Steemit Economy Explained

Steemit
An incentivized, blockchain-based social media platform.

The problem as I see it with Steemit, is that the concept is just too hard to grasp. There are too many confusing concepts. For example, you have Steemit which is the platform, Steem – the digital currency, Steem power, Steem dollars and it all becomes one big mish mash of unexplained terms. In the end the average user who wants to get started with Steemit is left confused and leaves the platform.

Steem – Is the basic cryptocurrency used to power this whole system. It’s like the bricks used to build Steem Dollars and Steem power (will be explained in a moment). You can buy and sell Steem, speculate on it’s price or convert it to Steem dollars and Steem power. But if you’re not looking to speculate on the price or if you’re not cashing out your Steemit earnings, you don’t need to deal with Steem directly.

Steem dollar is just an IOU (I owe you) – if and when you decide to cash out of your Steem dollars, you will get however many Steem it takes to get to that value in USD. There’s also an interest acquired on any Steem dollars left in your account (currently 0% a year). This is done in order to incentivize people to leave their Steem dollars in their account.

Steem power – Also known as SP in short, is basically a token symbolizing how much influence you have inside the Steemit platform. If you have a lot of SP your upvotes will count more and will award different authors SP and Steem dollars as well.

Powering up – means getting more SP either by upvotes or by buying it via Steem.

Powering down – means liquidating your SP into Steem.

Powering down is a process that takes 13 weeks , and it will transfer your Steem Power into Steem every 7 days for next 13 weeks

I hope i helped you and sorry for grammatical mistakes English isn't my primary language ;)!