Why Being the Base Pair is Good for Steem (Because of SMTs)

in hive-167922 •  5 months ago 

I think one of the strengths that BTC has is it's always a base pair on exchanges. It's also what, in my opinion, helps to keep Ethereum as the crypto with the second highest market cap as it's usually a base pair as well on most exchanges.

With the creation of Steem-Engine and the continual development of SMTs will help drive the demand of Steem since it will be the past pair for all those new tokens that are created. It would even be nice to see other exchanges adding these tokens and Steem as a base pair on their exchange. I think the Steem Leo Dex is just the beginning.

Coal on Runescape

This is what helped me make so much money on Runescape. You see once you got above Iron in smithing, it required you to combine some amount of coal to take the ore and turn it into a bar. To create the most valuable bar Runite, it required 8 coal.

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Old School Runescape Wiki

This created quite the demand for coal, that was relatively hard to mine and took a while for the ore to replenish making it somewhat rare.

I wanted a better pickaxe and soon figured out that people were constantly looking to buy coal in the cities to smith into whatever bar they were wanting to make, so it was pretty profitable for me to mine coal and then sell it until I had enough gold to buy whatever pickaxe upgrade I was wanting to buy.

After a while of doing this I figured out I could sell coal pretty easily for 30 gold apiece, so when I saw someone wanting to buy for 20 or 25 gold a piece I would just wait or transfer to a different server. Eventually, this got me thinking if people are asking to buy for 20 or 25 gold a piece for coal was anyone actually selling for that price.

I decided to spend some time and use some of my money I made from selling coal to sit in the city for a few minutes when I needed a break from mining to see if I could buy coal for cheap to resell it at some point. It wasn't long where I figured out I could buy some coal for 20 - 25 gold apiece hold on to it for a bit or transfer servers and then sell it for 30 - 35 apiece to someone else.

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Source

It wasn't long until the only reason I was still mining was to kill time between my sales and gain some mining experience as I could usually buy more coal then people had for sale and I could sell more coal then people could afford to buy because I had millions of both.

Coal being that "base pair" on the game always had people who were buying and selling and even though it wasn't the most expensive ore in the game to buy and sell, it was the most profitable for me to buy and sell.

Steem as the Base Pair

I think this will have the same effect on Steem on the market. It may not be the most costly to crypto to buy and sell, but for those who know the market, it could be the most profitable, especially for those that will be able to understand the market.

For those who are patient, they will be able to slowly accumulate Steem at prices they know are good. Then someone might see an SMT they want to buy and decide they need a lot or a little Steem to buy it and I can be that person to provide quick access to Steem for a premium.

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Source

Until there is an opportunity for people to use fiat or even Bitcoin to directly by SMTs or Steem Engine tokens, it will always help to drive people to be buying and selling Steem which will allow profits to be made for people who can see the opportunities that present themselves either for the short or the long term.

What Other Opportunities

That's just one way I think SMTs will and already do help to create value for Steem. What are some ways that you think SMTs will or won't help create value for Steem?

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I felt for a long time that the introduction of SMTs would drive demand for STEEM way up (along with the RC pool).

Most are overlooking the fact that STEEM is the base pair. That means it is required for liquidity. That is where the demand comes from. Every SMT that one received in his or her wallet that is not desired means that STEEM is. Those looking to sell are in effect saying they want STEEM.

I also believe we will see huge gains by the SE and SMTs. Why? Because markets arent perfect. Thus, if the price of Steem 10x, a SE token should be worth 90% less. I doubt we see this. The price of STEEM, for example, could triple in a month and I dont think that would affect the price of LEO.

This is where some outsized gains are going to be realized.

I don't think the price of Steem going up would have no effect on the price of SE tokens. I think a rising tide raises all ships.

However, I agree I don't think a 3x in Steem price will caues a 3x in SE tokens, maybe just a 2x price movement.

Then again we could all be wrong and the next time the Steem price starts to raise it could cause an SMT cycle where people are wanting to take profits in other coins on the platform that haven't pumped them yet.

My only fear is that the people driving these communities don't burn out. As important as creating tokens of value is if they disappear like the creators of partiko then all that value and work could disappear quickly. It will be nice to see community members take over more and more activities within these communities and is one area where I think PAL an advantage. May not have the economics behind it like LEO, but has the sticking power being tied to MSP.

I've been enjoying all the engagement on twitter thanks to #posh and #oc rules. If you don't feel this is a worthy of a like on Steem feel free to provide a like on twitter to help improve my engagement on there!

I did a post today where I showed a Mt Dew bottle where Pepsi is doing a loyalty token called Pepcoin or some such. Anyways wouldnt it be something if we landed an elephant like that! Seems like it could be a compelling choice to consider Steem once we have communities and SMTs