I get that. The problem with paper money is that it can be printed more and more at will.
If we only used BTC for example, its value wouldn't change because there is a constant number of BTC in the world. No inflation or deflation is possible. OK.
Alright, so the value of cryptocurrencies is basically the same as normal paper money... there is no real value except the one we give it. Guess it's the same with gold too. What would a peasant actually do with gold? Nothing.
What I don't get is how the STEEMIT works. Where do the payouts come from? Because we as bloggers don't mine anything here.
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So, with steemit, there is always "steem" being mined. When somebody up-votes your post, a portion of this mined steem gets directed to your account.
So, here is an analogy...
Imagine a gold mine... There are guys working hard all day, digging for gold. Except, at the end of the day, the gold gets distributed where the community deems is most appropriate.
This is essentially what steemit is. except the gold is "steem" and it is appropriated by the community through "up-votes".
Does that make sense? @sulev
So the miners mine Steem. They get only a small amount through mining. The majority gets directed to the STEEMIT network here and gets distributed according to our votes.
OK, thanks. Think I finally get it now.