Steem (STEEM)

Steem

Total supply	240,320,890 STEEM

Basics

• Started in: 2016
• Mainnet release:

• Steem is a social news service which combines a blogging site/social networking website and a cryptocurrency with it's own blockchain.
• Steemit.inc is the founding company of Steem, however there are multiple implementations and apps on the Steem blockchain.
• Got flack for banning someone from their website

From a Bitcoin.com post (4-8-2019) about decentralised social media:

• "Coming on scene as a pioneer in July 2016, Ned Scott and blockchain developer Dan Larimer’s Steemit boasted to be a first of its kind blockchain-based social media platform, allowing users to earn rewards via Steem for posting, curating, and commenting. Many users compared the site’s style to a kind of “crypto Reddit.” Larimer, the creator of the Bitshares DEX, DPoS (Delegated Proof of Stake Algorithm), and the current CTO of Block.one (EOS developer), built the site with co-founder Scott on the Steem blockchain, a Graphene-based, DPoS chain. While the site enjoyed initial, highly sensational success — with one well-known and controversial libertarian podcaster raking in $15,000 for a short “introduce yourself” post — user interest has since flagged significantly. A series of seismic management and corporate structuring shifts (including Larimer leaving the project in 2017), coupled with the crypto winter of last year, saw many loyal users searching out greener pastures. One thing that Steemit did help establish, however, was the potential of blockchain technology to provide relative censorship resistance and successfully reward users for engagement. Neither the platform nor other users could deplatform anyone by reporting or flagging a post (a huge problem currently for many giants in the field like Twitter, Facebook, and Youtube). And when the first payouts came in the summer of 2016, a massive wave of excitement ensued. However, troubles with spambots and abuse of voting power would prove to be significant challenges down the road."
• From CoinSpice (8-3-2020):

"STEEM is used mostly to reward and tip users of Steemit in upvotes, curation, and content creation. It was one of the first to demonstrate the concept with relative success back in 2016, but soon lost some of its luster during a hack not too long after. Steemit has stayed afloat and STEEM has had fits and starts with various pumps."

Token

Utility

• It is possible to buy "influence" which creates a small value-proposition.

Tech

• Whitepaper can be found [insert here].
• Code can be viewed [insert here].
• Built on:
• Programming language used:

Transaction Details

• Capacity (TPS):
• Latency:

Consensus Algorithm

• Proof of Work had a shady beginning.
• The platform employs a Distributed-Proof-of-Stake consensus model where 20 “Witnesses” serve as Block Producers and validate transactions across the network.
• Inflationary supply model, every year the monetary base doubles, but all three-and-a-half years the Steem reward per block is lowered at a rate of 1:10

Hivemind

• Technology by Steemit (5-2019):

"Hivemind, software that not only dramatically reduces the cost of running a blockchain node, but which also unlocks a universe of possibilities for social apps. Hivemind has the potential to offer the strengths of so-called “Smart Contracts” with almost none of the downsides. Hivemind will enable us to create Communities on Steem (among many other features), which is why it will play a critical role in the future of steemit.com, and the Steem ecosystem as a whole."

• From an Steemit blog interview (10-2019)

"The reason why we’re referring to it as “Hive Communities” is because we are talking about a feature set that is built using a piece of software you developed called “Hivemind.” Could you explain why it was necessary to build Hivemind before building Communities?

@roadscape: In layman’s terms, Hivemind provides a framework which is easier to develop and faster to iterate on; it bridges the gap between frontend and backend. Hivemind basically just stores posts in a traditional database, is written in Python, and allows you to process arbitrary events. Although Communities could have been written as a steemd plugin (in C++), leveraging standard web technologies makes development more flexible and accessible.

@andrarchy: Hivemind isn’t just limited to Communities-related features. From the sound of it, Hivemind can support a seemingly infinite number of feature sets. It almost turns Steem into a smart contracts platform, except without a lot of the downsides. Is that right?

@roadscape: Yes, Hivemind can do an infinite number of things. However, it’s important to keep in mind that Hivemind is geared toward social applications. Certain trade-offs were made that are important for developers to understand. For instance, hivemind trades consistency for speed and simplicity. To be as consistent as the blockchain itself would essentially require you to re-implement steemd in Python. Currently it is not equipped to robustly handle forks, thus, it is not ideal for wallets or financial transactions. For instance, to avoid inconsistencies due to forks, you could follow the last irreversible block, but then the data would all be a minute old. Alternatively, you could implement an undo database, though this would decrease capacity and make the system more complex."

Smart Media Tokens and ICO's

• From their news letter (23-10-2019):

"Live on TestNet, MainNet launch early 2020. SMTs are digital assets on the Steem blockchain that can be launched by anyone to help monetize online content and create incentives to encourage desired user behavior. Unlike Ethereum's ERC-20 tokens, SMTs have built-in ‘Proof-of-Brain’ properties and a token distribution reward system designed specifically for digital content businesses. This will also make ICO’s possible."

• Read the white paper here.

