Is the Steem Blockchain the Future of Content Monetization?

Content creators worldwide constantly seek new and innovative ways to monetize their work. While traditional media platforms provide some opportunities, many feel their efforts should be more valued and rewarded fairly for the required time and skills. Enter Steem – a blockchain project aiming to change how digital content is rewarded by putting control and value back into the hands of creators. The Steem blockchain presents an alternative model for online publishing that directly connects creators and their fans in a cooperative economy. Instead of relying on intermediaries like websites, advertisers, or investors, the Steem platform allows anyone to get paid for the quality and popularity of what they share. Powered by its native cryptocurrency, Steem, the project empowers users to own their work and monetize their contributions in a fair, transparent system.

How Does the Steem Blockchain Work?

Under the hood, Steem utilizes blockchain technology similarly to other decentralized networks like Bitcoin and Ethereum. However, its core functionality is explicitly tailored for content sharing and creator economy applications. The Steem blockchain runs on a proof-of-stake consensus protocol that rewards users for participation through vesting and curation rewards.

Content on Steem is organized around communities known as chains, with the flagship Steem chain being the largest. Users can join any chain and freely post, comment, vote, and earn rewards in Steem cryptocurrency called STEEM. This currency has actual value traded on exchanges, allowing monetization of contributions. The more upvotes or “likes” a post receives from the community, the larger the payout is split among the author and curators. There is also a tiered approval system where only top members can pay more significant amounts.

This unique economic model aligns the network’s incentives in promoting only high-quality, valuable content. As more people engage with a post through upvotes, the more enormous rewards are for all parties involved. The transparent public ledger ensures fairness through visibility into payouts. Overall, the Steem blockchain achieves its goal of putting content monetization power directly in the hands of creators and their supporters.

How Steem Blockchain Produces A New Block?

Steem, a blockchain-based social media platform, employs a Delegated Proof-of-Stake (DPoS) consensus mechanism to generate new blocks. This innovative system involves a set of 21 elected witnesses who validate transactions and create partnerships. Let’s delve into the intricate process through which the Steem blockchain produces a new block.

Block Production Process

DPoS is a consensus algorithm designed to address the scalability and energy consumption issues faced by traditional Proof-of-Work (PoW) systems like Bitcoin. In Steam’s DPoS, users can vote for witnesses—trusted nodes responsible for validating transactions and maintaining the blockchain’s integrity. These witnesses play a pivotal role in block production. The steps used in this process are- 

1. Witnesses Election: Users cast votes to elect 21 witnesses from a larger pool of candidates. These witnesses represent the network’s top-tier block creation and validation nodes. The voting weight of users is determined by the amount of Steem Power they possess.
2. Block Generation: The 21 elected witnesses take turns producing blocks round-robin. Each block has a fixed time slot, and witnesses create one block per round.
3. Transaction Validation: When a witness’s turn arrives, they collect transactions from the mempool—a pool of unconfirmed transactions. The witness verifies and validates these transactions to ensure they adhere to the network’s rules.
4. Block Assembly: Once the transactions are validated, the witness assembles them into a block. The block includes transaction details, a timestamp, a reference to the previous block, and the witness’s digital signature.
5. Consensus Verification: Before broadcasting the new block to the network, the witness obtains approval from at least 15 out of 21 elected witnesses. This multi-signature approval process reinforces the block’s validity and prevents fraudulent activities.
6. Broadcasting the Block: Upon receiving sufficient endorsements from other witnesses, the block is published across the Steem network.
7. Adding to the Blockchain: Once the block is broadcasted and validated by the network, it becomes part of the Steem blockchain, extending its history and recording the latest transactions.

Technical Considerations

Some of the technical factors to be considered in this process are- 

• Block Time: Steem aims for a block time of 3 seconds, ensuring rapid transaction processing and network responsiveness.
• Witness Rotation: Witnesses change positions regularly based on their votes. Those with higher support tend to produce more blocks, while others may have intermittent opportunities.
• Rewards for Witnesses: Witnesses receive tips in the form of Steem tokens for their service to the network. It incentivizes them to maintain honesty and reliability in block production.

Steem’s DPoS consensus mechanism, powered by elected witnesses, orchestrates the creation of new blocks in the blockchain. Through this democratic and efficient approach, Steem ensures fast transaction throughput, scalability, and decentralized governance. The dynamic interplay between witnesses, users, and transactions forms the backbone of Steam’s robust blockchain infrastructure.

Benefits of the Steem platform

For creators, the Steem blockchain provides an alternative monetization channel with several critical advantages over traditional social platforms:

• Complete ownership: Creators fully own their work and associated intellectual property uploaded to Steam. They also retain control over distribution through a permanent, uneditable public record on the blockchain. It is unlike centralized platforms where ownership lies with the company.
• Direct rewards: Creators get paid directly in STEEM cryptocurrency based on the value their fans assign through upvotes. There are no opaque algorithms, third-party advertisers, or subscription fees cutting into profits. Payments happen seamlessly through the open blockchain.
• Transparency: The Steem blockchain is transparent, making the payout process and upvote values visible for accountability and proof against hidden manipulations. Creators know precisely how much support their work receives.
• No censorship: It is decentralized, and no single entity can censor or delete content on Steam. Creators enjoy complete freedom of expression and accessibility to their audience globally.
• Low barrier to entry: Anyone can join Steem and immediately start earning rewards with no restrictions. It empowers more diversity in voices and gives new and established creators equal opportunities.

