Steem is both an altcoin and a blockchain-based social media platform where anyone in any part of the world can earn rewards.
It was created on March 24, 2016, by Ned Scott and the blockchain developer Dan Larimer.
Steem started out as the cryptocurrency on the Steemit platform that rewards users for community building through the upvoting and the posting of meaningful content.
The Steemit platform, built atop the Steem blockchain, is a social media network that seeks to be a source of community-driven curated content such as news, Q & A, and job boards.
The more value a particular piece of content is able to deliver across a greater number of people, the greater the reward received by the creator.
Steemit users can cast votes to create a hierarchy of content. The higher the upvote count received on a content piece, the more Steem is earned by its publisher.
Steemit’s meritocratic system also enables users that hold more currency to cast more meaningful, greater influence votes.
It also powers real applications via social apps like Steemit, eSteem, Steem Monster, etc.
Steem blockchain has 3 different types of cryptocurrencies, which I discussed below.
The Steem Blockchain contains three unique tokens with 3 different attributes.
Whether you want to increase your social app influence, HODL wisely, or zero in on cash, there’s a Steem token for you.
Steem coin is the basic cryptocurrency of the Steemit network, with the other two cryptocurrencies (Steem Dollars and Steem Power) depending on it.
Since Steem was released in 2016, the supply of Steem has automatically increased by 100% each year.
The Steemit platform schedules witnesses to produce a new block every 3 seconds.
But what is Steem Witness all about?
The Steem blockchain requires a set of people to create blocks using a consensus mechanism called delegated Proof of Stake, or DPOS.
The community elects ‘witnesses’ to act as the network’s block producers and governance body. Each account can vote for up to 30 witnesses.
There are 20 full-time witnesses, producing a block every 63-second round.
A 21st position is shared by the backup witnesses, who are scheduled proportionally to the amount of stake-weighted community approval they have.
Witnesses are compensated with Steem Power for each block they create.
With the Steem blockchain, only 10% of the new coins are paid to block producers (witnesses).
The other 90% of new STEEM coins are awarded to content producers, curators, and Steem Power holders.
On coinmarketcap.com, it ranks number 75 with a market capitalization value of $57,396,938 and a price of $0.160347 (as of 20th Jan. 2020).
Since more Steem coins are created every day, I do not recommend you hold them for a long period of time.
It should instead be converted into Steem Dollars, Steem Power, or some other cryptocurrencies like Bitcoin or Litecoin.
2. Steem Power(SP)
Steem Power (SP) is a token that symbolizes how much of an influence you have on the Steemit platform. The more SP you have, the more power you have.
Mere holding Steemit Power gives weight to your voting in a 1:1 ratio. For example, if you hold 300 SP and vote for a post, then your vote is 30 times more influential than that of someone who holds 10 SP.
SP is an important feature of the Steemit platform because your reward is directly related to it; you cannot even vote at all if you don’t have any Steem Power.
A post or comment will receive more compensation when upvoted by someone with more power (SPs).
Other interesting facts to know about SPs include:
- It is considered a long-term investment. You cannot actually sell it until you have been holding it for at least 13 weeks.
- 50% of payments sent to contributors are made in SP.
- SP cannot be traded on exchanges; unlike the other 2 tokens on Steemit.
- You can “power up” by increasing your SP holding or “power down” by cashing it out (exchanging it for Steem coin) all for free.
3. Steem Dollars(SBD)
Steem Dollars is another token of the Steem blockchain that is considered to be a more stable one.
It is intended to be valued at a ratio of 1:1 against the US dollar. This simply means that 1 SBD should be equal to the amount of Steem that can be bought with 1 USD.
So because Steem Dollars are intended to be stable, 50% of the payment to creators and curators on Steemit is processed in SBD to protect them against the fluctuations of the Steem cryptocurrency.
Steem Dollars can also be traded on several exchanges, or you can cash out your SBD by converting it to Steem or Bitcoin and then converting it to fiat currency.
**There is also the Smart Media Token(SMT) that is yet to be launched.
A Smart Media Token (SMT) is a native digital asset on the Steem blockchain that can be quickly launched by anyone to help monetize online content and create incentives to encourage desired user behaviour.
They are like Ethereum’s ERC-20 tokens, but with certain built-in ‘Proof-of-Brain’ properties and a token distribution reward system designed specifically for digital content businesses.
SMTs are planned to be launched in the year 2020!
More information can be found on the SMTs website: smt.steem.io.
That’s it for Steem basics and its tokens. Let’s move on now to Steem’s top apps.