There is a lot of speculation about the price of Steem and I've seen predictions as high as $10 by the end of the year. While I do think Steem price will increase in the near future, I don't see it that high.What follows is a list of reasons for the Steem price evolution medium term. It has taken basically from an interview I did this morning with @badastroza, which will probably go live on his Steemit account in a few days. I think this post could serve as well as a little teaser for that interview, in which I touched quite a lot of sensitive issues about Steem.Without further ado, here are the reasons for the price increase:

1 Scalability issues tracked

The number one issue for Steemit these months was scalability - or how it handled an increased number of users. There are at least two levels: content and technical.By content I understand the degradation of the posts and comments, with a wave of low quality, borderline spam activity, as a result of Steemit being perceived as "blog whatever the shit you want and make a quick buck out of think air". And by technical I understand primarily the dramatic increase in the resources needed to maintain the network, with seed nodes approaching the 100Gb RAM limit very fast.For the content part I don't see an immediate solution, other than ignoring the garbage and being on the lookout for the gold in the dirt. In other words, supporting serious users and letting the freeloaders to use all their energy until they get bored.For the technical part, there is a consistent block of information pointing in the good direction. The core piece is coming from this post, feel free to read more if you're interested.In my humble opinion we may see the growth issues handled in a consistent way in about 3 to 6 months. That will certainly help with the Steem adoption as more and more users will start consuming the platform in better conditions.

2 Arbitrary split of rewards

I've been talking about this for a while and I still think this is probably the bigger growth factor for the Steem technology. It is already used in apps like busy.org, chainbb.com and the mobile app eSteem.This feature allows anybody to create their own content ecosystem on top of the Steemit blockchain and get paid automatically by retaining a percentage of everything that's generated in that ecosystem. We're still at the pioneering level of this, when we can see a bit of resistance from people engaging in these new platforms, mainly because they don't see it "fair" for the founders to "take out 5% of my earnings".This attitude will slowly dissolve during the next months as competition will increase in this sector and as the percentages will become more palatable for the end user.

3 User Issued Assets (UIA) on the Steem blockchain

This was announced a few months ago by @ned and I think it will be a game changer, if we can see it implemented by the end of the year.What that means, in layman terms, is that anybody could build their own token on top of the Steemit platform, just like you can do it now on the Bitshares blockchain. I still don't know details about the implementation and I don't know if there will be more than just UIA and we will also get a virtual machine able to execute smart contracts. But even without smart contracts, the ability to generate tokens on top of the Steemit blockchain will be a key driver to the price.

All in all, I think these features will help Steem gain around $1.5-$2.5 on top of what it is right now. I may even risk to tell that I see Steem between $2.5 and $3.5 by the end of the year.

And here's the reason for a limited increase, or why Steem will never go "to the Moon":

Steem is an inflationary currency

If you don't know, each and every day approximately 43,000 Steem tokens are printed and distributed via the reward pool. That means Steem is an inflationary currency, as opposed to Bitcoin, which is deflationary. We all know that there won't be any more Bitcoin left after we reach the total mineable number (which is 21 millions if I remember well).This specific feature of a currency, deflationary / inflationary, has a significant impact on the price. If the currency is deflationary, the price is bound to grow in time, because there will be less and less of it on the market. Scarcity creates demand.If the currency is inflationary, the price may rise only to the "furthest leaf tolerance". This is a term I just coined, by the way. And by the "furthest leaf tolerance" I mean the person most likely to sell at the market price, knowing there will be more printed the next day. And given the demographics of Steemit, which is probably: "people from all walks of life, with basic writing and interacting skills, looking forward to make some money out of their social media activities", there will be a lot of "furthest leaves" in this tree. In other words, there will be a lot of people willing to sell "early".So, in my understanding, because of the inflationary nature of Steem, as a currency, the incentive to sell, knowing you can get more of that tomorrow, will always be relevant. There are many caveats and edge cases to this, obviously, but the bottom line is that this "feature" may put a stop to the max value. Even inflationary currencies can have a significantly high price, but their own nature - you can get more of it tomorrow - will put a stop to that.So while I do understand Bitcoin predictions in the thousands, I don't see Steem, as a currency, rising more than - probably - hundreds.It's not going to be "the gold of Crypto", but it may as well be "the oxygen money" of crypto, or the token which will always be liquid, available and affordable.I'm looking forward to being proved wrong, by the way.Disclaimer: please be aware that this is not trading advice. I am not qualified to provide that advice and this post is not about that. If you do trade, please make your own do diligence and, at least, trade only what you can afford to lose.