Governance

DAO

• From their own blog post (6-2019):

"The Steem DAO was a concept proposed by @blocktrades to allow Steem users to publicly propose work they are willing to do in exchange for pay. Steem users can then vote on these proposals in almost the same way they vote for witnesses It uses stake-weighted votes, but voters can vote for as many proposals as they want.

Steemit paid $50k USD to @blocktrades for the development of the SteemDAO. Once approved, and after enough time has transpired so as to demonstrate the security and stability of the system (about 1-2 weeks of operation), Steemit will provide initial, one-time funding, by converting 200k STEEM to SBD which will allow the market to test this new feature.

Long-Term SteemDAO Funding

At the request of the Witnesses, we have included code in this release that would add a long term funding mechanism for the SteemDAO/SPS. If this hardfork is accepted by the Witnesses, 10% of overall inflation (pulled from the rewards pool) would be used to fund proposals made through the SteemDAO/SPS."

• Update: SteemDAO has been 'purchased' by Steemit from Blocktrades (1-10-2019).

Steem.inc sold to Tron

• Steemit Inc. got sold to Tron on 14-2-2020:

“Steemit Inc., the largest decentralized blockchain-based social media and blogging platform, announced a strategic partnership with TRON Foundation,” the release states. “TRON and Steemit’s development teams will immediately begin working together to bring Steemit and other Steem blockchain-based DApps to TRON blockchain.

The Ask Me Anything video finds Tron founder Justin Sun in discussion with Scott, elaborating on the details and implications of the deal. In explaining why he sold the company, Scott stated he is “moving on for personal reasons” and that “there’s a couple other companies that I’m working on behind the scenes privately.” This is notable since one of the common criticisms of Steemit historically has been the project-hopping of leaders, with Bitshares creator Dan Larimer, who helped Scott create Steemit, leaving the project in 2017 to work on EOS development.

One user commented: “the community is very worried about what the next steps are and there is a lot of talk about a fork away from Tron within the Steem community as many members presently see this as a hostile take over by Tron and not a mutually beneficial partnership.”

Token Swap

In the AMA Sun commented (16-2-2020):

"I don’t think we have a plan for immediately like token swap, so I think we will keep both steem and the tron tokens separate and run separately … there is no token swap for right now … I just want to talk with the team and found out the best solution to integrate eventually for steem, Steemit, and Tron."

However the official press release is clear: “Together, TRON Foundation and Steemit Inc. will look to create further value for their users and to augment their advancements in decentralized technologies,” it states, “including moving old STEEM token to a new TRON based STEEM token.”

• From DAR Weekly (6-3-2020):

"The purchase of Steemit Inc, which is responsible for the development of the Steem cryptocurrency blockchain and maintaining Steemit.com, means Sun wields considerable influence over the consensus protocol. To counter this power, some Witnesses initiated a soft fork targeted at limiting the influence of users with large positions (i.e., Sun), formally known as Fork 0.22.2. The soft fork was meant as a reversible code update to provide the community more time to analyze the recent events.
However, Sun with the assistance of major exchanges Binance, Huobi, and Poloniex (recently acquired by Tron) used their stake of STEEM (native currency of the network) to prevent the soft fork as well as release the founders fund of STEEM, which accounts for approximately 20% of the circulating supply. Moreover, the funds were utilized to take over the majority voting rights and replace the previous Block Produces with loyal ones. The funds deployed by exchanges were determined to be those owned by individual users, who face a 13-week lockup period. As a result, a huge community backlash ensured, with the departures of multiple Steem developers as well as the Head of Communications.

Objectively speaking, since the announcement on February 14th, the STEEM token has declined 27%. As for the Steemit community, it has not only turned against Justin Sun, but also the very exchanges that aided in the takeover, despite Binance and Huobi citing misleading information."

• Binance and Huobi have since expressed regret for doing so.

“We don’t want to do this,” CZ insisted, because, “1 we don’t want to get involved in voting, 2 it is more work, still busy with staking. But if other witnesses are inclined to remove our users’ ability to vote in the future, we may be forced to implement it now,” and urged STEEM and Sun “work it out ASAP. Blockchains should NOT have freeze features.”

Upgrades

• 'Hardfork 21' (announced on 6-2019) introduced a bunch of new ways how content and curating will be rewarded. The funding mechanism of the SteemitDAO was also included. Some users were very upset about the new system of rewards and blamed the Witnesses that voted the hardfork in for voting for their own good and accused them of forming a cartel. Steemit.com itself praised the Witnesses for acting 'rationally and responsibly'.
• After Hardfork 21 was finalised, a bug made Steemit do Hardfork 22 very soon thereafter. (8-2019)
• From Decrypt (19-5-2020):

"A hardfork has been scheduled for May 20 which will seize the accounts and funds of former Steemit witnesses and stakeholders, and drain $5 million worth of STEEM coins from their wallets. The move is sanctioned by current Steem witnesses who have labelled the accounts in question as troublemakers."

