HOMEWORK TASK 7
INSTITUTION: STEEMIT CRYPTO ACADEMY
COURSE: Steem Blockchain (Inflation, Recovery Account, Encrypted Message)
CRYPTO PROFESSOR: SAPWOOD
Learning about blockchains is one very important aspect of cryptocurrency knowledge. It's also very important for a steemit user who is interested in learning about the platform to know about the steem blockchain. This homework task covers some vital aspects of the steem blockchain, including
- Steem inflation rate
- Steem recovery account
- Encrypted message and use of memo key.
This homework task will follow a Q&A approach in attempting the tasks set for it, for easy understanding. It will also include some overviews where necessary.
STEEM INFLATION RATE
Steem is a social blockchain that employs the DPoS (Delegated Proof of Stake) consensus mechanism as its governance protocol. With this protocol, it rewards a definite number of actors whose activities are similar to those of miners on PoW (Proof of Work). Steem has a reward pool from which it rewards these actors who are called witnesses.
The blockchain also has other actors who also contribute to the progress of the blockchain and are also rewarded. They include
- Content Creators
- Steem DAO
- Vested Token Holders
Together with the witnesses, steem rewards these actors with tokens gotten from the inflation of the virtual supply of the STEEM token. Steem employs an inflationary model to create a fixed number of tokens as each block is completed, according to the inflation rate.
Following the calculations done in this coursework by the professor, assuming the current STEEM/SBD ratio continues, the table below, given by the professor, hints at the quantity of virtual supply and new steem tokens over the next 16yrs.
Supply estimation assuming constant STEEM/SBD ratio - by prof. Sapwood
As most of the STEEM tokens will be minted in the next 10 years or so(on account of inflation), how important it is for you to build your SP in the next 10 years and build significant influence power in the form of SP?
From the table above, notice that between Mar 2031 and Mar 2021, a total of 293,206,427.3 STEEM ( ie. 685,011,397.3 - 391,804,970.0) will be created.
Here is a brief rundown of how the inflation in STEEM is allocated -
- Witnesses - 10%
- Steem DAO - 10%
- Vested Token Holders (SP Holders) - 15%
- Content Creators & Curators - 65%
So, over the next 10yrs, assuming the STEEM/SBD ratio remains constant, SP holders will be accruing 15% of 293,206,427.3 STEEM, which is about 43,980,964.095 STEEM. This will be distributed in proportion to the amount of SP each holder has.
Thus, we see that it is important for any actor on the steem blockchain to build their SP to a significant amount, so as to get a bigger/significant portion of the 43,980,964.095 STEEM that will be distributed to SP holders in proportion, over the next 10yrs.
Also, of the 293,206,427.3 STEEM which will be created over the next 10yrs (of course assuming constant STEEM/SBD ratio), 65% will go to content creators and curators. Having a significant SP and employing it in curation work will earn any actor a good portion of this 65%.
How difficult will it be to earn STEEM rewards after 2031?
Still from the table above, between Mar 2030 and Mar 2031, we see an increase of over 25 million STEEM, between Mar 2029 and Mar 2030, the increase was more, likewise between Mar 2028 and Mar 2029.
However, between Mar 2031 and Mar 2032, we see a lesser increase of about 22.8 million STEEM and the increase lessens as the years go by. So, after 2031, it becomes more difficult to earn STEEM.
For instance, between Mar 2036 and Mar 2037, there's only an increase of about 9 million STEEM. This increase will be shared among all the actors on the steem blockchain. The witnesses, for example, get 10%, which is approx. 900,000 STEEM.
Compare this to between Mar 2026 and Mar 2027 when there'll be an increase of over 30 million STEEM. Then, the witnesses, for the same activity gets 10%, which is about 3 million STEEM.
We can thus see that between 2026 and 2027, the witnesses earn about 330% of what they will earn between 2036 and 2037. Considering that the trend of reducing increases continues after 2031, it is, therefore, apparent that earn STEEM beyond 2031 will be more difficult than earning STEEM before.
