Steem, a cryptocurrency used to power the Steem blockchain and Steemit blogging platform, has just pumped by more than 200% in the last day.
Steem started out at $0.124 yesterday and spiked to as high as $0.412 before falling back to its current value of $0.354—this represents a maximum pump of 232% in less than a day. This dramatic growth positions Steem as the 40th largest cryptocurrency by market capitalization—up from 79th at the start of the week.
It isn't just its value that saw a dramatic increase since yesterday. Steem's trade volume witnessed more than 100-fold growth at the same time, climbing from under $1 million changing hands daily yesterday to almost $140 million changing hands today. This represents the highest daily trading volume of Steem since April 2018.
Like many significant market movements, there is a clear reason behind Steem's recent market movements.
Last month, Tron CEO Justin Sun purchased Steemit Inc., the company behind the popular Steemit blogging platform. As part of the acquisition, Sun gained control over Steemit and received a large chunk of Steem tokens to boot.
Tron CEO Justin Sun. Image: Tron Foundation
Those in the Steem community were aghast, since the tokens were supposed to be used for continued development of Steemit. They concocted a plan to freeze Sun's coins in order to decide what to do with him. But Sun, in coordination with a number of other notable crypto exchanges, took over the Steem network and blocked the plan.
Then, as Decrypt reported yesterday, the Steem community hatched further plans to create an entirely new blockchain—identical to Steem in every way—but one where Sun's coins are either worthless or put to better use. The idea would leave the old blockchain to die.
Whether the plan has merits or not, it attracted a lot of attention, likely leading to the increased trading volume. But how long will it last?
The views and opinions expressed by the author are for informational purposes only and do not constitute financial, investment, or other advice.