Understanding Steem : The cryptocurrency behind Steemit

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Understanding Steem: The Cryptocurrency Behind Steemit

Steem is a token of digital currency which functions in the Steemit – a social media network based on the principles of blockchain. Sneak peeked in 2016 is powered by Steem, Steemit has a well design interface for someone to earn rewards for posting and curating content. In this article, you will get to know about Steem and its place in the functionality of Steemit.

What is Steem?

Steem is a social blockchain created for the purpose of enabling decentralized applications, (Steem) with an in-built reward system that compensates users. In contrast with most social sites that make their profits from data and content of the users, Steemit uses the Steem blockchain to pay users. This motivates the generation of quality contents and proper interaction with the site.

How Does Steemit Work?

Steemit is based on Delegated Proof-of-Stake (DPoS) where all transactions are processed, fast and effectively. Users can earn three types of rewards on Steemit:Users can earn three types of rewards on Steemit:

1. Steem (STEEM): The first token utilized within the Digital Social Platform Steemit.
2. Steem Power (SP): A temperament of power in the apportionment. What it means is that the more SP you possess, then your votes will have a greater say on the general course of the democracy.
3. Steem Dollars (SBD): They include a stable coin that is backed up by the US dollar so as to afford stability in its value.

When a user makes a post on Steemit he or she has the opportunity to earn STEEM, SP and SBD depending on the number of upvotes a post attracts. This system makes users post qualities contents and also to interact with other users in different forums.

The Role of Steem in the Ecosystem

It’s worth mentioning that Steem has an unconventional incentive setup that helps it sustain a strong community. Here's how it works:

• Content Creation: Contribution of users includes posts and articles, which are voted by pointing up by other users. This means that the higher the number of upvotes the post gains the more benefits the person will be able to gain.
• Curation: Those who find once such content and upvote it are also benefited. This increases the audience engagement and gets the best contents in the surface.
• Voting Power: The more the SP a user holds, the higher the level of control she/he has in the platform. This makes sure that the top providing contributors should be in a position to have a greater say on which content has to be provided or deleted.

Advantages of Steem

Steem offers several advantages over traditional social media platforms:Steem offers several advantages over traditional social media platforms:

• Decentralization: Steemit is decentralized which eliminates a possibility of censorship and user’s data belongs to them.
• Monetization: Every contribution that users make shall gain real value while in other similar social media platforms only the owners of such a platform benefit.

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Challenges and Future Prospects

While Steem and Steemit have shown promise, they face several challenges:While Steem and Steemit have shown promise, they face several challenges:

• Scalability: As the subscribers’ council increases, managing and carrying out fast transactions on the platform becomes a problem.
• User Adoption: The major challenge when it comes to social media is the functionality of maintaining the users over a long period of time when there are many other similar platforms available.
• Regulatory Environment: Successfully operating in the cryptocurrency sphere that is specifically changing with the various adaptations of various standards is vital for Steem.

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Nevertheless Steem, as well as other social media platforms employing the blockchain technology and a unique approach to the monetization of content, remains a serious contender in the blockchain market. With more users and developers starting to appreciate the possibility of the decentralised platforms, Steem and Steemit stand to benefit from the growth.

To sum up, it is possible to see that Steem is a revolution in the perspective of social media and sharing content. Being built on the blockchain technology, Steemit provides its users with the opportunity to own their content and be ‘paid’ once using Steem cryptocurrency for it.

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