As I have mentioned before, Investing into Steem is like investing into an index fund as it will benefit from any value-adding development that takes place anywhere on the blockchain. This is something that I find highly intriguing as an investment vehicle concept, but there is more to it than just investing into all the applications, known or not.
Me quoting a quote taken from one of my posts, and then quoting the reply to that quote taken. Meta.
If the gold rush analogy holds up, we should remember that those who did best weren’t the ones digging with picks and shovels. It was the ones who sold the picks and shovels. The ones who provided the infrastructure. The stakeholders. @preparedwombat
A couple days ago I wrote a post looking at the central point of failure in many platforms being the need for the holding entity being very resource top-heavy and therefore requiring profits to operate and satisfy shareholders. This is a point of failure that is far less on Steem due to the decentralized nature, the lack of central ownership requiring salary and resources and the very diverse set of owners who are distributed globally and all have different motivations and incentives instead of profit at any cost. However, what those centralized platforms have going for them is that they have a distribution platform that requires very little input once up and running but can take a middleman cut from those who use it in multiple ways.
Looking at the Apple and Google markets that take a 30% cut from every application sold on their platform, this allows them to profit without having to invest at all into the development process. With so many application companies leveraging their distribution platform, they don't care much how any individual application profits and whether an app takes a million dollars to develop and sells 100 dollars worth, or takes 100 dollars to develop and sells a million, they profit either way.
Distribution matters a great deal and no matter how good an application is, if no one sees it or can get their hands on it, it cannot get marketplace traction - which is why the platforms have such a stranglehold over the developers. But this is not the only reason.
Not only do the Google and Apple marketplaces provide a distribution hub for applications that they profit from, both also create software and hardware that give those applications a home to work upon, another type of platform. Instagram is pretty useless without a smart phone. This means that they have locked up much of the mobile application ecosystem and market potential in a duopoly that owns the distribution and the use case.
Like @preparedwombat said,
those who did best weren’t the ones digging with picks and shovels. It was the ones who sold the picks and shovels. The ones who provided the infrastructure. The stakeholders.
Are you seeing the potential of Steem yet?
Maybe not. But I do. Steem has the potential to become one of the application markets and one that is able to provide integrated blockchained economic systems that are customizable in a near endless set of configurations that can be designed to suit specific use cases. No special hardware is needed from a user perspective - just access to the internet.
All an application or community need do is integrate Steem into their UI, even if the rest of their application is not some immutable and blockchained experience. The economics of the application will be of course because that will be managed and handled on the Steem blockchain. The coding required to do this is minimal.
What this means for stakeholders in Steem is that while they are investing into every application on and to come in Steem without investing directly into any, they are also going to benefit as owners of the distribution platform and this is in more ways than just the sale of the application, it is in every ongoing growth in any individual application. The better an application does, the better Steem as a whole does, and there can be thousands of applications of varying degrees of success, simultaneously adding economic mass to the blockchain to continuously make the value proposition weightier.
Not only this, with no central hub of top-heavy shareholders and boards of directors in charge of the platform, all wealth generated goes back to the stakeholders and into the ecosystem itself to be added to provide more stability through stake, used to distribute more coins to create more owners and support users and application and community owners.
Because of the way Steem operates, all stakeholders have many options and levels of activity in how they approach their investment, and as such users have many options in which to attract value to themselves to. With SMTs, this will increase exponentially and not only increase the network spread, but add layers of networks on top of the spreading existing infrastructure.
As I have said before, for Steem to do very well, it doesn't need hundreds of millions of users, although it can scale out to that later. Tens of millions will be plenty to add masses of value, and if that happens, it will attract many more in organically. With the lack of organizational hierarchy and resource requirement, Steem never need act as a middleman that skims value from the users, but instead stakeholders earn value by empowering the user base through providing a space to develop, interact and consume. And, those same stakeholders can actively use their stake to empower those users directly in multiple ways.
Because there are direct line relationships within the marketplace, Steem can continually undercut centralized competition and as the space grows and crypto/ blockchain becomes ubiquitous, it can bring in increasing amounts of economic value and spread it back out in a handshake between creator and consumer, and back again to create a much more complete marketplace.
What I see happening in the future is that the decentralized marketplaces for applications that can also provide a range of economic potentials that do not discriminate based on borders, will continually chip away at and undermine their centralized and much slower cousins. This will cause a lot of disruption and engage protectionist actions because while it undermines the likes of Google, it also undermines the likes of the government that benefits from the ecosystem Google maintains.
It is going to get very interesting, especially if the people of the world finally say that enough is enough and make moves to take back control of the lives they have so far, increasingly given up in the name of convenience and entertainment - that has cost them their very economic viability. Funnily enough, we can gain back our economic independence through the very same measures, as long as we choose to support each other over entities that do not draw breath - but suck the majority of value that transacts across our world.
Our world is funny as we think they have the power in it without recognizing we actually hold all the cards. Time to own the network of relationships, instead of letting others manage who we are allowed to speak to.
[ a Steem original ]