- Steem Cryptocurrency is a subclass of digital currency – appcoins. The value of these tokens depends on the platform’s value.
- Steemit is the brainchild of Dan Larimer – CEO of BitShares, and Ned Scott – BitShares and EOS creator.
- Steem currency only has value on the Steemit site, although you can convert it to other digital currencies like bitcoin. You will need Steem coins to pay for Steem Power (stock) or Steem Dollars (1 Steem Dollar = $0.97-$0.99) and vote on content.
- Steem currency is associated with Steemit, a new type of blockchain social media.
- Steem cryptocurrency has a current market capitalization of $18 plus billion with current Steem Dollar values at $3.11. The market is stable, and forecasts predict it to remain that way.
Three-Pronged Currency – Influence of Steem Power
At its core, Steemit is a blockchain social media site that lets posters get paid for their work, rather than getting hundreds of shares and likes but no income.
Millions of users participate in voting posts up and down, which increases or decreases the value and share content, helping artists get more recognition and profit.
The more power a voter has, the more your content is worth. If you don’t have any Steem power, you can’t cast votes. You earn SP as payment for your content or by trading your Steem dollars or coins.
Steemit has a three-pronged currency setup that allows curators and users to make money for interacting with the social media platform. There are three types of tokens – Dollars, Power, and Steem.
Steem coins are the primary source of cryptocurrency for Steemit. You need coins to manage your Dollars and Power, the other two currencies used.
Unlike other digital currencies, you don’t have to mine to get Steem coins. Instead, Steem forms new coins each day. These coins are then split up like this:
- 75% divided among curators and authors
- 15% split between users who own SP
- 10% goes to miners
Due to the continued production of coins, you should convert your tokens to Dollars, Power, or another cryptocurrency rather than trying to let them accumulate.
Steem dollars are a more stable form of currency than coins, which can fluctuate in value depending on the market.
SBD, or Steem dollars, attempt to have an equal value to a USD with a 1 to 1 ratio. Meaning, one Steem dollar is the same as a $1.
However, as 2017 proved, when the value became 1SBD- $13, this value can increase or decrease at any time.
When you create content on Steemit, 50% of your payment will be in Steem coins, and the other 50% will be dollars, which helps protect you from fluctuations. You can also trade SBD on multiple currency exchanges.
Steem Power (SP) is a way for users to invest in Steem stocks, which allows you to earn an income from Steemit’s earnings, in addition to the money you make as a content creator.
As a stockholder, you can have a say-so in site decisions, although you’ll need to hold a substantial portion. You also get more voting power. Raising your Steem Power increases your compensation. This process is powering up.
If you want to convert your Steem Power into Steem so you can convert to money, you’ll do a process called Powering Down.
This process does take 104 weeks, so it’s not instantaneous. And you have to hold your stocks for at least 13 weeks before you can convert them.
How & Where to Buy Steem Power?
Steem uses Steemit Wallet to automatically store your Steem cryptocurrency, including their tokens, Dollars, and Power. You can access this wallet on the Steemit site or utilizing the eSteem mobile version.
When you use the Steemit wallet, you can buy Steem power and handle all of your financials.
There’s also the option to save your currencies in a Hardware wallet, which keeps your digital crypto off the network and safe.
You can also use other electronic wallets if you don’t want to use Steemit. Vessel is a desktop wallet that can help you through the whole process of storing your Stem currencies.
If you want to own Stem without producing content, you can purchase stocks through a Steem exchange such as Binance, which deals in over 100 cryptocurrencies, including Steem.
For trading Steem, you’ll need a broker that handles cryptocurrency. Plus500 and eToro are two of the best brokerage companies that manage Steem trades. Plus500 requires a minimum of $100 deposit to start an account. eToro only requires a $50 minimum deposit.
How to Make Money Off It?
The easiest way to make money is to publish quality content that users enjoy reading enough to upvote. The more your work gets upvoted, the more money you earn.
But if you hate to be creative but love to show your support, Steemit pays you for that too. When you post comments on users’ posts, your comments get votes. The best comments get maximum upvotes, increasing your steem dollars.
To cast votes, you need Steem Power and Steem coins. You can buy these in your SteemWallet or any other digital wallet you may use. Binance is one of the largest and top exchanges to buy Steem Coins, but you will need to pay with cryptocurrencies like Ethereum or BitCoin.
New coins are created each day, but there is the option to mine for Steem tokens. You have to show Proof-of-Work, and 90% of your profits go into your investment fund. Each Steem block mined results in 1 Steem. The other 10% is split between content creators.
You can use Steem to earn spendable cash by converting your Steem coins into another form of cryptocurrency and then converting that into USD. You can also convert your Steem Power into spendable currency, but it takes a few months. However, you cannot trade your Steem Power.
Bottom Line – Investment Summary
Given the steady growth of Steem, the number of active users, the decentralized system, and the recent unrest of many users with other popular social media sites like Facebook and Twitter, Steem is likely to continue growing in popularity and value. From an investment standpoint, this would be a successful site to invest in for artists, freelance writers, and users who spend a lot of time on social media.