For fans, the key benefit is their direct involvement in supporting creators. By engaging and upvoting content they value, fans actively promote high-quality posts and fairly compensate those who bring them value through their work. Together, the Steem community directly funds the creation of knowledge, culture, and conversation online.

Growing Community

Since launching in 2016, Steem has steadily grown its community to over 1.3 million users, creating digital content across various communities or chains hosted on the network. According to data site Stee, the flagship Steem blockchain remains the largest and most vibrant. It has also become a bustling social media platform in its own right. Categories range from writing to photography, coding tutorials to gaming. Popular topics include cryptocurrency, technology, lifestyle, memes, and sports. Mainstream journalists and influencers like blockchain expert Andreas Antonopoulos regularly contribute thoughtful discussions.

While still a niche compared to giants like YouTube, Facebook, or Reddit, Steam’s community continues growing organically through word-of-mouth. Participation swells as more creators find the platform’s value proposition appealing and the ability to make a living from their work. Meanwhile, core contributors accumulate significant ownership stakes over time through curation rewards that strengthen their voice in the network’s governance.

With an improving feature set and apps continually built on its open API, the Steem ecosystem matures into a vibrant alternative for creators and fans alike. Only time will tell if the vision of an open, community-owned sharing economy powered by blockchain can achieve mainstream adoption. But for now, Steem presents a ray of hope for those seeking to control their online contributions and thrive from their creative talents.

Challenges

Of course, like any novel technology still in the early stages, the Steem blockchain also faces challenges that could impact its long-term prospects:

• Liquidity: Limited trading volume and liquidity for STEEM on exchanges means it can take time to cash out large amounts instantly. This issue may deter some from fully utilizing the platform.
• Onboarding complexity: The learning curve to understand blockchain, wallets, voting, and other mechanics presents a high bar for mainstream consumers. Steem must simplify the experience to reach a wider audience.
• Network effects: With critical mass, smaller communities on niche chains may find it easier to be self-sustaining long-term if user counts drop. Network effects are crucial for any social platform.
• Competition: While unique in its value proposition, Steem must also compete against dominant incumbent platforms and newer decentralized social networks for mind and market share over the long run.
• Regulation: Steem operates in a regulatory gray area globally as a cryptocurrency platform. More precise rules and compliance will become essential for mainstream viability and user confidence.

Nevertheless, Steem’s committed developer community actively works to address these challenges through product improvements, outreach initiatives, and industry advocacy. Significant progress so far gives hope that many hurdles can be overcome for the Steem blockchain to realize its full potential as a sustainable technology powering the next generation of online content monetization led entirely by creators and their supporters.

Who Can Benefit from Steem?

Steem, as a unique blockchain-based social media platform, offers a range of opportunities for various individuals and entities, fostering an ecosystem where diverse participants can benefit in different ways.

Content Creators

• Bloggers and Writers: Those passionate about creating content, whether articles, stories, or informative pieces, can leverage Steem to share their work. Through the platform’s reward system, creators receive compensation based on the engagement and value their content generates.
• Artists and Designers: Visual artists, graphic designers, and illustrators can showcase their work on Steem, receiving rewards for their creations. Art-based communities on Steem appreciate and support artistic endeavors, offering exposure and potential income.

Entrepreneurs and Developers

• DApp Developers: Steem’s blockchain allows developers to create decentralized applications (DApps) within its ecosystem. These applications could range from content discovery tools to decentralized finance (DeFi) apps, leveraging Steem’s infrastructure for their projects.
• Entrepreneurs: Steem’s decentralized nature provides an innovative environment for entrepreneurs to explore new business models. By integrating their services or products with Steem, they can tap into a community-driven ecosystem, reaching a global audience.

Investors and Traders

• Cryptocurrency Investors: Steem’s native cryptocurrency, STEEM, offers investment opportunities. Investors can buy, hold, and trade STEEM tokens on various exchanges, potentially benefiting from price fluctuations and market dynamics.

Community Participants

• Curators and Voters: Steam’s reward system incentivizes users who discover and promote quality content by upvoting. Curators voting for valuable contributions earn rewards in the form of STEEM tokens.
• Witnesses: Elected witnesses, responsible for block production and network validation, receive prizes for their services. Those actively maintaining the blockchain’s integrity and functionality can benefit from their contributions.

Content Consumers

• Readers and Viewers: Users who consume content on Steem benefit from the diverse range of topics and high-quality material available. They can explore content across various niches, curated by the community, and engage with creators through comments and votes.

Steem’s inclusive and decentralized platform offers multifaceted benefits to a broad spectrum of individuals and entities. Whether content creators seeking recognition and compensation, entrepreneurs exploring new business avenues, or users engaging with valuable content, Steem fosters an ecosystem where participation and contribution are rewarded. The platform’s innovative approach to content creation, curation, and decentralized governance creates opportunities for diverse stakeholders to thrive within its dynamic community.

Conclusion

While still in relatively early stages compared to Web 2.0 giants, the Steem blockchain presents an intriguing vision for rewiring how online content is created, distributed, and rewarded. By consolidating incentives through its novel economic model, the network directly aligns all participants – creators, curators, and fans – toward cooperation and prosperity. With ownership of data and fair compensation at the heart of its system, Steem promises a more equitable future for all who share and consume knowledge online.

Whether this decentralized, community-owned approach can achieve the scale required for mainstream impact remains to be determined. But for now, Steem provides a real-world proof-of-concept for an alternate virtual sharing economy led entirely by participation rather than third-party interference. For any creator or user seeking more control, transparency, and ownership over their online contributions, Steem blockchain bears watching as one of the boldest experiments toward that future. Only time will tell where its innovating journey leads in the years to come!