What is STEEM and how does it work? A basic guide | finder.com

What is Steem (STEEM)?

What is Steem?

Steemit, STEEM and social crypto explained

What you need to know about Steem (STEEM), a social-media network powered by the blockchain.

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Learn more Buy Steem

Steem represents a fusion of ideas, drawing from both social media and cryptocurrencies to create a new kind of platform. Anybody can create, share or upvote content on the Steem network, earning cryptocurrency tokens based on performance within the community.

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What is Steem?

IconSymbolLaunchedAlgorithm typeMax. supply
STEEMMarch 2016SHA-256No max

Steem’s main platform, called Steemit, is a social media network built on top of the Steem blockchain. Steemit is similar to popular content-driven social networks like Reddit and Medium, but it rewards users with cryptocurrency for their participation. Here’s how it works:

  • Fundamentally, the more value a particular piece of content provides to a greater number of people, the more the individuals responsible for creating and curating that content can earn.
  • Users cast votes, creating a hierarchy of content. The more upvotes a post gets, the more it will earn. The platform also allows for downvotes, giving participants more flexibility when it comes to rating content.
  • Steemit is meritocratic, meaning users that hold more currency can cast votes with greater influence.

How is Steem different from bitcoin?

Both Steem and bitcoin were designed with a particular function in mind. Bitcoin was created to serve as a digital, peer-to-peer currency. Steem is, at its core, a social media platform. Many social media platforms use voting systems, such as upvotes, shares or “likes” to prioritize content. Steem incorporates these concepts into a unique, blockchain-based platform that pays users in STEEM for their contributions to the network. While STEEM and bitcoin are both cryptocurrencies, STEEM’s usage is specific to social networks.

Steem has three cryptocurrencies

There are three digital tokens that make up the Steemit ecosystem: STEEM, Steem Power (SP) and Steem Dollars.

  • STEEM. STEEM is the foundational cryptocurrency of the Steemit network. STEEM can be exchanged for bitcoin or other cryptocurrencies via several prominent exchanges. In order to cast votes, however, you need to turn your STEEM into Steem Power (SP). This process is known as “powering up”. You can also convert STEEM into Steem Dollars.
  • Steem Power (SP). When you turn STEEM into SP, you are investing it in the network as equity. One unit of STEEM, vested as SP, equates to one vote. Those with the most SP to contribute have the greatest influence over which content is elevated to the top. Upvotes and downvotes, or “flags”, from users holding large amounts of SP are worth more than users with less SP. Additionally, around 90% of new STEEM that is created goes to users who hold a lot of SP, which creates an incentive for participants to invest their earnings back into the network. Rate limits are in place on converting SP back into STEEM, known as “powering down”.
  • Steem Dollars. Steem Dollars, valued at 1:1 with the US dollar, are a unit used to represent a short-term debt. Holding Steem Dollars is described in Steem’s white paper as a way of lending the community the value of one US dollar, which is designed to foster growth.

How to get STEEM

There are two ways to get STEEM: buy it or earn it. You can buy STEEM on several popular cryptocurrency exchanges, including Poloniex, Bittrex and ShapeShift. Buying STEEM is probably the fastest way to acquire this currency. Earning STEEM is done by engaging with the Steemit community, posting content, commenting, sharing and networking. The more valuable contributions you make, the more STEEM you should earn.

