Blockchain Startup Steemit Alters Economic Model Due to Community Demand

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Blockchain social media startup Steemit, has announced an impending hard fork that would modify the Steem Blockchain’s economic model to better benefit its existing community, and on-board more short to mid term investors. If the upgrade is adopted by the witnesses, the primary mechanism being altered is the inflation rate of the currency Steem. Traders and investors of the popular cryptocurrency will now have their Steem Power holding requirements reduced from an average of one year, to an average of one and a half months.

CEO of Ned Scott said:

“With this hardfork the greatest portion of the community feels the ecosystem will be changing for the better and will now be more accessible to more people. The hard fork request was initiated by the community, and once we reiterated the recommendations, we received an overwhelmingly positive response. The reason we built Steemit was to create not just a community where people could get rewarded for their time, creativity, attention and effort; but one where every user has a voice. The community has recommended improvements to the platform and we responded to help us all. We’ve always encouraged two-way dialogue with our user base and we feel that this will benefit all current and future users of Steemit.”

The changes to the economic model are believed to be able to enhance the stability of Steem and are expected to allow for a significant influx of new users who were previously excluded from participating across a short or medium term. There will be no change to the functionality of Steemit.com, Steem Backed Dollars or Steem Power, nor will there be a change in the powering down schedule or rate of the Steemit founders and developers.

“Steemit’s value and growth has been phenomenal, but it was hindered by a reliance on long term participants. The new structure of Steem lowers the inflation rate and adopts a model much more similar to bitcoin, which encourages participants who don’t want to lock up their cryptocurrency value for long periods of time to have influence in the social network. While all Steem holders will have increased liquidity, the allocation of new Steem tokens to witnesses, content producers and creators won’t change; that figure still sits at 9.5%.”

Of the 9.5% annual instantaneous inflation, Steem Power holders will receive 15%, 10% will be allocated to witnesses and miners, and 75% will be given to authors and content creators.

The hard fork is set to occur on Tuesday, December 6, 2016.

Here’s a recent interview with CEO Ned Scott:

 

About Richard Kastelein

Founder of industry publication Blockchain News, partner at ICO services collective CryptoAsset Design Group (helped raise over $200m+), director of education company Blockchain Partners (Oracle Partner) and ICO event organiser at leading industry event  CryptoFinancing (first ICO event in Europe) - Richard Kastelein is an award-winning publisher, innovation executive and entrepreneur. He sits on the advisory boards of half a dozen Blockchain startups and has written over 1200 articles on Blockchain technology and startups at Blockchain News and has also published pioneering articles on ICOs in Harvard Business Review and Venturebeat.
 
Kastelein has spoken (keynotes & panels) on Blockchain technology in Amsterdam, Antwerp, Barcelona, Beijing, Brussels, Bucharest, Dubai, Eindhoven, Gdansk, Groningen, the Hague, Helsinki, London, Manchester, Minsk, Nairobi, Nanchang, San Mateo, Shanghai,Tel Aviv and Venice. His network is global and extensive.
 
He is a Canadian (Dutch/Irish/English/Métis) whose writing career has ranged from the Canadian Native Press (Arctic) to the Caribbean & Europe. He's written occasionally for Harvard Business Review, Wired, Venturebeat, The Guardian and Virgin.com and his work and ideas have been translated into Dutch, Greek, Polish, German and French.
 
A journalist by trade, an entrepreneur and adventurer at heart, Kastelein's professional career has ranged from political publishing to TV technology, boatbuilding to judging startups, skippering yachts to marketing and more as he's travelled for nearly 30 years as a Canadian expatriate living around the world.
 
In his 20s, he sailed around the world on small yachts and wrote a series of travel articles called, "The Hitchhiker's Guide to the Seas' travelling by hitching rides on yachts (1989) in major travel and yachting publications. He currently lives in Groningen, Netherlands where he's raising three teenage daughters with his wife and sailing partner, Wieke Beenen.

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  • dragosroua

    There are a couple of small inconsistencies in the article:

    “Traders and investors of the popular cryptocurrency will now have their Steem Power holding requirements reduced from an average of one year, to an average of one and a half months.” -> the holding interval is right now 2 years, or 104 weeks, and in the new model it will be 3 months, or 13 weeks.

    “[…] nor will there be a change in the powering down schedule or rate of the Steemit founders and developers.” -> this is confusing. The founders announced they will not power down during the first three months after the hardfork gets implemented. Also, we don’t know anything about developers.

    Nevertheless, thanks for the article, from a Steemit user. I’m happy to see more information about this project.