Smart Media Tokens (SMT) Explained: The short version.
What are Smart Media Tokens used for?
Smart Media Tokens allow regular businesses to have the same capacity as Steemit to reward users monetarily for participation on the platform (such as writing good content, voting well, commenting often, participating in campaigns, rating products, bringing new users to the site, etc.). This incentive increases interest and grows the user base, which in turn grows the value of the company. So this incentive allows the company to make more money off its users/customers and to reward their users/customers at the same time.
What does this mean?
This means that social media platforms like YouTube, Facebook, Reddit, Medium, Twitter and other companies with a large customer base like Apple or Amazon New York Times could reward their customers with cryptocurrency just like Steem. But they wouldn’t reward them with Steem, they would reward them using a new Steem blockchain based Smart Media Token, which they would name and which they would customize for their special needs. These external entities will sign up through Steemit to operate their own cryptocurrency on the Steem blockchain. These companies will receive Smart Media Tokens or coins, which are like Steem, but they won’t be Steem, they will be a Smart Media Token with another name chosen by these companies.
Where are these coins used?
This coin will be used only on their platform, only on their website or only at their stores. Steem and Steem Blockchain Dollars (SBD) are Steem coins used inside the Steemit platform. SMT are Steem coins used outside the Steemit platform. All of these are coins based on the Steem blockchain, but they are used different places.
Why would these companies want to do this?
This allows these companies to take advantage of the cryptocurrency blockchain system without the expense of building their own blockchain. This means that social media platforms like YouTube, Facebook, Reddit, Medium, Twitter and other companies with a large customer base like Apple or Amazon New York Times could reward their customers with cryptocurrency just like Steem.
How does this arrangement help Steemit and holders of Steem coins?
The adoption of cryptocurrency and the blockchain by these large organizations will expose a large portion of the world to cryptocurrency and the advantaged of the blockchain. This type of publicity increases the number of people who understand and take advantage of the blockchain concept. This can only be good for cryptocurrency. Plus it’s good for Steemit in particular because it should also increase the value of Steem. Remember that although these smart media tokens are coins with a different name then Steem or Steem Blockchain Dollars (SBD) , they are still part of the Steem blockchain and in the Steemit family of coins.
References
Announcement by Ned Scott Steemit CEO: https://steemit.com/steem/@ned/announcing-smart-media-tokens-smts
Article by Ned Scott, Steemit CEO: https://smt.steem.io/
Steemit White paper on SMT: https://smt.steem.io/smt-whitepaper.pdf
Article by @littlescribe: https://steemit.com/cryptocurrency/@littlescribe/smart-media-tokens-smt-explained
Extremely good content man! Enjoyed reading it. Thanks and keep up the good work!
Thank you for reading my article and leaving a positive comment.
Congratulations on your reward. I read your blog. You are extremely productive and publish in multiple languages.
@originalworks
How can I use these SMT. Suppose I got some SMTs named August which are associated with Facebook. How do I use them. And why will Facebook or Google adopt these. Will they not prefer building one of their own. They are giants who build everything for themselves. Just curious.
Hi,
This are very good questions.
First question, if Facebook has Steemit design SMT for Facebook, these SMT called August tokens would be used to reward you for value you bring to Facebook such as your pictures or your friends and relatives, which you bring to Facebook. Although people don't think of themselves, their families and their friends as customers, to Facebook you are customers and you may be the person who invites your family and your friends to Facebook. So you are bringing Facebook customers and Facebook uses your information to make money. So you get Facebook for free, but Facebook makes a lot of money off of what you bring to them. The purpose of these coins is to first reward you for what you have done in bringing Facebook customers and also to reward you for any content you put on Facebook that also brings them customers or helps them generate revenue. Plus now that you have been rewarded you want to bring more friends, more family and place more content on Facebook. So now you become more productive for Facebook. You would now use these coins as a form of currency on Facebook to purchase goods or services on Facebook stores or potentially outside Facebook if a merchant decided that accepting these tokens was a good way to drive business to his establishment. Additionally these coins would have intrinsic value in dollars, which the free market would set and this value would potentially grow and fluctuate as all stores of value do. Your second question is also very good because Facebook and Google are very big concerns, so they could go out and hire experts in cryptocurrency and blockchain development and build their own. Cryptocurrency and the creation, function and maintenance of a blockchain are relatively new computer software creations and although most cryptocurrency starts as a clone of something which came before it like Bitcoin, Bitcoin Gold, Bitcoin Green, etherium etherium classic and so on and so on, they are difficult to create and maintain, plus flaws and weakness which can be exploited are constantly being discovered. So while these large companies certainly have the resources to build their own blockchain, they would do so at considerable expense and then their famous blockchains would go through the growing pains and embarrassments of any new blockchain. Plus their newly hired staff would now have to maintain this blockchain and protect it from hacks and exploits. This is not only costly but potentially these problems could damage their reputation and drive away customers. It is in some ways easier and wiser to build your cryptocurrency on a pre-existing blockchain, which is tested and has seasoned experienced people to protect and maintain it. This allows them to first focus on their core business, second not divert resources to accomplish what can be more cheaply outsourced and third: in the business world a third party contractor owns the problems and bad press, so it provides good protection for the business leaders who are in charge of this project at these big companies. Lastly a similar and very successful model would be smart contracts on the etherium blockchain, which are very popular for similar reasons.
Good explanation to my questions. I see a point in the SMT but definitely not for Facebook. It can not see Facebook join hands with its biggest competitor. And for instance if we agree that Facebook adopts the SMT then just imagine how badly they will invade our privacy.
Very informative article. I really have no knowledge of crypto and articles like this are much needed.
Thank you for reading my post and thank you for your positive comments. You may want to read these other articles:
https://steemit.com/investments/@shortsegments/the-newest-passive-investment-strategy-for-smart-investors-cryptocurrency-masternodes
https://steemit.com/cryptocurrency/@shortsegments/the-evolution-of-cryptocurrency-passive-investment-vehicles-for-people-who-fear-their-governments-distrust-banks-or-need-hedges
https://steemit.com/bitcoin/@shortsegments/ned-the-ceo-of-steemit-travels-to-korea
Take care
Congratulations on your reward. I read your blog. You are extremely productive and publish in multiple languages.
Thank you very much for stopping by and for your nice comments.
Your welcome. You are creating good content, so you should have good feedback and a large following.
Great post. I think I'm starting to understand why blockchains are going to be very important in the future.
Thank you, The Steemit opportunity allows those who help others prosper to also prosper. "One lifts up the other."
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Congratulations on your reward. I read your blog. You are extremely productive and publish in multiple languages.
Thank you very much for stopping by and for your nice comments.
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Sure you have my permission to translate this article.
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Thank you @juninho for reading my post and for your thoughtful reply.