Crypto Academy Week 7 Homework Post for [@sapwood]
Hi everyone and welcome to my Homework post Week 7. This is an outstanding lecture giving lot of details, thanks to Professor @sapwood. I have learned all new things. Honestly speaking, I have learned all new things from this lecture.
Task 1.
As we learned from the lecture that there are 20 witnesses and 1 backup witness who carry out tasks like creation, signing transactions and network security. As the study suggest that in next 10 years, earning steem reward will be harder than now.
I would like to discuss here how the reward is distributed on steem blockchain. There are two rewards in Steem blockchain. One is Definite Reward that is 35% of total reward and other is Task-based reward that is 65% of total reward.
When new steem tokens are minted, 10% of these newly minted tokens go to consensus witnesses. 15% goes to Vested Token Holders (SP Holders) and 10% is received by Steem DAO. 35% Definite rewards are distributed in this way. On the other hand, Task-based rewards are distributed among Content Creator and Curators. This distribution is goverened by reward pool, known as Proof of Brain.
Inflation rate in December 2016 was set at 9.5% and it decreases by 0.01% with every 250,000 blocks that are being created on Steem Blockchain. So, the inflation rate is decreasing and it will also affect newly minted Steem tokens. When inflation decreases, there will also be decrease in newly minted steem tokens. The inflation rate decreases at 0.42% per year, and it will continue to decrease until 0.95% is achieved. At 0.95% inflation rate, there will no more decrease in inflation.
In light of the above discussion, it is quite clear that holders of SP at the end will be the winning force. So, user should focus on earning steem power as it is very easy now to earn it, and after ten years, it will not be the same, and earning steem reward will be very much difficult as compared to now. When the inflation rate will be constant, it will result in limited supply of newly minted steem tokens. Now is the best time to earn steem power.
How difficult it would be to earn Steem rewards after 2031.
As we have discussed that decrease in inflation results in decrease in newly minted Steem tokens. So, as the inflation rate is decreasing gradually and will continue to decrease, thus Steem reward per block will also be decreased. As stated in the lecture, Block reward is 2.866 Steem now and it will decrease to 2.276 Steem per block in March 2031. The inflation rate then would be 3.49% in 2031. So, it can be noted that STEEM reward per block has decreased and it will also result in such a way that earning STEEM reward will be very difficult.
From the picture above, it can be seen that estimated STEEM reward per block is 2.866 now and it will increase to 2.962 in March 2024. Then it will decline and in 2031, it will reach 2.276 STEEM reward per block.
The mathematical formula that has been used for projection of STEEM reward per block is given below.
(Virtual Supply * Current Inflation rate)/Blocks per year.
Current Inflation rate is 7.692% as given in the lecture and Blocks per year are 10,512,000. These two things are known to us but Virtual Supply is not given, for that purpose I have to go to Steemworld.org.
By clicking on Market Info, we can locate Virtual Supply. Now I will apply all these figures in Formula.
(389,688,550.7 * 7.692%) / 10,512,000 = 2.851 STEEM per block.
STEEM tokens that would be minted between 2021 – 2031.
As we can see virtual supply in 2031 from the table given above, is 685,011,397.3
Current Virtual Supply that we got from steemworld.org is 389,688,550.
(685,011,397.3 – 389,688,550.7) = 295,322,846.6 STEEM
So estimated amount of STEEM to be minted between 2021 – 2031 = 295,322,846.6
As we have learned from the lecture, 2037 will be the year when inflation and block reward will tend to be saturated with the inflation rate hitting 0.95% and there will no more decrease in it.
Task 2.
In Steem blockchain, private keys are the only way to access the account. In case, these keys are lost, there is no way to recover your account. But on other hand, if account is hacked or any other unforeseen event, one must know the recovery account connected to his account. In case of my recovery account, I have explored my recovery account and the screenshot is given below.
From the screenshot, it can be seen that my recovery account is Steemit inc. And if any unforeseen event like hacking happens, I must contact steemit inc. to initiate recovery procedure. I will have to provide my keys/passwords for this purpose within 30 days of the event.
Task 3.
In blockchain, everything is visible to public. Only private keys are not visible. There is a set of keys that is used for different purposes. For example, Posting key is used for posting purpose on Steem blockchain. Likewise, active key is required for monetary transactions.
There is an option of Encrypted message that is only visible to the sender and the receiver. For this purpose, Memo key/Master password is used to send Encrypted message and the receiver is also required Memo key to read the encrypted message. “#” is used as a prefix with the encrypted message without any gap. One must have to login to his wallet using Memo Key/Master password. I will give examples how to do this with the help of screenshots.
• Login to your wallet at steemitwallet.com using Master password / Memo Key.
• Click on small button in shape of “Inverted Triangle” that is next to the balance of Steem or SBD.
• Then Click on Transfer, as I mentioned in Screenshot.
• In the first field “To”, enter the username of your counterpart, to whom you are transferring steem/SBD. In the next field, enter the amount that should be the lowest amount like 0.001 in case of an encrypted message. On the other hand, while transferring amount with encrypted message, then user can fill the amount that needs to be transferred.
• In the memo, encrypted message should be written with # in the beginning without any gap. It can be seen in the screenshot above. Then click next.
• Next screen will show as in below screenshot to confirm transfer, Click ok if you are satisfied.
Now, to see a decrypted message, login the wallet using Memo key and look at the history. Decrypted message can be seen in this way.
Transaction is visible to all users but the memo will not be visible except sender and receiver.
Conclusion.
From this lecture, we have learned that users should collect SP as much as they can because it is best time to easily receive steem reward. But as the time passes, it would get hard to receive steem reward as compared to now. We also learned that Private keys are very important and these should be saved by the user properly. In case of any event of account stolen or hacked, how account can be recovered. Also we discussed the method to send encrypted message.
Thanks in anticipation.
@steemcurator01
@steemcurator02
@sapwood
@trafalgar