I discovered steemit recently and frankly, the premise seems to be revolutionary and game changing. However, I have not been able to wrap my head around its economics and legitimacy. However, if legit, it might change the face of social media as we know it.

Many detractors[1] allege that steemit is simply a scheme designed to benefit the founders and has no long term potential. For example:

1. There are allegations that the STEEM proof of work mining was gamed (or at least not done transparently) before the system transitioned into (mostly) proof of stake. This led the founders to control a majority of the STEEM supply, leading to centralization[2].

2. In addition, said founders have been alleged to be dumping their STEEM methodically ever since, thus inviting the comparison to a Ponzi or Pyramid scheme[3].

3. Many people still don't understand the economic mechanics of STEEM. In particular, people are asking that if both content creators and consumers are being paid, then who is paying for it?

I would love to know what the HN community thinks of this new blockchain based social media site.

[0] (White paper) https://steem.io/SteemWhitePaper.pdf

[1] (White paper annotated by a detractor) http://www.libertylifetrail.com/2016/10/23/steemit_started_as_a_scam_and_only_got_worse/

[2] https://bitcointalk.org/index.php?topic=1427230.0

[3] https://bitcointalk.org/index.php?topic=1558366.0