SteemIt is extremely complicated, even for more experienced users. I've seen a lot of users making mistakes and/or spread incorrect information. To help everyone better understand the platform, i made a list of some of the most common mistakes and misconceptions I've noticed:
Steemit.com
While it is true that steemit.com is a website, it doesn't mean that SteemIt is a website! I know it's confusing, but i'll explain. SteemIt is running on revolutionary new blockchain technology. Steemit.com is what they call a front-end, GUI or client. It's merely communicating with the actual authoritative application, which is the server (in this case the STEEM blockchain). "SteemIt" is the name of the social media platform running on the STEEM blockchain.
Unvoting
I see a lot of people trying to undo their votes. In the current implementation of SteemIt you can never get your voting power back. Once you voted, that voting power is gone. So be sure to think about your votes very carefully!
Upvote rewards
A common mistake i see people make is assuming their vote is solely responsible for the change in rewards. It important to realize that on steemit.com the rewards don't update in real-time. So if you either vote or refresh the page these factors can influence the rewards:
- All incoming votes/flags that happened between the time you first loaded the page and the time that you voted/flagged or refreshed the page.
- The STEEM price (on the internal market). Unfortunately i don't have the exact details of this process, but it's very apparent that the rewards change, even without any votes/flags influencing it.
- Votes and flags on all other content (the details will be explained below in the reward pool section).
Reward amounts
The price in Dollars that is visible on content isn't the price the author will receive. That amount is divided between the author and the curators. While it's theoretically possible that the author will get 100%, in reality authors receive approximately 81% of the visible amount on average (the more popular the author, the higher portion of the rewards usually goes to the author).
Rewards can be paid out either 50% in SBD (STEEM Backed Dollars) and 50% in STEEM POWER or 100% in STEEM POWER, dependent on the choice of the author. In certain cases you will get rewards in STEEM on top of SBD.
Editing your content
Since your data is saved on the blockchain, it's permanent. In fact, every single mutation is permanent. If you edit your content, all previous changes remain in the database forever. Once published, the information can never be removed. SteemIt is completely uncensored!
Voting on old content
In the current implementation of SteemIt, you cannot assign rewards to content older than 6 days and 12 hours. When you upvote content in the last 12 hours of the first 7 days, you will get an error that you can only flag that content. After 7 days you can upvote the content, but it will not cost voting power, nor does it assign rewards to the content, so it's basically identical to a Facebook like at that point.
Reputation
A lot of people think that this variable represents the user's content quality, integrity and popularity. This is not exactly true. Reputation exclusively represents how much rewards a certain user has received, whatever the reasons may have been. In fact, you can even increase your own rating by voting on your own content.
The reputation score is based off of a log10 system, which means that a score of 40 is about 10x better than a score of 30.
Upvoting popular content
A lot of people focus on trending content and upvote content that has already made 100's of Dollars. In reality you will earn smaller curation rewards by doing this! I highly recommend reading my article Curation rewards explained in great detail to completely understand why this is!
The reward pool
Starting with the network's 16th hard fork in December 2016, Steem began creating new tokens at a yearly inflation rate of 9.5%. The inflation rate decreases at a rate of 0.01% every 250,000 blocks, or about 0.5% per year. The inflation will continue decreasing at this pace until the overall inflation rate reaches 0.95%. This will take about 20.5 years from the time hard fork 16 went into effect.
How are the new tokens distributed?
Out of the new tokens that are generated:
75% go to the reward pool, which is split between authors and curators.
15% of the new tokens are awarded to holders of STEEM Power.
The remaining 10% pays for the witnesses to power the blockchain.
After reading the explanation from the FAQ above , you could calculate the daily inflation at the moment. Let's assume the current inflation is approximately 9.3% per year. At the time of writing the current STEEM supply is 250,864,825.923. 9.3% of that is 23,330,428.725. Divided by 365 days that is 63,919. That means today there is approximately 47,940 STEEM in the reward pool (75% of 63,919). At the current STEEM price of approximately $1.75 that is approximately $83,895 per day available in the reward pool to spread around among authors and curators.
Every user has the ability to assign their portion of that $83,895 to users, based on their STEEM POWER. Every user has the ability to distribute 20% of their total voting power on average each day. The way this process works is that the more users actively use their voting power, the smaller your portion of the reward pool is. It's theoretically possible to be the only curator that is curating that day, in that case you have full control over the whole $83,895!
STEEM Backed Dollars are worth $1.00 USD
This is absolutely not true. SBD is traded on the open markets. The current value of SBD is over $1.50!
It takes days to convert SBD or STEEM
This is actually only true when you use the internal conversion system. When you use that system it takes longer to make sure you get the average rate of that period. This is more useful for users that don't trade markets.
