Decentralized social network Steemit alters economic model

Decentralized social media network Steemit announced in a press release sent to CoinReport an approaching hard fork that would alter the steem blockchain’s economic model to benefit its existing community, and bring more short- to mid-term investors on board. If the witnesses adopt the upgrade, the chief mechanism being changed is the inflation rate of the currency steem. Investors and traders of the digital currency will now have a reduced Steem Power holding requirements – from an average of one year to an average of one and a half months.

Steemit CEO Ned Scott said in the press release, “With this hardfork the greatest portion of the community feels the ecosystem will be changing for the better and will now be more accessible to more people. The hard fork request was initiated by the community, and once we reiterated the recommendations, we received an overwhelmingly positive response. The reason we built Steemit was to create not just a community where people could get rewarded for their time, creativity, attention and effort; but one where every user has a voice. The community has recommended improvements to the platform and we responded to help us all. We’ve always encouraged two-way dialogue with our user base and we feel that this will benefit all current and future users of Steemit.”

The changes will expectedly improve steem’s stability and enable a noteworthy influx of new users, who were previously left out from joining across a short or medium term.

It should be noted here, however, that there will be no change to the functionality of Steemit.com, Steem Power or Steem Backed Dollars. Moreover, there will be no change in the powering down schedule or rate of the founders and developers of Steemit.

“Steemit’s value and growth has been phenomenal, but it was hindered by a reliance on long term participants. The new structure of Steem lowers the inflation rate and adopts a model much more similar to bitcoin, which encourages participants who don’t want to lock up their cryptocurrency value for long periods of time to have influence in the social network. While all Steem holders will have increased liquidity, the allocation of new Steem tokens to witnesses, content producers and creators won’t change; that figure still sits at 9.5%,” said the release we received.

Of the 9.5% annual instantaneous inflation, Steem Power holders will get 15%, 10% will be distributed among miners and witnesses and 75% will be given to content creators and authors.

The hard fork is set to occur on Tuesday, December 6.

Logo courtesy of Steemit via PR firm Wachsman PR