friend social media based economy. Our thesis is that the same techniques used to grow major social media
platforms can be used to bootstrap a successful cryptocurrency. Economic incentives enabled bycryptocurrency can dramatically facilitate the growth of a new social media platform. It is the synergy
between cryptocurrency and social media that we believe may give Steem a powerful advantage in the
market.
The challenge faced by Steem is deriving an algorithm for scoring individual contributions that most
community members consider to be a fair assessment of the subjective value of each contribution. In a
perfect world, community members would cooperate to rate each other's contribution and derive a fair
compensation. In the real world, algorithms must be designed in such a manner that they are resistant tointentional manipulation for profit. Any widespread abuse of the scoring system could cause community
members to lose faith in the perceived fairness of the economic system.
Existing platforms operate on a one-user, one-vote principle. This creates anenvironment where rankings
can be manipulated by sybil attacks and the service providers must pro-actively identify and block
abusers. People already attempt to manipulate the Reddit, Facebook, and Twitter scoring algorithms when
the only reward is web traffic or censorship.
The fundamental unit of account on the Steem platform is STEEM, a crypto currency token.
Steem operates on the basis of one-STEEM, one-vote. Under this model, individuals who have
contributed the most to the platform, as measured by their account balance, have the most influence over
how contributions are scored. Furthermore, Steem only allows members to vote with STEEM when it is
committed to a vesting schedule. Under this model, members have a financial incentive to vote in a way
that maximises the long term value of their STEEM.
Steem is designed around a relatively simple concept: everyone’s meaningful contribution to the
community should be recognized for the value it adds. When people are recognized for their meaningful
contributions, they continue contributing and the community grows. Any imbalance in the give and take
within a community is unsustainable. Eventually the givers grow tired of supporting the takers and
disengage from the community.
The challenge is creating a system capable of identifying what contributions are needed and their relative
worth in a way that can scale to an unbounded number of people.
A proven system for evaluating and rewarding contributions is the free market. The free market can be
viewed as a single community where everyone trades with one another and rewards are allocated by profit
and loss. The market system rewards those who provide value to others and punishes those who consume
more value than they produce. The free market supports many different currencies and money is simply a
commodity that everyone finds easy to exchange.
We have to work together to meet this challenge. Let's move forward together