Crypto Academy Week 7 - Homework Post for Professor @sapwood on Steem Blockchain (Inflation, Recovery Account, Encrypted Message) Homework by @hadassah26
Good day beautiful steemians, this is my week 7 homework for professor @sapwood on Steem Blockchain (Inflation, Recovery Account, Encrypted Message).
Blockchain has brought a new type of work, with Bitcoin involving the Proof of Work concept, where miners are rewarded for every new block, and Ethereum having the Proof of Stake where token holders are rewarded for money staked in the system.
Steemit works with a combination of the Delegated Proof of Stake (DPOS) and Proof of Brain (PoB) concepts.
DPOS:
Designed by Daniel Larimer, the Delegated Proof of Stake is a derivative of the Proof of Work and Proof of Stake protocol.
The Delegated Proof of Stake protocol uses an energy efficient algorithm where each block is created with a much lower computing power. link
The Steem DPoS reward protocol involves 35% of the reward on every block is shared at a ratio :
- 10 % to Steem
- 15% to Steem power holders
- 10% to Steem block creation (20 +1) witnesses
This shows that 15% of every block is given back to Steem Power Holders without having to do any thing, while the remaining 20% is shared between Steem and block witnesses.
Steem Inflation
Steem uses a deflationary inflation model where its inflation reduces by 0.01% after every 250,000 blocks, therefore an inflation annually calculated to the addition to the total Steem per block on creation. This creates a deflationary pressure on the Steem coin and reduces excess Steem circulation. link
With every new Steem block created in 3 seconds and 250,000 blocks every 750000 seconds (8.68 days) meaning the steem inflation reduces by 0.01% 42 times a year.
Thats about 0.42% inflation reduction annually.
What does this deflationary inflation mean:
This tells us that the production of steem on every 250,000 amounts of blocks is reduced by 0.01%.
Currently the total amount of steem blocks produced from Steemworld.org is 52,347,390 this is the Head Block under Market info on the Steemworld.org site picture below:
This shows that the current inflation can be calculated as:
( 978 - (Head block / 250,000) ) /100
Head block = 52,347,390
Current inflation = (978 - (52,347,390/250,000) )/100
Current inflation = 7.6861%
Current total amount of steem produced = 389,560,186.431 ( this can be gotten from steemworld website as the Virtual supply under Market info)
The time to create a block is 3 seconds. So in a year total blocks created is equal to (365 * 24 * 60 *20)
= 10,512,000 blocks.
This show that assuming today was year end 2021, the total amount of steem added to per block will be:
=( current virtual supply * current inflation ) / number of blocks per year.
Current virtual supply = 389,560,186.431
Current inflation = 7.6861%
Number of blocks per year = 10,512,000 blocks.
= (389,560,186.431*.076861)/10,512,000
= 2.8483 Steem per block.
Now let us try simulate the amount of steem to be produced yearly till it gets to a 0.95% inflation.
Below is my excel simulation:
NB. We take current factors determining current virtual supply to be constant.
From the above chart we can see that the amount of steem per block increases gradually till 2027, where it soon starts reducing till a steep reduction from 2030.
Questions:
1a. As most of the STEEM tokens will be minted in the next 10 years or so(on account of inflation), how important it is for you to build your SP in the next 10 years and build significant influence power in the form of SP?
With the projected increase in steem reward per block from now till 2027 and still a marginal reduction before 2031, and a 15% reward per steem power held by an individual, it shows that the reward per steem power held increases for the next few years before a minimal average marginal reduction.
This shows that holding steem power will be of much value as it generates much more reward for its holders for the next six to ten years.
1b. How difficult will it be to earn STEEM rewards after 2031?
With the current reward rate at 2.8483 Steem per block, and the reward rate at 2.2644 and lower from 2031, it will be ( 2.2644 - 2.8483)/ 2.2644 = about 25% harder to earn Steem after 2031.
1c. From 2021 to 2031 how many STEEM tokens are going to be minted(approximately)?
This is a total of the virtual supply of 2031 minus the virtual supply of 2021 from my excel document this is equal to:
=683,753,584.7-389,560,186.43
= 294,193,398.27 Steems total.
1d. In: which year is the inflation and Block reward is likely to saturate(tentatively)?
By 2024, the Steem reward per block will be at its highest at 2.9384 Steem per block when the inflation is at 6.4247%.
2a. Who is your recovery account in Steem, how do you check it(Hint- Steemscan), include screenshot(s)?
My recovery account is Steem.inc as can be seen on www.Steemscan.com/account/hadassah26
This is because I created my account directly from the Steem website.
2b. In the case of any unforeseen event like hacking what information do you provide to the recovery account(or the trusted account) to initiate the recovery process?
In case of unforeseen events, I must provide my keys and password. This I must do within 30 days of the account theft occurrence.
3a. How do you send an encrypted message(private message) to another peer in Steem Blockchain(include screenshot/process)?
Encrypted messages are sent via the Memo text box provided when transferring Steem to the receiver.
To make the message encrypted, I have to add the “#” symbol without space to the text.
Procedures below:
Open steem wallet and click on the small black triangle beside Ur steem balance.
Click on the triangle and select transfer:
Add text plus “#”symbol before text and transfer to designated receiver.
Others can then receive this steem without seeing the encrypted message.
3b. Which key is required to send a private message and which key is required to decrypt it? (Example/Screenshot)?
The Master key is used to send encrypted messages to one another through the memo text box provided in the transfer window.
The Memo key used to log in to the Steem wallet where you see the decrypted message as shown in the picture below.
3c Either send an encrypted memo-tag to exchange and send a private message to another user?
I have sent a sent a private message to another user and it went correctly.
I am hadassah26 and this is my Week 7 homework for professor @sapwood.
Thanks.
This homework is an inspiration for me to do more. I appreciate and thank everyone who have encouraged me in the steemcrypto community.
I also hope this is a relevant post to @nutbox.mine in the NutBox community.
Thanks again.