Why Steemit Is NOT A Pyramid Scheme

You heard me, Steemit is NOT a pyramid scheme. To prove my point, I will discuss how a platform we're ALL familiar with, Facebook, would work if users were actually paid for their content.

But before I begin, it's important to note that at this moment Facebook does not pay anyone for their content. Also, I'd like to bring up the fact that Facebook currently has a $500 billion market cap. You heard me, a $500 billion market cap!

Facebook also has over 2 billion users, so when you do the math, each Facebook user is valued at $239. Meanwhile, Steemit has a market cap of $250 million and according to @vegansilverstack two months ago, Steemit had 171,515 users.

When you divide Steemit's $250 million market cap by 171,515 users, it means each user is valued at $1,458.

So in a monetary sense Steemit users are clearly more valuable than Facebook users. And when you consider the fact that Facebook users get paid zero dollars for their content by Facebook while Steemit users actually get paid, Facebook users are not even in the same universe as Steemit users.

The only catch though is that some Steemit users get paid FAR MORE than other Steemit users, namely newer Steemit users (like myself). We'll get to that part later...

But let's get back to the hypothetical scenario where Facebook pays its users for their content...

If Facebook paid its users for their content, the amount each user got paid would vary similar to how payout amounts vary between Steemit users. Think about that person on your Facebook who posts a basic picture of themselves (i.e. hot chics haha) and gets 400 'likes,' while someone else on your Facebook only gets a mere 5 or 6 'likes' when they post a picture.

Clearly in the examples above, one user is engaging and piquing the interest of more users than the other. So if users got paid based upon user engagement, clearly some users would be making a ton of cash while other users would make next to nothing.

Therefore, users getting paid a lot more on Steemit than others is not the result of a pyramid scheme; it's just simple economics.

As Steemit grows its userbase, more and more advertisers will want to get a piece of the audience to promote their products/services. As a result, more money will be pumped into Steemit and that money will then partially be redistributed to users who add original content, especially users who engage lots of users.

Sure, it's somewhat unfair that newer Steemit content creators get paid next to nothing while older Steemit content creators get paid a boatload, but Steemit is not a socialist system. Steemit's model uses simple, common sense economics and as a result users are incentivized to put their all into creating original content. The more competition and the more effort people put in, the better Steemit will be in the long run for everyone.

Since I'm new, my only criticism is that Steemit should create more possibilities for new content creators to create audiences, boost their reputation and influence, but again, I'm not really complaining. I understand that its my responsibility to take care of myself on this platform and I'm not looking for a handout. When I have a ton of followers one day and I'm making $400/article and my friends are hating at all the money I'm making, I will point out that I ended up where up I am not because of a pyramid scheme, but because of hard work and perseverance.