Quote from: bytemaster on April 19, 2016, 06:27:49 PM

https://steemit.com/@steemit => 12,928,066.340 STEEM
With a total current supply of 22,214,424.000 STEEM means Steemit has 58% and the rest is held by community members. So even if you wanted to factor out Steem held by Steemit, the current methodology of factoring out all vesting *users* is wrong.

I think in addition to that the CEO, yourself and some other key parties also have a decent size amount of what I would call semi-privately mined STEEM. I think those might be factored out under the current methodology too.

Quote from: bytemaster on April 19, 2016, 06:27:49 PM

If you create 10 billion shares, and sell 1 of them for $1.00 back and forth with yourself to generate millions in daily volume, it obviously doesn't create a coin that should be listed above Bitcoin. Which is what the scammers would attempt to do.

It would cost too much in trading fees to generate millions in daily volume. So you'd have to use a compromised exchange or an exchange with no trading fees. CMC already partly addresses that by listing but not including volume from exchanges with no trading fees http://coinmarketcap.com/currencies/bitcoin/#markets

Quote from: bytemaster on April 19, 2016, 06:27:49 PM

So the real question is whether or not there exists a legitimate market with actual trades with many independent individuals valuing the coin or whether it is a closed market with a bunch of sock puppets. In effect, are all trades in the token based upon arms-length fair valuation / speculation or are the trades simply moving money from one pocket to another.

At a certain point it becomes obvious the market is pricing in the full supply rather than just part of it. Does it really make sense that someone buying STEEM, then converting it to VESTS should REDUCE the market cap?

Soon the ridiculousness of the current method will become apparent when Steem Backed Dollars will have a higher market-cap than the STEEM that is backing it.

So I think there is a case to be made that a chain is either "public" or "private" with a value set by the "market" or by "decree". It is easy enough to tell the difference.

I agree that the market, as with other crypto, is pricing in some of the illiquid supply &/or supply held by founders into the true valuation & STEEM is effectively being valued much higher than the available supply metric suggests. However if CMC included all founder and illiquid shares as 'available supply', then many other cryptos would argue for similar treatment & create what I would consider heavily distorted valuations.

Quote

Does it really make sense that someone buying STEEM, then converting it to VESTS should REDUCE the market cap

It creates a situation where the valuation could be easily distorted/manipulated when shares are removed from easily available supply. They could for example receive an artificially high valuation due to scarcity as you seem to acknowledge...

Quote from: xeroc on April 07, 2016, 01:11:14 PM

Quote from: bytemaster on April 07, 2016, 12:37:10 PM

Only 0.47% of STEEM is liquid in individual accounts, this is going to make the pump on CMC legend... wait-for-it... dary!

I...

https://bitsharestalk.org/index.php/topic,22125.msg288854.html#msg288854

I'm not a fan of STEEM so perhaps I'm unfairly bias, maybe CMC will agree with you on some of those points &/or find some middle ground.