From 2021 to 2031 how many STEEM tokens are going to be minted(approx)?
Between Mar 2031 and Mar 2021, the total number of STEEM tokens that will be created will be approximately -
685,011,397.3 - 391,804,970.0
= 293,206,427.3 STEEM
In which year the inflation and Block reward is likely to saturate(tentatively)?
The inflation rate is programmed to saturate at 0.95%. At this point also, the block reward will remain the same as the inflation rate becomes constant.
From the table above, given by the professor in the course content, the inflation rate deflates to 0.95% in Apr 2037, at this time also, the block reward is 0.708.
So, the inflation rate, as well as the block reward, saturates at 0.95% and 0.708 respectively, in the year 2037.
STEEM RECOVERY ACCOUNT
Who is your recovery account in Steem, how do you check it(Hint- Steemscan), include screenshot(s)?
My steem account was created via signing up on the steemit platform. Below are the following steps for checking my recovery account.
Using my pc, I open the following link - steemscan.com
Next, I click on the search bar and enter my account name.
When this is done, I hit enter and my account details come up.
In the profile section, the recovery account is stated there, and it is steemit Inc.
In the case of any unforeseen event like hacking what information do you provide to the recovery account(or the trusted account) to initiate the recovery process?
If my account is hacked, I'll need to provide my previous keys/password to my recovery account for them to initiate the recovery process. I must do this within 30 days from the day of the incident, else, my account will be unrecoverable.
ENCRYPTED MESSAGE AND USE OF MEMO KEY
How do you send an encrypted message(private message) to another peer in Steem Blockchain(include screenshot/process)?
Sending an encrypted message via memo is a possibility with minimal difficulty. Below, I'll show how I sent an encrypted message to another steemit user @jollybake.
First, I go to my steemit wallet by clicking on my profile picture at the top right corner of my pc screen and selecting wallet from the dropdown.
I would like to send the memo with STEEM rather than SBD, so I go beside my STEEM balance and click the dropdown. From the options, I select transfer.
The transfer dialogue box then pops up and I input the details. Notice that I start the memo with a '#'
To encrypt a memo on steemit, begin it with '#'.
After inputting the details, I click on next and a confirmation dialogue box pops up
I click on 'OK' and then another dialogue box pops up. In this one, I have to input my master key to send this encrypted message.
I click on sign in and that does it, the transaction is sent.
After a while, the transaction reflects in my wallet's transaction history. Since it's my account, I can see the encrypted message.
However, when I sign out or open a private widow on my browser since I'm no longer logged into my account, I can't see the message. It's blank.
Which key is required to send a private message and which key is required to decrypt it? (Example/Screenshot)?
To send a private message on steemit, you'll need a master key. To decrypt it, you'll need your memo key.
Either send an encrypted memo-tag to exchange and send a private message to another user?
Having sent a private message to another steemit user in a previous example, I'll now send an encrypted memo tag to an exchange.
Again, I go to my wallet and select transfer from my STEEM balance dropdown. I input my details and encrypt my memo by beginning it with '#'.
I click on next and another dialogue box pops up. Then I confirm the transaction by clicking on 'OK'
After confirming the transaction, I have to input my master key to finalize this encrypted memo transaction.
Once I sign in, the transaction is completed.
As usual, from my account, the encrypted message can be seen
Other than my account, the description is blank.
The steem blockchain is a social blockchain that employs an inflationary model to create new tokens which are used to incentivize the various actors in the ecosystem. Holders of SP are very fortunate as they get to have 15% of the increase in the token.
On steem blockchain, stolen passwords can be recovered as long as it is within 30 days. This is because there is a recovery agent for each steem account. This agent requires previous keys and passwords for them to recover the account. They are called recovery account.
Lastly, sending an encrypted message on steemit is a simple action that only demands beginning the memo with a '#' and using your master key to sign in. Decrypting an encrypted message requires a memo key.
Thanks for reading.