Like any pyramid, it will fail at some point, and there will be again bad press about the technology. so bad!!!

As the founder of Steem said...

The question is how sustainable is the business model?

In contrast to tokens like BTC that aim to be adopted as a form of limited money which are also reliant on some new demand to offset new supply like Gold, Steem is a company share, with VERY high inflation & a large percentage controlled by the founders. Unfortunately the company Steemit has no actual revenue source. It is paying it's expenses (New Steemit users & their content) by diluting Steem holders at >0.2% daily. In that sense it's a pyramid scheme, in that it is a company that sells no product or services and is reliant on new Steem speculators to pay out new users and content rewards.

Once speculators realise this, demand should decline and at some point it is mathematically inevitable anyway...
Because at >0.2% a day you'd have to believe Steem will increase by >6% a month to hold it. (Steem is effectively charging >10X the rate speculators are willing to borrow at the majority of the time on Polo https://poloniex.com/lending#BTC)

(This is also in contrast to the Synereo model which is sustainable because the incomes and rewards are sourced from advertising revenue.)

Synereo on the other hand for example does have a business model. A social media site, where the majority of advertising revenue goes to the users in return for consuming advertising content. So that has the potential to be a lucrative, sustainable business model and Facebook killer.

The minute speculators stop buying Steem it may collapse because there is no business model or revenue source only the hope speculators will value a site attracting users and not use common sense.