DISCLAIMER This post reflects my personal opinion only; it does not constitute investment advice of any kind.
WIP Alert This is a work in progress. Current information is correct but more content may be added in the future.
STEEM is a blockchain focused on content networks whose main element, the Steemit Network, is a website for content producers and consumers, a là Medium. There's also d.tube, a decentralized video sharing platform.
All these networks built on top of STEEM use incentivize the creation and curation(i.e. sorting out good stuff from bad) of content using the network tokens such as STEEM Dollars and STEEM power.
STEEM is used as a means to convert between STEEM Dollars and Steem Power. It can be traded in regular exchanges such as Poloniex.
STEEM Power (SP) is STEEM that's been put at stake. It will generate dividends for you and it can be used to vote for content on the Steemit Network.
You can convert SP into STEEM by powering down.
You are paid with STEEM Dollars (SBD) for producing good content (i.e. when people upvote your posts or comments) on the Steemit Network. It can also be traded on exchanges such as Poloniex.
SBD is pegged to the U.S. Dollar because the system is guaranteed to give you as many STEEM it takes to make your 1 SBD worth 1 USD, if you ever choose to cash out to USD.
Powering Up and Powering Down
Powering Up means converting your STEEM into STEEM Power (SP).
Powering Down means converting your STEEM Power (SP) back into STEEM.
- Powering down takes about 13 Weeks as of this writing (Early February 2018). This means that during 13 weeks you will gradually receive 1 STEEM for every 1 SP you hold, if and when you decide to convert them.
You can stake STEEM Dollars (SBD) for regular yields (dividends), to the effect of 10% of the annual emmision of STEEM.
STEEM Power (SP) can also be staked, but for 90% of the annual emission of STEEM.
- This means SP accrues 9 times more interest than SBD.
You get some SP and some SBD when you get upvotes on content you produce.
You get paid when a post for which you voted gains in popularity later on. This is called curation rewards.
- Basically, if you are able to spot good quality content before the community as a whole notices it, you are awarded money for that.
- A short video (12 minutes) by one of STEEM founders. Very informative.