Exchanges that sell STEEM

Name Product Payment Methods Available Fiat Currencies Available Cryptocurrencies
Cash, BPAY, POLi, Cryptocurrency
AUD
BTC, BCH, ETH, XRP, ADA, XEM, LTC, XLM, MIOTA, TRX, DASH, NEO, XMR, EOS, QTUM, BTG, LSK, ETC, XVG & over 60+ more
CoinSpot is an Australian-based marketplace that allows you to easily buy, sell or trade more than 100 cryptocurrencies.
Credit card, Debit card
USD, EUR
BTC, BCH, ETH, XMR, ZEC, DASH, XRP, ETC, LTC, DOGE, XLM,1ST, ADX, AMP, ANT, BAT, BCN, BNT, BTG, CFI, CVC & 70+ more
Access competitive crypto-to-crypto exchange rates for more than 35 cryptocurrencies on this global exchange.
Cryptocurrency
-
BTC, ETH, XRP, DOGE, XLM, ETC, STRAT, LTC, SC, DGB, BCH, LSK, XMR & 50 more
Trade various coins through a global crypto to crypto exchange based in the US.
Cryptocurrency
-
BTC, ETH, XVG, SC, XRP, DOGE, STRAT, XMR, ADA, OMG, ETC, BCC, XLM, DGB, UKG, QTUM, ZCL, RDD, LTC, NEO & 120+ more
Buy from one of the largest crypto to crypto exchanges with a selection of over 190+ cryptocurrencies.

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Can Steem be profitable?

There are many opportunities to earn rewards by participating in the Steem network. Rewarding individuals for creating and curating content that provides value to the community is at the core of Steem. That being said, new users should have realistic expectations: it’s rare for an individual to have a first post go viral and earn a huge reward.

Because Steemit uses a voting system to prioritize quality content, there is a strong incentive for participants to deliver. Accumulating Steem Power (SP) is another way to grow your influence and earnings on the Steem network. The more you invest in the platform, the more influence your upvotes have, which in turn gives you further opportunity to earn rewards.

What to keep an eye out for

  • Currently, Steemit is the primary application for Steem, although other social networks may integrate the Steem blockchain into new or existing platforms.
  • Because users with lots of SP cast votes with more weight, getting flagged by one of these users can have a severe impact.
  • The supply of STEEM increases by 100% every year, making it a highly inflationary currency.

What’s next for Steem?

  • The developers behind the Steem blockchain recognize that Steemit is one of many potential applications that could benefit from the underlying software. The 2017 roadmap for Steem emphasizes extending this technology to third-party developers. Adding microservices and public service endpoints will make the Steem blockchain easier for developers to work with.
  • Steem is working on mobile apps for iOS and Android.
  • Free drag-and-drop image hosting is being integrated into the Steemit platform.
  • Several steps are being taken to improve user experience, including an updated user interface (UI), rebranding of Steemit and simplification of the signup process.

Frequently asked questions

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4 Responses

  1. Default Gravatar
    dsofranko75@gmailFebruary 12, 2018

    how do i earn coins

    • Staff
      kathyclairFebruary 16, 2018Staff

      Hi there,

      Thanks for getting in touch with finder, a leading comparison website and general information service.

      Earning STEEM is done by engaging with the Steemit community, posting content, commenting, sharing, and networking. The more valuable contributions you make, the more STEEM you should earn.

      The first thing you’ll need is a Steemit account, please go to Steemit.com and sign up. When you Signup a new Steemit account you’ll receive $10 worth of Steem Power, so in order to prevent fake accounts from being created, you’ll need to prove your identity by signing up to your facebook or Reddit account.

      Hope this helps!

    • Default Gravatar
      RyffMarch 25, 2018

      What if we absolutely hate Facebook and haven’t had the desire to login in over 3 years? Also, I have no reddit account either. I signed up for one a few years ago, didn’t really know how to use it so I never did. What other forms of identity will steemit accept? I’ve had my gmail since it was still in beta stages, back when you had to be invited by a friend or relative to gain access. Love gmail and have been using it ever since.

    • Staff
      JoanneMarch 26, 2018Staff

      Hi Ryff,

      Thanks for reaching out.

      To create an account with Steemit, you will be asked to enter your email address and verify your phone number. After your information has been verified, you will be added to the waiting list to receive an account. You will be notified via email once your account is approved.

      Basically, the information you will need to create an account is your email address and phone number. You mentioned that you had a gmail since it was still in beta stages. As long as it is a valid email address that you can access, you can use it to register. The email address need to be active since the provider will be sending some of the details in that email.

      Cheers,
      Joanne

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