Digital currency is getting popular in its many varieties, whether it be bitcoin, ethereum, ripple or litecoin. As of this week, steem is being ranked with the rest of them.
The digital currency behind social media platform Steemit, which rewards users for posting content online, peaked at 1,000 percent growth. Since July 4, the value of steem currency surged from $13 million to a height of $130 million.
There had been smaller spikes, but this was the first time steem passed the DAO, the blockchain-based fund built around the digital currency Ethereum, according to Steemit CEO Ned Scott. It is now the world’s fifth most valuable cryptocurrency.
T he New York Business Journal reached out to Scott to find out what this means for his social network and the crypto currency space as a whole. Scott compared the phenomenon to "internet points" and how the business model of customer rewards has evolved into viable sources of revenue.
" Take Reddit for instance, which has Karma — Karma is just a points system, but those points don’t have real market value," he said. "Steem is the same thing but the points have real value."
This could ultimately lead to the gamification of social networking platforms and integrating them with the blockchain industry, he explained.
Scott co-founded Steemit with blockchain innovator and BitShares founder Dan Larimer.
By comparison, bitcoin's market cap currently hovers $10.5 billion, while ethereum is at approximately $860 million. Still, the hike in steem's value could mean Steemit is on its way to becoming a hit in ways other social networks haven't.
Scott added, “When people began to see that Steem was real and people were paying their bills and buying things like cell phones and washing machines with their earnings, that increased confidence and the rate at which users were bringing in their friends.”
While talks have begun at Facebook to allow users to monetize, but they're in the very early stages, it hasn't developed to the extent that New York-based Steemit has. The same can be said for other publishing platforms such as Twitter, Medium and Odyssey — none of which pay users for uploading content.
"I believe this is the beginning of a very big movement," Scott said.
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Exciting times! This is just the beginning. Hopefully steemit can maintain its first mover advantage.