If you want to trade immediately, you can freely trade SBD and STEEM on the internal market or external exchanges like Poloniex and Bittrex!
STEEM POWER gives you 9.5% annual interest
This is actually not true. Putting your money in STEEM POWER makes you immune to just STEEM POWER Inflation. As mentioned above the STEEM inflation is currently around 9.3% per year. Only 15% of the created STEEM goes to STEEM POWER holders. So currently you only receive approximately 1.4% more STEEM POWER per year, not 9.3%.
Savings rewards you with interest
This is actually not true. Putting your money into savings is only to prevent potential hackers from withdrawing your funds immediately. That way you have 3 more days to realize you have been breached.
STEEM is a Ponzi-scheme
This is a common misconception. In reality the STEEM currency is a currency with a limited supply, similar to Bitcoin. In theory everyone in the world could use this currency as money and trade it for goods and services. It's irrelevant what the value of STEEM is in Dollars, Euro's, Yen or any other fiat currency.
Don't forget to follow, resteem and browse my channel for more information!
Wow, had no idea about the unvoting and losing rewards, good to know! This was an extremely helpful post, thanks a ton.
Very informative and nicely written. Good content! Maybe you can writing something about upvoting your own comments, is this advised or not:) Also, I see my name on the top under vote, is that because I voted with the much voting power?
Already did that 6 days ago: Self-voting needs to be addressed.
Sweet:)
Yes, it's ordered by STEEM POWER.
Some good info here
Excellent post. Contextualizing all of the misinformation is very helpful. Thank you.
So the reward pool is decreasing each day but why the reward is getting lower that has been assigned 4 days ago. Like $16 has been reduced to $12 and keep getting lower with every hour. Why is that?
As the article explains, it's because the price of STEEM is dropping.
Yes but it has not dropped more than 20% and now stable but it is still going down.
Lets say if the steem value increase 100% in next month (example only) . Then reward and voting power will increase? As my voting value decresed from $0.10 to $0.07 now
The rewards will change based on the STEEM price, so yes :)
There are other factors though, so if STEEM drops 20%, it doesn't mean your rewards will drop by exactly 20%.
Thanks mate with explanation
This comment has received a 0.13 % upvote from @booster thanks to: @cryptokraze.
This comment has received a 0.13 % upvote from @booster thanks to: @cryptokraze.
Phenomenal work! Definitely worth an upvote and resteem!
Thank you @calamus056. This was very informative. I have a question please:
How is the effect of the upvote on the rewards calculated? I specifically want to know the relation between Steem power and the amount of the reward it produces.
Can you please help me with that ?
STEEM POWER is STEEM locked up. There's a limited amount of STEEM available. Everyone that powers up STEEM gets a share of the reward pool. Having STEEM POWER gives you the ability to assign a certain part of the reward pool to content. Does that clarify it?
Thank you @calamus056. Actually, I knew that.
What I want to know is the exact formula used to calculate the upvote value. For example, if a user with 1000 SP upvoted me, how much would that give me in terms of rewards?
Oh, i don't think you can accurately calculate that since it's based on how many people are using their voting power.
Currently it seems to be around $0.000425 per SP. Haven't figured out the formula myself yet.
Oh! I see. Thank you anyways.
Great advice! Keep it up! STEEM ON!
Information rich article. Every minnow and newbie will need to read this. I like how the points are articulated and presented. Welldone.
Those titles only represent the amount of STEEM POWER they own, not their knowledge. Everyone could benefit from this information :)
Thank's for all of this info. You are right there is a lot of misinformation out there. Thanks for mentioning the external exchanges. One question, if I were to use bittrex would I be able to somehow load money to a debit card and convert it to USD?
I don't know how Bittrex works, but their are several ways to move this over to USD on a debit card, or bank account.
Highly appreciated information, following you but recharging. Thank you again.
Thanks for the very informative post. Infact, it is top useful post on steemit I have read so far!
Being new to the platform, I have some users keep upvoting every single article and comment. Does it affect their voting power?
And secondly, I have seen that some posts earn some amount and then it keeps decreasing day by day! What is this and how to avoid it?
Thanks again for the great help.
That is very good info for a new steemit user like me thanks and keep up the good work :-)
Great post. Answers a lot of questions newbies have.
Not only for newbies :)
Agree @calamus056! Been here a few months and still learning from great posts like this! keep BOOMIN!
Isn't BSD a Unix distribution? :)
Wonderful explanation, is there any system where we can report persons who are spreading incorrect information on this platform?
Yes there is, it's called the comment section :)
Right, so we should report a person's incorrect information on his own post by commenting like hey dude, this is incorrect (sarcastic clap)
BTW, I was asking about any official channel where we could report such people.
Thanks though!
meep
I was also thinking about this. If ever we mention a mistake a person has made, how do we ensure they update their post? Since on blockchain, you cannot permanently delete a post, how do you proceed to hiding a post?
