I’ve joined Steemit. Steemit is a social news service which runs a blogging and social networking website on top of a blockchain database, known as Steem. My journey through the cryptocurrency landscape.
Well, I’ve done it again. Off I go on another learning adventure. Very much to Felice’s chagrin. When I do these deep dives it usually involves many late nights and early mornings downstairs in the “Lab”, to the detriment of everything else. I digress.
I’ve been playing on and off with cryptocurrencies for about 4 years now, since the summer of 2013. One thing that has hit me is that you would think I would be one of these cryptocurrency whales by now. That’s the term we use, “in the field”, for someone with a lot of cryptocoin. Big players in other words. Alas, I’m not.
I’ve dabbled in Bitcoin when it was around $110 bucks trying my hand at mining. Bought a few ASIC (Application-specific integrated circuit) USB miners and joined a pool. I think I made about 0.0154895 Bitcoin in the process. In today’s market, $32. I have a few ASIC miners if anyone wants one. They now make cool key chains. Unless you have a lot of hash power mining just is not profitable at this point.
Bitcoin, as you can see, wasn’t so successful for me. I did learn a lot about the code behind the Bitcoin blockchain, it’s double hash algorithms and coding and configuring miners and mining pools. I also jumped around on some altcoins, like LiteCoin and PeerCoin. I had to switch to GPU mining for those Alt Coins but they seemed to be a bit more profitable. I just wasn’t ready to commit to the outlay for some higher end graphics cards with the GPU’s (Graphic Processing Units) that you could offload the processing on to for mining purposes. Guys were buying four or five and setting up mining rigs. Like the image below.
It seemed as with Bitcoin I had stumbled into another hash race and a quest for mining power vs electrical usage and profits. So, I let my poor single GPU run my miner on LiteCoin and PeerCoin for a few weeks. It was really just a learning exercise, I knew I wasn’t going to profit and I didn’t.
After all that mining, I was feeling kind of let down by the cryptocurrency phenom. Aside from the technology aspect, which is really interesting, it was the proposed use case to solve all fiat type transactions. Instead, it looked to me like it was really all about driving the value of Bitcoin or other Altcoins. The innovation was and is there but fringe and not generally accepted yet by the business world. Many would argue but if I ask all of you – “how many of you have done a transaction involving a distributed ledger?” – The answer is probably zero. My case in point. Yes, you may know about Bitcoin, who hasn’t heard a news article on it, but my point is no one, aside from the ones close to the industry, actually use it. At the time it was too consumer confusing, probably still is.
So, I hung it up for a bit.
Along comes Ethereum. Ethereum is a blockchain-based distributed computing platform featuring smart contract (scripting) functionality, which facilitates blockchain contractual agreements. Wham! Ok, now here we go. Not just a coin. Doing contract or custom data in Bitcoin was a bit messy and basically involved injecting metadata into the ledger. Not the most robust, a bit complicated, and not native to the Bitcoin blockchain. Ethereum has it built in and is stored in the Ethereum blockchain.
Nerd alert: It’s all pretty exciting. Really.
So, off to the “lab”, I went and set up a private Ethereum test network to try my hand at Ethereum. It’s pretty cool. Ethereum uses a cryptocurrency token called “ether”, which can be transferred between accounts and used to compensate participants for computations performed. There is also another key element, not in Bitcoin, “Gas”. Gas is an internal transaction pricing mechanism, it is used to mitigate spam and allocate resources on the network. So, if I want a transaction to be processed faster I would increase my “Gas” for the transaction. It really just means I spend a bit more ether to get my transaction through the miners faster.
Let’s ratchet it up a bit. Remeber I said I was not sure about the use case and the lack of user adoption? Well, I found that use case in a platform called Steemit. It’s essentially a blogging platform, but on a blockchain!
I know, cool right?
The blockchain is known as Steem and got off the ground in 2016 (so now is the time to get in). Here’s the cool thing about it. People that have no idea about blockchains are using it and transacting via a distributed ledger without even knowing about it. Here’s how it works:
A user posts a blog entry. That’s it, transaction complete.
But wait there’s more… (uh oh, sounding like an infomercial – stick with me though) Users on Steemit can upvote posts and comments, and the authors who receive the upvote can obtain a monetary reward in a cryptocurrency token named STEEM and tokens called STEEM Dollars. As a user, you can also be rewarded for curating popular content. Curating involves voting on comments and post submissions. Your vote strength and curation rewards are influenced by the amount of STEEM Power you hold. Users manage their reputation and influence on the network through STEEM Power.
As you can see above my intro-post has an upvote on it and is running at about $0.38 SD at the moment. Not going to make me rich, but it’s the cool factor. Although my reputation is already up to 27 from the initial base of 25.
I’ve found a use case and it’s pretty transparent to the user, or at least has an inherently low technical buy-in. I’ve found that the user base is also more amenable and positive than other social media sites. Even with disagreements, or a differing point of view, I have not yet seen the vitriol that you get on Facebook or Twitter.
There you have it… guess where I am… yes, down in the “Lab”… playing with Ethereum and writing my next Steemit post. Wish me luck. Let me know if you have a question around cryptocurrency (it’s really not that scary or nefarious).
As we say on Steemit – STEEM ON!