A little less than a month ago I wrote a post entitled Defending The Quarter.
The premise of this post was pretty simple: if Hive were to dip down to 25 cents we should defend that level. The current price at that time (Dec 21, 2022) was 29 cents. Little did I know how well that post was going to age, as a week later we dipped down to 25 cents, and now only a few weeks after that we've rebounded all the way up to 35 cents (with a local high of 37 cents at the peak). That's a 40% rebound in just two weeks. Pretty wild, as calling the bottom is no easy feat. Chalk it up to dumb luck really.
And also I'm not saying it's a good thing that we are up 40% in such a short period of time. Hive's pumps and dumps are indicative of high volatility, low liquidity, and poor discipline from those trading it. When it comes to treating cryptocurrency as such [currency], volatility is a particularly bad thing to have. Luckily HBD is maintaining the peg quite well during all of this, so we are still able to piggyback off of the fiat system in a relatively efficient manner. Perhaps one day we can break away from this trend and create a system that has its own stability, but not today (not even within 5 years most likely).
Certainly the bear market isn't over, and Hive could go lower than 25 cents, but what if it doesn't? Let's take a moment to congratulate the network for how impressive that is. This network has known nothing but 10 cent lows since inception, since before we were even called Hive. Every bear market was accompanied by that dreaded ~10 cent low. In fact, we were even trading within this range in both 2020 and 2021. If we included Steem, we traded in this range during 2016, 2017, and 2019 as well; a common theme. Those were hard times, but it seems like they're in the rearview mirror.
Of course it would make logical sense that Hive would finally increase the floor price by a large factor at some point. If we look at all the gutter trash we had to wade through since the last bear market in 2018, it's quite the miracle that we are even still here. Hive is a prime example how crypto becomes antifragile when the community becomes grizzled and diehard enough. We keep the lights on even if it means taking a loss on the short term. This burden is distributed outward to many individuals, so even if some drop out of the race others will be there to pick up the pieces. Robust decentralization hard at work.
This network has made some legendary progress in the past few years. Every single hardfork has been extremely pro and a huge upgrade. And short of upgrades to the core code, the things being built on top of Hive permissionlessly are also quite impressive. I've got some pretty high hopes for the SPK network being able to incentivize bigger chunks of data being stored on IPFS (like video and whatever else). We are still firmly within a phase that everyone seems to think that infrastructure can scale without incentives and people are just going to provide it for free (most recently NOSTR proves that people still believe this can happen). We have some interesting games being built here, and development of the blogging side continues on as well.
Speaking of scaling:
Any dapp or protocol built on Hive that has success will immediately get funded to the point that the ones who built the thing can move on to another project and try for another scalable dapp built on Hive.
The overhead cost of learning the details of all this tech should not be underestimated. It takes a lot of work to learn how to build on top of any given network. The devs that learn have an incentive to keep building where they are. Switching networks has a lot of friction, and the devs that we capture are quite valuable.
Apparently we even have a rally car?
News to me.
Crazy stuff.
And we continue to work on scaling...
Even though the network has never actually used all its bandwidth. Blocks have never filled up, yet we keep coding on to increase the efficiency of this platform. With one-block-irreversibility in play that's quite the combination. Add to that our plan to outsource smart-contracts to the second layer and we really have something that can expand much more quickly than something like Ethereum. In addition our token distribution is already superior to the #2 coin by market cap. They're new to proof-of-stake, while we've been living it since day one. Our ability to navigate this environment is simply better than those with less: experience, time, and distribution mechanics.
Conclusion
If Hive can hold the line and stay above the new 25 cents floor, that would be a huge win for the network. I'll be the first to admit that during the middle of the bull run I had much higher hopes, with 80 cents being the new floor, and then 40 cents after that failed. Unfortunately the bear market is a cruel mistress, but yet even 25 cents is a much more solid floor than 10, and would mark a +150% increase from the last level we got stuck at for so many years in a row. Now that we have a 40% buffer between us and the local low, it seems more likely than ever that we may be able to stem the bleeding as we come out of the standard year-long retracement we get every four years.
It's good to remember that development always happens at a snail's pace, but then a couple years goes by and we look back and see how far we've actually come. People have a tendency to overestimate what they can get done in a year and underestimate what they can get done in five. Considering the Hive brand hasn't even existed for five years, I'd say we have quite a bit to look forward to over the coming years. Keep stacking.