STEEMIT is a social network in witch users create and comment on each others content. Steemit is made of sub-groups that encompass literally thousands of topics.
Content creators writre articles, how-to, and opinion pieces on myriad topics. Users vote on the value of the content by "upvoting" good content and "downvoting" bad content.
This constant content creation leads to excellent articles becoming quickly recognized. That recognition pushes the content up the ranks on search engines like Google, which draws more users to the Steemit platform.
This creates a so-called "virtuous cycle" that seeks to make Steemit a global trusted Source of excellent content.
HOW DOES IT WORK?
Content creators receive monetary rewards for their work when it is "liked" (Steemit uses the term "upvoted"). These rewards vary. They depend on the amount of likes and the quality of the reputation of the peolpe liking the content.
If someone has a high reputation score (all users start out with a reputation score of 25 and it tops at 100), his or her upvote is much more valuable than an upvote from someone with a lower reputation score.
Content creation rewards come in two forms: 50% of the rewards are in the form of a token called Steem Dollars and 50% is in a token called Steem Power.
There are Three tokens that are used on the Steemit network: Steem, Steem Dollars, and Steem Power.
Below, i will explain the difference between the three tokens:
STEEM
Steem is the base currency of the steemit network. Think of it like an inflationary fiat currency. The amount of Steem doubles each year. (Some sources say this might be changing to just 10% inflation per year. But for now, inflation runs at 100%)
STEEM DOLLARS
Steem Dollars are digital tokens pegged to the U.S. Dollar. The founders of Steem wanted to pay content providers using a token that didn`t have wild value swings.
Holders of Steem Dollars receive an "interest rate" equivalent to 10%. That means 10% of all newly created Steem goes to the holders of Steem Dollars. So, for example, if you owned 100 Steem Dollars on January 1, 2008... one year later, on january 1, 2019, you would own 110 Steem Dollar.
Theoretically, Steem Dollars should always trade at or near $1. Right now, they trade at 95 cents. However, there are times when Steem Dollars trade below or above $1.
STEEM POWER
Steem Power gives you the equivalent of an ownership stake in the Steemit network. 90% of all new Steem created is given to holders of Steem Power. For instance, if you own 100 Steem Power by January 1, 2018, you will have 190 Steem Power by January 1, 2019.
Steem Power holders receive the biggest rewards and have the most Power on the Steemit network. The more Steem Power you have, the more weight your upvotes and downvotes carry.
(Steem Power is an illiquid investmemt. When you buy Steem Power, you cant sell it for 13 weeks. This is being done to incentivize decisions that are in the networks best long-term interest. When you do decide to sell Steem Power (even after two years), you cant sell it all at once. The cash-out cycle pays you in 13 equal weeky payments. For instance, say you have $100 in Steem Power, and in two years, its grown to $1,000 and you decide to cash out. Every week for 13 weeks, you will be able to cash in $76.92 of your Steem Power. ($76.92 times 13 = $1,000))
WHO IS BEHIND STEEMIT?
In 2009, Dan Larimer discovered bitcoin when it was just pennies on the Dollar. Seeing its potential, he instantly got involved.
Dan noticed that centralized exchanges were a weak point for bitcoin. So, he took his decade-plus experience as a software engineer and founded BitShares.
BitShares is a decentralized exchange built on the blockchain.
It runs on a technology called Graphene, also developed by Dan and his team. Graphene is designed to handle more transactions than Visa and Mastercard combined. And its the same technology behind the Steemit platform.
it was trough BitShares that Dan med Ned Scott. Ned, an early bitcoin adapter, started moonlighting for Dan in 2015, promoting the BitShares Technology to different firms.
Both Dan and Ned wanted to do simething bigger. They batted around ideas such as microinsurance and mutual aid. But the vision grew into something larger-Stemmit-a place where individuals get rewarded by a community for posting and voting on content.
Since then, the idea has snowballed. Dan and Ned founded Steemit in January 2016. It launched in early April 2016. And today, it has over 170,000 users.
But Steemit is more than a vibrant social media site. Dan and Ned se a future where entrepreneurs from different walks of life leverage and intergrate Steemit as an open-source publishing platform.
So Steemit could not only become the future of social media, but of publishing as well.