Losing Steem: One of the Most Active Crypto Projects Cuts Staff

Steemit, the social media platform built around the STEEM digital asset, is reorganizing its structure and downsizing 70% of its workers.

Steemit, a social media platform built on top of a distributed ledger, has encountered trouble exacerbated by the drop in market prices. In a Steemit community announcement, Ned Scott, the CEO and co-founder, outlined its challenges and plans.

“Given the weakness of the cryptocurrency market, the fiat returns on our automated selling of STEEM diminishing, and the growing costs of running full Steem nodes, we have been forced to layoff close to 70% of the team,” wrote Scott.

The Steemit platform has existed since July 2016, and became a prominent hub for crypto-related information. The platform, one of the projects by Dan Larimer, was the successor of BitShares, and served as a prototype of the mechanism for EOS. In its prime, Steemit with its triple-token structure and distributed proof-of-stake blockchain, was ahead of its time.

However, the network was criticized for allowing bots and organized voting to game the rewards system. In the summer of 2018, users also noticed the founders’ wallets being emptied of STEEM, suggesting a liquidation of funds.

The STEEM market price suffered heavy losses in the past month, dragged down from around $0.83 down to $0.35. In the past month, Steem Dollars (SBD) also sank, from around $0.97 to $0.80. The initial idea for SBD was to be pegged to the dollar, but for a while, the Steemit platform abandoned the task of keeping the dollar peg by printing or burning tokens.

In the past years, STEEM was at one point seen as a “Bitcoin killer”. However, skeptics are extending the trouble of the Steemit platform to EOS, another Dan Larimer project:

https://twitter.com/WhalePanda/status/1067730784058957825

While the skepticism may not be entirely founded, Larimer has failed projects such as BitShares under his belt. The BitShares network is still functioning, although in the past, it has been accused of exploiting the system of Delegated Proof-of-Stake to benefit large holders. The Steemit ecosystem has seen similar accusations, including the pre-mine, and the early moves by the founders to reap gains and later sell off the asset. The Steemit platform has also been criticized for giving too much influence to whales.

Neither the author nor the publication assumes any responsibility or liability for any investments, profits, or losses made as a result of this information. Cryptocurrency trading and investing are risky propositions, and market participants are advised to always conduct thorough research.

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