Summary of Steem platform:-
Steem is a blockchain-based social media platform that incentivizes and rewards users for participating in the network and community. Their platform enables content creators, curators, readers, entrepreneurs, and so many more to take power back from today’s social media networks, and gain control back over their content and activities on a public network.
Steem’s Whitepaper explains their platform as a “blockchain database that supports community building and social interaction with cryptocurrency rewards.” The Whitepaper abstract goes on to state,
“An important key to inspiring participation in any community, currency or free market economy is a fair accounting system that consistently reflects each person’s contribution. Steem is the first cryptocurrency that attempts to accurately and transparently reward an unbounded number of individuals who make subjective contributions to its community.”
This seems to be the greatest explanation of the platform’s concept and the intentions of the creators of Steem. Current social media platforms do not allow for their capabilities and functionalities as users, and contributions to the network are not rewarded at all, but rather taken advantage of through data collection and advertising schemes that buy that data.
Below in the token section, we will discuss the rewards and incentives of the platform, as it goes hand-in-hand with the function of the STEEM token.
STEEM token purpose
The Steem token is referred to as STEEM (the same name, but captialized letters). STEEM functions as a rewards tool in the Steem network, so when you post valuable or well-liked content or if you up-vote content before anyone else, you can earn STEEM. An interesting and somewhat abstract aspect of Steem’s platform tokens is that they have three different types of “asset classes:” Steem (STEEM), Steem Power (SP), and Steem Dollars (SMD). Their White Paper explains these concepts more in depth on pages 8-11. We will briefly explain them here.
STEEM is the “fundamental unit of account” in the Steem blockchain network and is purposeful when you need to increase liquidity. Other tokens derive their value from the STEEM token, and STEEM serves as the means to enter or exit the network, but you would typically convert STEEM into Steem Power or Steem Dollars after you get it.
That being said, Steem Power (SP) is a tool in the network which functions better for long-term commitments that need to retain or grow long-term plans, rather than cash out or exit with their “shares.” This is intended to grow a community for long-term growth and goals, and their White Paper also relates it to “fund growth through contribution incentives” Steem Power is not as easily traded on exchanges, but it is essential for being able to vote on content and participate in certain actions on the network. Steem Dollars was included in the ecosystem as a measure to retain stability on the network. The White Paper relates Steem Dollars to “convertible notes,” which are equivalent to a form of “short-term debt instruments.”
This information can get very muddled, and because each type of token in the Steem network has specific activity purposes, as well as being used as tools to ensure economic principles within the network, we highly suggest reading their White Paper, which has the clearest information about the various features of each form of Steem.