I think in general we can assume that as Steem gains market share the average return will regress toward the average return of global markets, usually estimated at about 4% annually. That will probably happen long before $1000 Steem.
I think in general we can assume that as Steem gains market share the average return will regress toward the average return of global markets, usually estimated at about 4% annually. That will probably happen long before $1000 Steem.
Do we have a record of how many vests there have been over time?
There are 391,303,782,387 now. Say @joesomebody currently has 39MVests. Since Joe controls 1/10,000 of all vests he would on average earn 1/10,000th of all Steem produced per day, minus what witnesses get. So about 6 Steem per day based on holding about 19K SP right now. So Joe’s making about 11-12% APR just by being average. He’s posting, commenting, and curating, earning a bit here and there from all three activities.
Unless he powers down and instead reinvests his earnings into SP along the way, several years from now he will likely still control roughly 1/10,000th of outstanding vests (since the number of Steem per MVest is constantly going up but SP holders get an inflation adjustment continuously). The Steem inflation rate will be somewhat lower then, but Joe would still be earning, on average, 1/10,000th of Steem being produced. How does that 11-12% APR drop to 4% if he still has a “claim” on the same percentage of Steem being produced?
Currently we get a weird boost due to nobody really valuing Steem for itself, so the inflation rate is only marginally relevant to the price, but in a mass-adoption scenario this won't be true. A 9% inflation rate isn't sustainable against the global market. If we presume mass adoption happens then if the rate is sustained the price of Steem will reduce against other currencies concomitantly.
Also I suspect that as Steem increases in value there will be a higher percentage of it staked and thus more vests. Currently 28.5% of Steem is unstaked.
Well, Steem’s inflation rate continues to fall and at a slower rate than accounts are growing. The real test though will be if/when Steem blockchain usage goes parabolic.
Agreed. The amount of liquid Steem available might drop significantly at the same time that demand for it is accelerating.