Aug 09 2016

Steemit: Get on the blockchain social media juggernaut and earn cryptocurrency for posting content

“Welcome to the Blockchain! Your voice is worth something,”  states a webpage of Steemit, the social network built on a blockchain  that’s now exploding with popularity. For a while now, experts in the crypto space have talked about leveraging social media. Back  in 2014 there was news circulating that Reddit was considering creating  a cryptocurrency backed by shares of the company, to be redistributed  back to the community in recognition of the role it has played in the  site’s success.

Enter Steemit, a blockchain database that supports community building  and social interaction through cryptocurrency rewards and a reputation  or influence-based system, known as Steem Dollars and Steem Power.Ned  Scott, CEO and co-founder of Steemit, told IBTimes: “If you think about  the existing models – Facebook, Twitter, Instagram – these are  platforms that invite people to come and do all this work so that their  shareholders, who are not necessarily contributors make all this money.”Our  platform is a cooperative version of a social network which is more  intuitive, and a more shared, community-driven approach, and that’s why  our early user base is growing.”We are completely open source;  the blockchain and even the website, and we are seeing entrepreneur  after entrepreneur show up to build their own tools. Literally more than  15 entrepreneur-built, third party-built tools have popped up in the  last few weeks.”Steemit grew out of a long process set in motion  by gifted developer and co-founder, Daniel Larimer. It evolved from the  idea of a decentralised exchange, in the form of the iconic Bitshares  platform, to a later exploration of blockchain-based mutual aid and  micro-insurance, with a forum added for users to interact and compare  notes.

 

Scott said: “We realised that the forum has got to be on the  blockchain so that it’s really tied to people’s accounts and it’s  totally verified. Then we had this idea that the blockchain could pay  them to post, kind of like the way mining works for Bitcoin, and pay  them to vote so that there’s this wisdom of the crowd element. Before  long we were saying, this is going to look a lot like Reddit, except  people are going to get paid to post and vote.””So it combines a  lot of the technology that has appeared along the way. Underneath the  hood, there is a piece of the decentralised exchange in there; there are  ways for people to do mutual aid across this blockchain and tell their  stories. All these concepts that we care deeply about are caked into  this.”But at the same time there is this great element of fun and  networking that kind of makes the platform much more friendly and  viral.”Scott said the team are currently looking at social  media-type features that need to be built into the platform. “We’re  looking at successful things we have seen on social media sites like  Twitter, including follows and perhaps categories; we will also add  private messaging and open up real time communication for people in a  peer to peer, totally encrypted manner.”From a blockchain  perspective, one cool thing about Steemit is how it does away with  traditional cryptocurrency barriers to entry, like having to go and buy  coins at an exchange. “We have come up with some innovative solutions  that make cryptocurrency much more user friendly, to the point where it  kind of moves to the background.”With Steemit you just show up  and do things you are already doing; you are posting and voting and by  participating you earn cryptocurrency.”Scott said users don’t  have to worry about managing their accounts, or understanding how  private keys interoperate with the public keys and addresses; long  strands of private numbers have been substituted with simple account  names for a more intuitive UI.In addition, a layered key security  system hides in the background. “We have built certain measures into  the protocol level itself to make sure that when disaster strikes it  isn’t actually disaster. For instance, we have come up with  trustee-based account recovery and now people link their account to  another account – essentially another person – who can then vouch for  their rightful ownership or identity.”Scott said that basically  the blockchain is able to return an account to a user if they have their  former password. “So it negates a hacker’s ability to make off with  people’s accounts. That’s crucial. Before in crypto, you lose your  private key, or your private key gets stolen, that’s it, you’ll never  get it back.”He also said Steem Power is constituted with a time  delay in respect to how it can be removed from accounts. This means that  should accounts be compromised, they cannot be instantly drained.In  terms of genealogy, predecessor Bitshares employed the concept of  delegated proof of stake, which is the idea that witnesses are voted  into a queue to produce blocks and are voted in by their shareholders to  have this job of producing blocks. They are accountable for being block  producers and they can be quickly eliminated for bad actions, thus  ensuring a pool of good actors.

Scott  said: “We took that concept and said it’s missing something; it’s  missing the element of proof of work. So for Steem we created a hybrid  model that is both proof of work and delegated proof of stake.”Because  of that, the block production is completely decentralised across nodes  around the world and it’s also much easier to communicate between nodes.”There  are actually two types of proof of work here. There’s the one that we  have been talking about that we call subjective proof of work, which is  when people are posting and voting. That’s the work they are bringing to  the network, and they get paid for it.”There’s also the  traditional proof of work, where people are showing up with their  computers to send hashes to the network. The way it works here is they  get a place in the queue, they go through the queue and then they get to  produce their proof of work.”Scott said everyone is rewarded one  way or another. People who post content actually get rewarded 50% in  Steem Power and 50% in Steem Dollars. He explained that at its root,  it’s all Steem: the token is split between tradability and reputation.”You  get maximum stability with Steem Dollars, which are pegged to the US  dollar. Or you have maximum influence, which is Steem Power, that allows  you to participate and earn more by voting, promoting your own content  and promoting other people’s content.”Steem launched on exchanges  in mid-April and has risen from a market cap of $3m to $10m, then  around $20m. Scott said: “Just in the last four weeks, it’s just kind of  taken off – it’s had a ride into the hundreds of millions. It’s  incredible, but Steem is currently the third most valuable  cryptocurrency in the world.”

Read on Steemit!

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