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RE: What is a Steemit Upvote? - An Illustrated Guide

in #toolkit • 7 years ago

Clear and enlightening, thank you!

But I have a concern about the reward pool and long-term sustainability. I gather the pool fluctuates with inflation and possibly with the currency market? You write "the percentage of yearly inflation shrinks incrementally as time goes on." So as Steemit users increase in number over time, won't that make the value of the pool shrink and difficult to sustain?

7 years ago in #toolkit by
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     7 years ago  

    directly alter the value of STEEM. (An important distinction.)Interesting question @kenfinkel! Inflation of the daily "rewards pool" increases the number of STEEM tokens held on the blockchain... but it does not

    From the Steemit FAQ page...

    Steem began creates new tokens at a yearly inflation rate of 9.5%. The inflation rate decreases at a rate of 0.5% per year. The inflation will continue decreasing at this pace until the overall inflation rate reaches 0.95%.

    So as the ecosystem of Steemit users increase over time, yes, STEEM tokens will be harder to come by. BUT the value of each of those tokens is another story. Ideally, the value rises as the demand rises. There are many other factors that give value to the STEEM ecosystem. If your next question is where does the value come from? This might help...

    Steem is a game system where users compete for attention and rewards by bringing content and adding value to the platform. The rewards people earn are tokens that have market value and are readily tradable. It is similar to how someone playing a video game could obtain a limited item or currency by playing the game. If the currency or items are transferable between users, then they can sell or buy them on game item markets.

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       7 years ago  

      Very useful.

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