• From Decrypt (21-5-2020):

"After the funds were seized they were sent to a designated wallet. But the person operating the wallet instead sent the funds—worth around $5 million at the time—to Bittrex. The coins were not sent to a specific person’s wallet, but to the exchange’s main wallet directly, meaning that the hero never intended to keep any of the coins. They also left a note for Sun on the blockchain, which said (in Korean), “Stealing is bad.”

However, on May 21, Bittrex initiated yet another major plot twist. In an official post titled ‘Response to the Steemit Situation’, Bittrex gave the distinct impression that they weren’t going to return the coins to the original holders."

Roadmap

• Can be found [Insert link here].

Audits

• Bug bounty program can be found [insert here].

Usage

Projects that use or built on it

• From CoinDesk (17-3-2020):

"The game Splinterlands, which is the most popular Steem dapp, according to Dapp.com, confirmed it would make the switch [towards Hive.io] once the chain was stable and the team had adjusted all the technology on its end."

• From Crypto Briefing (22-4-2020):

"Steem hosts 88 other DApps, the most significant of which are the trading card game Steem Monsters, the decentralized video platform DTube, and the Instagram-like photo-sharing platform APPICS."

• As of 20202 Q1, it has 103 Dapps, 88 of which are active, 6 were new and about 36K active users.

Pros and Cons

Pros

• Long track record and actually had traction among the non-crypto crowd.

Cons

• Has gone down a centralized path ever since Steemit.inc got bought by Tron.

Competition

Hive, a Steem Fork away from Sun

• Bloggers have been moving (19-3-2020) to Hive.io.
• From CoinDesk (17-3-2020):

"Everyone with tokens on Steem will also have tokens on Hive; that is, except for the Steemit wallets controlled by Sun’s Tron Foundation."

They will try to prevent exchanges from partaking in governance by the following;

"Basically, if a user on the new blockchain stakes their tokens, they won't be able to engage in governance votes for 30 days."

• From The Block (19-3-2020):

"Binance said it will support the hard fork, which is scheduled to take place tomorrow, and will distribute the new hive tokens to steem holders in 1:1 ratio. Huobi has also announced similar measures."

• From CoinDesk (5-3-2020):

"Witnesses on Steem have frozen eight accounts, putting a total of 17.6 million steem (worth approximately $3.2 million) in limbo. The accounts can be seen listed on GitHub."

• For a comparison of the two and a background of the situation, click here (22-4-2020).

Koinos

• From Cointelegraph (13-10-2020):

"Andrew Levine — who described himself as the Steemit “designated non-engineer” executive — co-founded OpenOrchard with six of his former teammates. The new-old team set to design a blockchain from scratch, Koinos, something of a Steem 2.0 that would fix all of its technical deficiencies."

Coin Distribution

• Community members have started naming users with different influence powers aka holders of Steem Power. Due to the common terminology of 'Whales' aka big owners of tokens, Steemit now has a plethora of different sea life. As one user described (8-2019) it:

"Redfish are those with under 500 sp. You get to be a minnow at 500-5000. Dolphin is at 5000-50000 sp. After that Orca to 500,000 sp and then whales above that."

Team, investors, Partnerships, etc.

• Steemit Inc. got sold to Tron on 14-2-2020.

• Larimer, Daniel; CTO & co-founder (also co-founder of BitShares), left the project to start EOS in june 2017.
• Powell, Elizabeth; Formerly the company’s head of communications and advocacy, now CEO (1-2019). "Powell is a relative newcomer to Steemit, having only joined the company last year. In response to her appointment, some users raised concern at her relative inexperience on the site."
• Scott, Ned; former CEO & co-founder (got replaced by Elizabeth Powell (1-2019) now executive chairman 
• Nerayoff, Steven; advisor
• After laying off (11-2018) 70% of it's staff it now (1-2019) has 12 full-time staff.
• Michael @vandeberg; "has been with Steemit since before its inception and oversees all blockchain development as Senior Blockchain Engineer. Michael has had a massive influence over the direction that Steem has taken and with the benefit of hindsight we have all seen the wisdom behind the difficult choices he insisted be made, and the folly of ignoring his warnings. His insistence on pursuing the utilization of RocksDB to migrate Steem to commodity-hardware well over a year ago is just one example of his foresight."
• @roadscape; "Senior Product Engineer, was one of the earliest additions to the Steemit team. He was also the developer behind steemd.com, the first user interface for accessing the information stored on the Steem blockchain. @roadscape went on to architect Hivemind, software that not only dramatically reduces the cost of running a blockchain node, but which also unlocks a universe of possibilities for social apps."

Lay offs and aftermath

• Had to lay off 70% of it's staff at the end of 2018.
• From their own blog post (5-2019):

"By releasing two state-of-the-art pieces of software (Hivemind and MIRA), reducing operating costs, improving the efficiency of our AWS infrastructure, and beginning our paid advertising program, we are now hitting our cost reduction and revenue projections. We have picked the majority of “low hanging fruit” with respect to cost reductions and restored the organization to a financially sustainable condition with a worst-case scenario operational runway that is more than sufficient to begin scoping future enhancements to the Steem blockchain and steemit.com."