Steemit Founder: Bitcoin Mining Model is Fountain of Youth for Mainstream Media

JAN 31, 2017
By Alicia Naumoff
Steemit Founder: Bitcoin Mining Model is Fountain of Youth for Mainstream Media

332 Total views 362 Total shares

The current business model of social media doesn’t extend profits to the creators of the content. Besides, it is susceptible to censorship, as actors with enough power can exert pressure to block users or content that they don’t like.

“The mainstream media has lost power recently thanks to free speech enabled by the Internet,” explains Dan Larimer, Co-Founder of Steemit. “Fake news frequently circulate our media feeds, causing platforms and outlets to lose value and power. In response to this, they are proposing censorship as the solution, yet censorship does not give people the opportunity to think for themselves.”

The power to censor, in his opinion, is perceived by the masses as the power to manipulate. Fake news also has the power to manipulate the reality of anyone who fails to consider all options.

Cointelegraph spoke to Ned Scott, Steemit Founder, about the company’s new roadmap, the lessons from the hack, fake news, censorship and the future of media.

An economic model similar to Bitcoin mining
The Blockchain is able to significantly reshape the industry and benefits of it are becoming more and more obvious. It comes right in the center of the problem allowing to build a decentralized, censorship-resistant, open, honest and transparent platform – the haven for journalists, bloggers, artists and creative content producers.

Steemit is set out to fix two main issues that exist nowadays in social networking websites: to enable content creators to profit from their creativity and to secure the freedom of people to share ideas without risk of censorship.

For that purpose, Steemit has built a robust Blockchain database called Steem, which distributes rewards in cryptocurrency with real value to the users who bring the best content - articles, commentary, images and videos - to the platform.

It brings a new economic model to the table. As described by Ned Scott, company’s founder, the model is a “sort of a fountain of youth, similar to the mining rewards of Bitcoin, rather than a tipping or revenue sharing model.”

Steemit users are rewarded by the Steem Blockchain itself, as it tallies posts by their votes and then rewards the best poster and voters accordingly. As a result, Steemit can be an ad-free, decentralized social media platform where anyone can get rewarded by posting or finding good content.

“Steemit differs entirely from social media giants like Facebook, Reddit and Twitter because it is public and decentralized,” Scott continues. “We see this as the absolute future of social media and mainstream adoption is coming faster than we could have imagined.”

The company before and after the hack
2016 was an eventful year for Steemit; the company recorded a similar growth trajectory to the early days of Facebook and Reddit, attracted over 120,000 users and almost a million monthly unique visitors. The team has gone from seven people composed of three front-end developers, two back-end developers, and two founders to a team of 15.

“We intend to increase that headcount, further, adding additional staff around site design and development, DevOps scaling and site reliability, product leadership, user experience and interface design, mobile application development, community outreach and user understanding marketing, traffic insights, retention and audience growth,” says Scott.

However, there was one daunting event that brought a little bit of confusion to both the company’s team and users. The company endured a hack in July 2016. Luckily, it was not a major one only less than a hundred accounts were compromised and only a small amount of Steem was taken and the company reimbursed every affected user.

“It was actually a blessing in disguise,” assures Scott, “because we built an industry-first account recovery system based on real-world relationships, decentr