As a user of Steemit and an investor in the STEEM cryptocurrency, I was shocked to find that 70% of the Steemit staff was released from duty recently. Steemit has been in operation since 2016, and I have been a member for 6 months. I joined the network during the cryptocurrency bear market, and dumped my underperforming cryptocurrency assets into the platform. The plummet of STEEM coin from $1.5 to $0.35 has been troubling, but not out of bounds in the highly volatile asset market that is cryptocurrency. The fall of STEEM and the impact to Steemit.com shows the risk of cryptocurrency investment, and what one must do to reduce their risk during bear markets.
STEEM is a cryptocurrency that has maintained a market position within the top 50 cryptocurrencies, has functioned as the largest decentralized application with over 1-million user accounts and is recognized outside of the cryptocurrency community. Dan Larimer and Ned Scott have led the startup project with their delegated proof of stake and zero-fee network. STEEM is listed and traded on top exchanges including Binance and Bittrex and Smart Media Tokens (SMT) will be released in the near future which have the functionality of Ethereum ERC20 tokens with customizable usage.
The message is clear from this shocking and worrisome head-count reduction at the top-50 marketcap cryptocurrency that is STEEM at Steemit, and that is any cryptocurrency project is at risk during this prolonged bear market. EOS, Ethereum and even Bitcoin-based projects are not immune from market conditions and investors must spread out their money between projects with the expectation of ups and downs.
STEEM coin rose 12% today (11/29), the day after the devastating news of yesterday. Realize that this news is a “reorganization” and not bankruptcy. How many employees were actually laid off? Ned has not said. In addition, we have to look at the proposed cost-cutting iniatives including AWS usage, pitchforking the network, and node-related efficiency measures. Steemit is not Bitcoinnect, and the STEEM coin is a decentralized asset. There is no reason to abandon Steemit, rather it is prudent to remain cautious and alert to news. My advice is to hold your STEEM and use the platform as you always have.