1.7 Billion market cap. Compare Steem adoption to that and you see very fast where we are headed and much much further when the market finally realizes how great of a deal Steem is.
Reason #4
Steem was first mover in Social Blockchains.
Just as Bitcoin has dominated the market being the world's first peer to peer digital currency, so does Steem have the same advantage with decentralized Social Media. As with any first mover network effects are strong.
What does this mean longterm for Steem? This means Steem carries a big advantage over new incumbents like Ethereum based Akasha. They will have to develop there user base up like Steem and that takes time. Steem already has a proven product that is highly scalable. It could be another year or two before Ethereum gets Casper and sharding for high scalability like Steem can already do. I am not sure how the user experience will be on Akasha but my guess is probably not so well since it runs on top of Ethereum. With a Social DAPP you need high performance right off the bat. Imgine waiting a few minutes to get your Steem upvote confirmed and paying 10 cents to do it? Its different if you wanna do a service on lets say an Ethereum DAPP like Swarm City. For example, you paying for a ride share like Uber, you just need one transaction and you are finished.
Reason #5
Steem is coming out of Beta.
If you follow Steem in github you can see beta has been removed. Also, the team has talked about talking it out of beta once the time is right. The next step is taking Steem to market.
Yes, that's right Steem is highest transactional blockchain in world with the third largest amount of users of all cryptos. All this achieved while still in beta.
This wraps up my 5 top reasons why Steem is highly undervalued.
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Also, I wanted to explain what the picture means above "you are here".
This is a classic S-curve. All tech stocks like Facebook and Twitter went through this phases of growth. I currently have collected enough data and evidence that leads me to believe Steem is currently in the point just before exponential growth happens. This right before you see the vertical line in chart. This line in tech stocks typically last about 8 years after critical mass point is hit and just about where I think we are now with Steem.
Have a great day Steemians! Follow me for new upcoming post about investing into the crypto space. I constantly make comments btw. Hedge-x