What Is Steem (STEEM)?
STEEM is the native coin of the Steem network, which is a blockchain that puts focus on incentivizing the community. Steem blockchain allows developers to build various decentralized applications (dApp) and for content creators to monetize their content and grow their communities.
For more detailed information about the STEEM price, check out the graph above.
The consensus mechanism employed by Steem is Delegated Proof-of-Stake. In essence, users have to pick validator nodes, which are referred to as Witnesses. They have to secure the network and create new blocks. On Steem, Witnesses generate blocks every 3 minutes.
Immediately after the genesis block of Steem was released in 2016, the first application of the Steem network was developed and named Steemit. It essentially is a social media network that is based on a blockchain. Thus, it allows users to create and curate content online but they get rewarded in crypto for doing that. The amount of rewards they receive depends on the number of votes their content receives. Besides, users can also downvote content if they don’t like it.
Steemit was developed by Ned Scott and Dan Larimer. Prior to developing Steemit, Scott worked at an American Food importing company as a business operation and financial analyst. Larimer, on the other, is a software engineer and entrepreneur who has been involved in the crypto world for a quite long time.
Later, other dApps were developed on Steem, including DTube (decentralized video platform), Utopian (open-source project funding app), and many more.
The Purpose of STEEM Coins
STEEM is the base token of the Steem network. It can be exchanged for Steem Dollars or converted into STEEM Power. Steem Dollars are stablecoins that are pegged to USD at a 1:1 rate. STEEM Power, on the other hand, acts as a measure of the user’s level of influence inside the Steem network. The amount of STEEM Power tokens influences the number of rewards a content creator receives.
Talking about use cases of STEEM, it’s mainly used to reward content creators and curators on the Steem network. However, it can then be traded on various markets for other tokens. Just like Steem Dollars, which can also be traded in exchanges. STEEM Power tokens, though, cannot be traded directly, they can only be converted (powered down) back to STEEM tokens.
Tokenomics of STEEM
STEEM coins are inflationary, which means there is no max supply set. The tokens are issued as block rewards for Witnesses. Since Witnesses create new blocks every 3 minutes, STEEM tokens are issued daily. However, only 10% of the block rewards go to Witnesses. 75% are used to reward content creators and the remaining 15% go to STEEM Power holders.
The rate of inflation for STEEM tokens was fixed at 9.5% annually (starting in December 2016). However, every 250,000 blocks, the rate is supposed to fall by 0.01%. At this rate, inflation will continue to fall until it reaches 0.95%, which is estimated to take around 20 and a half years.
The STEEM price is subject to change, so keep that in mind if you're thinking about purchasing STEEM tokens.
The main reason for this is the volatility of the entire crypto market. It has an impact on most cryptocurrencies including the STEEM price. Thus, if you're interested in purchasing the token, make sure to monitor it first.
There is a variety of tools to help you with this. For instance, our price graph (which you can find above) will allow you to have a deeper look into the STEEM price history and other important details of the project.