Steem price experienced a 50 percent rally after market research firm Weiss Ratings assigned Steem a B- grade, making it one of only five cryptocurrencies to achieve a rating higher than a C+ and ranking it ahead of Bitcoin.
Steem, the blockchain-based social media platform co-founded by serial entrepreneur Dan Larimer, had a relatively quiet 2017. Like most cryptocurrencies, Steem experienced significant appreciation throughout the year, but it largely lagged the market index during the fourth quarter — until December, that is.
During the final month of the year, the Steem price exploded, leaping from $1 on Dec. 1 to a new all-time high of $7.31 on Jan. 3, fueled largely by heavy trading volume in South Korea. The rally was as unsustainable as it was inexplicable, and by Jan. 17 the Steem price had declined to $2.89.
This week, however, the Steem price made a renewed push, and on Thursday it rose 50 percent in just 24 hours to reach $6.51 on Bittrex, which provides the token with a $1.6 billion market cap.
One slightly concerning factor is that more than 87 percent of Steem’s daily trading volume is concentrated on a single trading platform: South Korean cryptocurrency exchange Upbit. While one never wants to see trading volume centralized on a single exchange or in a single market, this is especially true of South Korea, given that regulators have wavered in their stance toward the country’s booming cryptocurrency markets.
The Steem price’s current rally appears to be linked to the publication of the “Weiss Report.” Earlier this week, Weiss Ratings released its cryptocurrency grades, which it says are the first ever given by a rating agency. The ratings, which quickly leaked online, have been widely panned by cryptocurrency insiders.
Bitcoin, for instance, received just a C+, leading Charles Hoskinson — a co-founder of both Ethereum and Cardano — to say that the report has “some screws loose.”
But although the report received mainstream ridicule, it proved to be bullish for Steem, which was one of only five cryptocurrencies to receive at least a B- grade. Of this exclusive group — which also included Ethereum, Cardano, EOS, and NEO — Steem is the only cryptocurrency that is not currently one of the 10 largest cryptocurrencies, as measured by market cap.
Consequently, the Weiss ratings provided Steem with unusual media exposure and gave it the appearance of an undervalued commodity, leading to its mid-week surge.
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Last modified: March 4, 2021 5:03 PM