Hi, Steemit has recently gained quite a lot of attention and there are lots of newbies out there who don't know or understand Steemit.

What is Steemit?

Steemit is a social network which works similarly to Reddit, but instead Steemit pays both the content creators when their work gets upvoted, as well as the people who curate content on the site by upvoting others work.

Steemit is built on a new kind of cryptocurrency. (https://en.wikipedia.org/wiki/Cryptocurrency)

Each and every day new bits of this currency are created and distributed to all of its users. These bits can be converted to real money to use in the real world.

Steemit allows you to create an account for free, and you can instantly start publishing posts that are valuable and useful to all its users.

How does Steemit work?

Steemit is similar to other cryptocurrencies and can be traded, bought and sold however there are some differences between them.

With most of other cyptocurrencies you have to mine these bits with special rigs and software and this could be very expensive and uses a lot of electricity and can sometimes be unprofitable. The more computing power you have with these rigs the more money you make.

You can also mine Steemit but the main way to earn it is through posts and upvotes. The more you engage with this site the more money you make.

By creating content you get rewarded. People who upvote content are rewarded for helping to curate. Commenters who add to the discussions are paid too.

Steemit currency units.

Steemit has 3 different types of currency units. They are Steem, Steem power, and Steem Dollars.

Steem:

Steem are the units that are bought and sold for actual money on the open markets. You can trade them like other cryptocurrencies such as bitcoin.

Holding onto Steem units can make them lose value.

Steem power:

Steem Power is like making a long-term investment and you can't sell them for 2 years. However, there are some reasons to have them .

By keeping your currency as Steem Power Units, you will be able to make considerably more money in the long run because you essentially have ownership in the network. As the network grows, so will your Steem Power units.

Steem Dollars:

Steem Dollars never lose their value. They are designed to be stable and you can sell them whenever you want. If you create popular content, about 50%(I may be wrong) of your pay will be in Steem Dollars. Holding onto Steem Dollars rewards you too but you will earn less than Steem Power.

When you earn Steem Dollars you have 3 choices:

You can convert the Steem Dollars to Steem and sell it immediately on the open market for real money.

You can exchange your Steem Dollars for Steem Power. If you want to invest in the future of the currency and reap the biggest rewards, this is the way to do it.

You can hold the Steem Dollars, which keeps the money in the network and pays you 10% interest. You can sell them at any time. If you think the value will go up and want to sell at some point in the near future, this is your best option.

How to cash out your Steem?

To cash out your Steem you would have to convert it to bitcoins and from bitcoins to cash. There are tutorials elsewhere on Steemit on how to do this. Just type "how to cash out Steem" in the search bar.

Upvote this post and comment if you still need an explanation on how Steemit works