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RE: VEDA Day 6 - Promoting Steem To Social Media Guru Friend
"This only has value if people believe it has value." This was the turning point for my comprehension. I asked the same question when I started, then my wife asked me when I tried to tell her about it and I couldn't answer. I read a couple of books, did some Internet research, and the penny dropped for me when I realised that I didn't know how money works either. THEN I realised that a tenner only has value because we believe it has. Then the old pound coins went out of circulation and, on that day, I came to understand the belief system. Yesterday it was worth £1 and today it became worthless.
That said, I still don't really understand where the rewards pool comes from.
Most people have no idea what money really is. I'm still not 100% there either but I've learnt a lot recently.
The way I see it, every crypto blockchain is like it's own planet. The crypto tokens are like a precious metal - like gold. Each day, a given amount of gold is mined. In the real world, the miners/companies/land owners get the gold. The blockchain simulates who gets the gold by a bunch of algorithms. On our Steem planet, it's to do with how much SP you already have, how much content you create, how much you curate, who curates you, e.t.c. Of course you could also just buy gold from other people. It's very complicated maths I think, but the basics is, there's an agreed amount of Steem printed everyday and distributed according to the agreed rules.