What If Steem Moons?

If you’ve been on Steemit for a while, you’ve seen more than a few people predicting $100 Steem. Sure, that might at first seem wildly optimistic but if there’s a successful rollout of Smart Media Tokens and SMT’s really take off, $100 might prove to be a lowball guesstimate. There sure does seem to be a lot of new development; it’s now a rare day when my Feed doesn’t include at least one post about a new dev team that I hadn’t already heard about.

Others here on Steemit have predictions for eventual four-digit Steem values, albeit without specific timeframes. @taskmaster4450 also thinks that 1,000 Steem Power will, for most who get to that point, prove to be life-changing money. Tangentially related, he and @phoneinf both talk a lot about the coming Age of Abundance. @phoneinf recently posted a D.Tube video suggesting that the technology implicit in an Age of Abundance might mean that financial independence could require much less money than you might think.

My mind wandered off into the weeds and I started wondering what $100 Steem might mean in terms of an income stream. 1,000 SP times $100 Steem is obviously $100,000 but the potential ongoing income from such an account is harder to guesstimate. Several people have done calculations showing that a 100% self-upvoting strategy using a bot to post and self-upvote every 2.4 hours can, at least in theory, garner a 35% annual rate of return. So, ballparkish, a 1KSP account can earn about 1 Steem Power per day on autopilot. Not the life I’d choose to live.

But I started wondering about what people with 1KSP accounts who aren’t self-voting at anywhere near that rate are earning in the here and now. SteemWhales.com has gone into limbo, but you can use steemdb.com to sort members by Steem Power. I selected a few people who had just over 1,000 Steem Power. This is not remotely statistically valid, my sample size is way too small. SteemDB sorts by vests rather than by Steem Power but, after converting, it becomes apparent that the site currently has about 6,600 members who have at least 1,000 SP in their accounts. I only looked at a small sample and results were all over the map. Some of the more active ones were making on the order of 30 Steem/SP a week, others were making only 5 or 6 Steem/SP a week in author rewards. For curation, active 1K Steemians were making 1.5-1.8 SP per week.

The accounts I looked at seem to suggest that it’s not implausible to assume that for an active 1KSP account that’s posting, commenting, and curating, it’s not that hard to be earning six or eight Steem Power a week in the current environment.

Let’s assume for the moment that the $100 Steem price a year or two from now is valid. Let’s also assume that to get to that point, the number of users on the site would need to increase dramatically over that time (probably quite likely as HF20 should make signing up for Steemit far easier and faster than it was for those of us here now). The total amount of Steem added to the ecosystem is growing by only about 8.9% a year, and that percentage is decreasing. Many more members competing for a reward pool that’s only a bit larger may mean that rewards may be harder to come by but that those you do earn may be far more valuable than they are now. So a 1,000 SP account might only be earning one or two Steem a week in rewards, but that could translate into a couple hundred dollars. In such a scenario, similar active accounts might be making a 10% annual rate of return. Even if membership skyrocketed, the related rise in the demand for Steem (for instance from entities issuing Smart Media Tokens who need Steem Power for bandwidth purposes) could mean that earning an annual rate of return of just a few percent would translate into a significant earnings stream. And don’t forget that your SP increases simply by being held as SP rather than as liquid Steem. Maybe not a lot, but with a high enough Steem price, potentially having a big effect on an income stream.

Okay, so I have no way to project any firm numbers. But what I’m suggesting is that acquiring even relatively modest amounts of Steem Power now when it’s relatively easy to do so has the potential to turn into a significant source of income in years to come.

Disclaimer: This should not be construed as financial advice. I am not a registered financial advisor; I don't even play one on TV. Do your own due diligence. Batteries not included. Objects may be larger than they appear in mirror. Some assembly required. Do not taunt Happy Fun Ball.

Pixabay image at the start of the post, divider by @atopy