This is amazing! For the past week, I had wanted to find out how Steem rewards work, and bing! This shows up on my promoted page... A really wonderful article! Thanks a lot...
Thanks. Make sure you read my article about curation rewards too.
Yes, I read that as well. Pretty amazing stuff!
I've been here close to a year, but have become more active recently.
Same here, i came back a month ago. SteemIt is much better now and still getting better each month.
I've been on here for a few months already, and had only really figured out about half of this on my own. Thank you for some clarity.
Now I just have to figure out the equation for being creative with my content. :^)
It took me 100's of hours and lots of days with little sleep ;)
SteemIt is extremely complicated.
Thanks for clearing those things up for me. I am fairly new to steemit but I am totally intrigued by it!
Great post i just learn some new things good work really good job man
Great post, Upvoted and followed.
Well written calamus056. Very clear, concise and easy to understand.
Thanks for the info.
That upvoting old content does not reward is disturbing.
I can see past author and curator rewards that were paid out.
Upvoting such a blog indeed does not add anything.
That misguides into bringing sensational blogs that catch attention today which nobody cares for next week.
Yes, I too don't like the fact that there is this 7 day expiration date, as it would seem to encourage sensationalism just to grab attention to cash in quickly. Fortunately, I haven't actually seen too much of this behavior, but I would like to know what the reason is for the 7 day time limit. Does anyone know what its intended purpose is?
Yes it is, i hate it. It makes me stop working on my articles way way faster. I still work on them for hours though hehe.
You have good quality content. Keep it up bro.
Yeah, that's a shame. I didn't know that. I wonder if they will change it in the future. .. So , does that mean that older posts can't earn you anything?
Yea, it makes the posts much more ethereal and much more important to get hot or trending. It doesn't ready reward keeping good content on steemit.
Just logged on and hit Gold! Thanks for the info. Just what I needed to get started!
This post is Very useful thank you
This information is real eye-opener. Thank you.
Nice, post i will stalk you :p (kidding just following you)
Stalking is fine too :p
How can know about the voting power of mine? Sorry i am new here.
https://steemd.com/@time4rise 17th row on the left.
Have any limitation to submit story / comment/ upvoting?
how can know about my voting power? sorry i am new here.
Also i see i wrote 2 comment separately here but showing one. why? it's the rules to comment only one in one post?
Only to upvoting/flagging. Currently it's recommended not to vote/flag more than 11 full powered votes per day.
The penalty on more than 4 submissions a day has been removed, so it's "unlimited" again. Comments always were "unlimited".
Hey, @calamus056 great post man!
very informative and thanks for sharing and also a word of appreciation for your style of writing. Resteemed and Upvoted :)
I believe ICOs are the new IPOs
Cryptocurrency exchanges are the new forex exchanges
Bitcoin, Ether, Steemit ... are the new precious metals
Put your money where the party is.
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Thank you for your helpful information..
Excellent read! As a newbie here, this has answered a lot of my questions.
Thank you!
-Kim
Helped me so much thanks!
hvala ok
Steem is very confusing, complicated, but it's way better than Facebook!
So I'm here to stay and learn.
nice article
Excellent content for the new comers, thanks for stitching it together.
Well written guide! I will resteem so hopefully more people can see!
This is an amazing post to someone completely new. I still do not understand voting power though. Am i only allowed to upvote a specific amount of posts per day?
You can vote 100's of times per day, but then you've spent 99.9% of your voting power. It takes 5 days to recharge. Its advised to vote 11 full powered votes per day (to keep voting power over 80%).
http://www.steemd.com/@magnifico to see your voting power (17th row on the left).
Omg, all this great info I didn't find somewhere else! Thank you so much! I'm also trying to understand the mechanisms of Steemit, which I absolutely love. I was just wondering about this voting power, thanks.
So, what is the most important factor you should be after as a Steemer - growing your steempower/uvoting/resteeming/having more followers/putting money in savings ?? I'm still a bit confused on what is affecting what. Will read about it more, but this I haven't found yet.
btw you picked and interesting plant as your nick, cool :)
This is a helpful content and answered some things that were on my mind.
Great work, bud.
Xx? :)
lol I'm never gonna get away from that now!
That is correct :)
laaaaawl
Awesome. thanks for droping that..! I am #resteeming it.
Thank you for this information. I will read it again to absorb more information. Upvoted and Following
thank ypu so much. it makes me understand better of the system. yet there is alot to understand in the new world for me.
thanks! I wondered why the rewards were keep decreasing without any changes in votes.
Great article. Many thanks. I am starting to come to grips with most aspects of Steem now!
Great for newbies!! I've just joined so thank you very much kind sir, there's a tonne to learn on STEEM.
Interesting and useful - thanks! :)