STEEM tokens are produced by the Steem blockchain 24 hours a day, 7 days a week. What happens to them next? I will explain it to you in a simple example.
Source: Pixabay link [CC0 License]
About 60,000 STEEM tokens are created daily and this number will expected to drop over the next 17 years. The new tokens that are created are divided into three groups:
✅ 10% of STEEM tokens goes to witnesses for powering the blockchain network. This is their automatic payment for maintaining servers.
✅ 15% of new tokens are awarded to STEEM POWER owners at all times. So here is the first plus freezing of your STEEM tokens on the platform shares. Therefore, the balance of our SP units grows automatically all the time by a small percentage.
✅ 75% of the whole majority of newly created STEEM tokens goes to finance the reward pool, divided between authors and curators. Who decides to give them each day? Just STEEM POWER owners.
The Steem blockchain network is like a token factory. The owners of STEEM POWER decide about their distribution. The amount of SP owned determines the number of new tokens that someone can give away in the form of votes each day.
Imagine a factory that gives away something for free. The bigger the car you have, the more goods you can take out each day. STEEM POWER is the size of your car. So if you have little STEEM POWER, it's as if you were coming to the free goods on foot, while others would be loaded with full trucks. Of course, you can only take the goods for yourself, by voting only for your own posts, but then you lose the opportunity to earn a living as a curator (seeker of high quality content) and the community may not like that you can take a lot and you only think about yourself.
Source: Pixabay link [CC0 License]
STEEM tokens are created from nowhere. Their value is determined on the global market. The factory will gradually reduce the number of tokens created for the next 17 years. Their possession in the form of STEEM POWER gives you the power to decide who get new created STEEM tokens. Although many still sell tokens received, the STEEM price should increase at the current stage of the platform. The number of active users on Steem is still nothing compared to the global market, where millions of people can trade in tokens from around the world. Let's collect STEEM POWER so that our power in the Steem blockchain will grow.
Thank you for reading!
Tremendously amazing, thanks a lot for your info very clear ..!!
Posted using Partiko iOS
That was seriously the simplest most effective way to explain the process and I now have a clearer picture because of it. I have also just recently decided to stop delegating my steem power and return it so I can get more involved and add to the community by genuine interaction.
Thank you for that input. Greatly appreciate it.
Thank you for your comment. I'm happy to help someone better understand Steem.
So if I delegate my SP does this mean the newly generated tokens go to the one who I delegate my SP to?
Posted using Partiko iOS
No. The delegation allows others to vote with your power. They receive curatorial rewards from this power. However, new tokens for having SP all the time go to you.
Thanks for explaining. I’m learning something new everyday 😊🙏
Posted using Partiko iOS
The SP, allows you to grow and make others grow, particularly I often think about delegating my SP. However, when understanding how this ecosystem works, without a doubt it is better to keep it own and work it.
I am collecting all the steem power and convert steem and sbd into steem power too.
Steem from the community perspective is the best dPoS blockchain!💪
Posted using Partiko iOS
@astromaniak this is a very clear post and hasd helped me understand the inner workings of the blockchain. the only thing i would say is that tokens are n ot generated from nowwhere. witnesses produce the price and are rewarded in SP as far as i understand. but great post, followed!
Good explanation of SP, @astromaniak. Very succinct.
that's exactly what i was looking for :) thanks
Great simple explanation but "The factory will gradually reduce the number of tokens created" is wrong. The INFLATION RATE is the one being reduced over time. The absolute amount of STEEM being created keeps increasing because total supply keeps increasing.
#sbi-skip
I do not say that tokens on the market will be less and less, only that the production of new ones will be smaller and smaller.
In Malta, one of the most delicious fruits in Bangladesh, some of the young people in the country are benefiting very much as a business.
If this is the case, Bangladesh will be the only country in the field of production.
Posted using Partiko Android
I LIKE STEEM
I like steem token! Soon I'll get a lot of people, and to raise them to the sharks. My target 1 000 000 SP.
My Discord: https://discord.gg/7gbREDZ
My Telegram: https://t.me/orangesharks
@astromaniak , you say that the number of steem tokens generated will gradually slow down over the next 17 years or so. The question is what will be the worth/use of steem tokens when they have slowed down to almost a halt. What will then attract new users to steem.... Can we assume that then the steem tokens will be worthless ?
If there is demand a reduced supply, the price should go up, like any collectible.
Posted using Partiko iOS
@shainemata , that is exactly my question that once the steem tokens being generated have slowed down considerably, then new users will not be attracted to upvote or post content (in short won't be attracted to steemit as it won't be worth the effort and time). So obviously there will be no/less demand for steem tokens and I am wondering why the steem tokens at that time will hold any value when the main steem engine (on which the whole game of rewards is based upon) will have slowed down considerably. I personally think at that time the steem tokens will be worthless.
I think that if the newly created STEEM pool decreases, the value would increase for each one. So, technically, you would get less rewards, but that would be offset by the higher value.
Posted using Partiko iOS
I think that as long as it is possible to speculate on the STEEM token, it will always have some value.
But me I have a small SP but I thankfully for small gain
Posted using Partiko Android
I wish I would of seen this a year ago my account is worth 67 cents I think I am not getting the concept lol Thanks for teaching me about steempower and if you like crypto buy bitcoin it's going to be big in 2021
How could we collect SP aside from investing?
Posted using Partiko Android
Be active on Steem. Create articles, comment and vote on people who earn a lot from 8-15 minutes after adding their post. Then we get curator's rewards.
Steem power is the fuel of our steem account engine.
Thank you for sharing this information.
Posted using Partiko Android
tq to let me know this one
Posted using Partiko Android
Thanks for the brief and clear explanation without mysterious tech-talk!
Awesome breakdown! You set out to achieve, and achieve you did. I’ll be bookmarking this to answer future questions. :) thank you!
Congratulations @astromaniak!
Your post was mentioned in the Steem Hit Parade in the following category:
Excelent explanation for those all of us, like me, who are just starting at this wonderful world of steemit; thanks a lot
Excellent explanation, greetings and can see my first post presentation, that would help me a lot.
I was lost and now with your post have a much greater understanding. Thank you!
Thanks for this information