Learning the fundamentals of Steem
Steemit is not as straightforward as facebook or reddit. There are so much to learn and some concepts are really hard to grasp. We spent a long time figuring what each of the terminology means.
Here, I will try to explain some of the below to help you understand.
STEEM
Steem is the cryptocurrency used in the Steem blockchain. It can be
- Earn - by creating contents on the steemit.com
- Bought - from crypto exchanges like binance.com
- Converted - from Steem Backed Dollars or Steem power
STEEM Backed Dollar
The purpose of STEEM Backed Dollar (or SBD) is meant to provide a stable currency so that it is suitable to be used for everyday transactions, like buying things on the internet. According to the Steem whitepaper, the SBD is supposed to be pegged to USD$1 for stableness. However, this was not the case recently, as market dictation moved the SBD to as high as USD$3.The SBD can be
- Earn - by creating contents on the steemit.com
- Bought - from crypto exchanges like binace.com
- Converted - from Steem
STEEM Power
Steem Power (SP) is probably the most important attribute of your steemit account. First, let's see how to acquire Steem Power.SP can be
- Earn - by creating contents on the steemit.com
- Converted - from Steem
The amount of SP you have determines how much your upvote is worth. An upvote is similar to a 'Like' in Facebook. When you come across a steemit post that you like, you can Upvote the post and the author will be rewarded. The amount of reward depends on how much SP you have. Example, 1000sp will have a vote value of around $0.30. This amount awarded to the author does not come from your own pocket. Instead, it is from the Daily Reward Pool that the steem blockchain is creating everyday.
Similarly, the post that you create on steemit will get Upvotes from other users. And the more SP your supporters have, the more you will earn.
Voting Power
Then can I go around and Upvote as many posts as I like and reward all other authors? Yes and No. There is a built-in mechanism in the steem blockchain using Voting Power (VP) to prevent abuse of Upvotes. Here is an example of how it works, again, let's use the example of 1000sp.
- Upvote at VP of 100% = $0.30
- Upvote at VP of 98% = $0.29
- Upvote at VP of 90% = $0.25
- Upvote at VP of 50% = $0.15
- Upvote at VP of 10% = $0.01
For now, don't be too concerned with VP. As a newbie, we can just upvote as much as we like.
That's all for now! Let us explore other steemit features in future posts! Stay tuned!
Posted from my blog with SteemPress : http://steem.jrvacation.com/learning-the-fundamentals-of-steem/
Thank you for your post. I am still blur blur about how Steem works. Now I can re-learn all about Steemit.com again. Wonderful!