We are seeing something very interesting taking place.
Each of us on Steem, as long as we power something up and delegate it, are venture capitalists. We are part of the world of funding. It might seem strange but that is exactly what we are doing.
When we delegate our SP, we are essentially supporting that entity. Our delegation is making it that much more powerful while enabling it to grow the returns. This is true for a project like an application or an individual. If we look at an individual as one who is looking to build his/her enterprise, the personal account on Steem, it makes a lot more sense.
The act of delegating enables projects to grow. Part of this ecosystem is the upvote economy. Since upvotes have monetary value, we are seeing a wealth creation mechanism in play. Often, we receive rewards for that delegation in the form of another currency that was created by someone. This is a growth process where both parties come out ahead.
With the introduction of delegation (staking) on PALnet, we are seeing another layer of funding possible. There are hundreds of thousands of PAL tokens that are staked by individuals that could be used by others for their projects. Just like SP is heavily sought after, I envision the same will hold true for PAL stake.
This is what happens with an abundance economy as opposed to one that is developed around scarcity. Since people have the ability to generate money in many different forms, they find places to send it. Since commerce, at this point, is rather limited, we essentially use what money is on here for the expansion of others (and ourselves). Basically people are forced to invest since spending is hard.
Due to the fact we are still operating in the fiat controlled world, and have bills to pay, we are aware that it is difficult to survive simply on one's token and upvotes. There has to be something else that bridges it to the fiat world and brings in money from there. That said, as more people, globally, get crypto in their wallets, this will shift.
The wonderful thing about abundance it actually puts a ceiling on consumption. Let us use video as an example. A couple decades back, video stores were huge. We would pay a few dollars to rent a video for a night or two. Today, with sites such as Netflix and YouTube, we can watch videos around the clock. The question is how many of us actually do that? How often have you gone to Netflix and realized there was nothing that interested you?
I foresee the same thing happening with money. As abundance grows on here, people are going to see the values of their accounts skyrocket. Each day, people are earning more tokens across the board. This is going to have an impact on their wealth.
Being reared in the scarcity world, many of us get smitten with the Lambos. Yet reality is that does not create any more happiness. Studies over the last decade conclude that the $70,000 in yearly income is the cap level of happiness impact. Each increase in income has a correlation to happiness up to $70K. After that, the monetary gains have a diminishing return in terms of happiness.
What does this mean?
If things pan out as I expect, and we see the growth continue on an exponential scale, there will be a ton of people who far exceed this level. This means that there is a lot of excess money floating around. Ultimately, a lot of this is going to find its way into the hands of others in the form of funding. Essentially, my wealth can be used to benefit others.
Let us look at Steem Power. The SP that I hold relates to my voting power. I get 10 upvotes per day at 100%. Each upvote as a certain value to it thus my total value is the upvote times 10.
I have two choices with my votes. I can choose to use them or lose them. If I do not vote, my SP generates nothing on the day. I can not go back and recoup it, thus it is gone forever. Naturally, the reward is still distributed, absence my votes, since the pool is divided up based only on the upvotes given by the community in total, not the potential.
There is also the option of delegating my SP. This means the voting power is transferred to someone else. Under this scenario, the proceeds from said vote is of benefit to another (others). I do not get anything from the vote. It is here where we see accounts grow.
This is how funding works. It is a simple model that spread money to others. Sure there are some who self vote themselves but that is not the majority. Each day. tens of thousands of different accounts are getting rewards for their activity. With each passing year, more STEEM is distributed in this fashion. It is why accounts that keep powering up cannot help but to grow. The system keeps delivering payouts.
Adding layer two solutions only compounds this entire process. PAL has a value of, the last time I checked, around 17 cents. Here again, by delegating PAL stake to other enterprises, either individual or applications, we are helping to fund that operation. Over time, just like we witnessed with Steem, accounts will grow.
Of course, the entire system compounds if we follow the circular nature. As payouts come in and accounts grow, there is more money to fund other projects, either through delegation or an upvote. We can also opt to convert some of our tokens into others that we view as more promising projects. No longer does one have to only dip into the fiat account to invest in a token. One might have resource through what was paid out in this ecosystem.
Over time, we could see this grow to mammoth proportions. What if we wanted to fund a large project of global interest. With enough wealth on here, we could do that. At some point, an account with enough SP, PAL Stake, or whatever other delegated tokens there are, could generate hundreds of thousands of dollars each week simply through upvoting.
I wrote about stackin yesterday and how I see applications and tokens being stacked upon each other for additional payouts. PAL shows how we can get rewarded a second time for the same content. Now I am interested in a project that is looking into enabling people to get paid a third way. It is all so exciting.
Thus, I find it imperative upon everyone to look at growing his or her account. Why? Certainly I would love for all, including myself, to have true financial freedom. However, beyond that, it is up to us to look at how we can grow the totality of wealth on here. It is by delegating and investing in others that we will see things grow.
Steem is an economic system. In all systems, there needs to be funding to grow. Traditionally, this came from banks and speculators. Crypto-Economics also requires funding mechanisms although it offers many different ways to do it. Just using the upvote as an example, we see how powerful this can be.
As the totality of the wealth on here expands, we are only going to see an acceleration of things as that money is placed into the hands of people building and developing more.
We are now a funding epicenter.
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