• The bear market has taken a heavy toll on Steemit, causing them to restructure
• They had to lay off 70% of their staff due to unsustainable revenue model
• Their token, STEEM, is being used as a payment method, but has also lost about 96% of its value

Steemit, a blockchain startup, has laid off 70% of its staff due to the ongoing bear market in the cryptocurrency industry. The startup has different crypto products, one of which is a social media website that’s closely linked to the STEEM blockchain as well as cryptocurrency. They have also allowed their users to send content and get payment for their work. However, their coin ‘STEEM’ which is being used as a payment method, has also lost about 96% of its value this year.

Ned Scott, CEO and co-founder of Steemit, has published an update about this news. He explained that the layoff was the direct outcome of the cryptocurrency bear market. While the blockchain will continue to operate, the company will need to undergo an overall restructuring and reevaluation. In this press release, Scott wrote:

“We still believe that Steem can be by far the best, and lowest cost, blockchain protocol for applications and that the improvements that will result from this new direction will make it far better for application sustainability. However, to ensure that we can continue to improve Steem, we need to first get costs under control to remain economically sustainable.”

How Steemit Started

Steemit was launched in 2016 by Dan Larimer and Ned Scott. But since its launch in the Bitcointalk’s forum was not very transparent, and the blockchain was instamined by the developers since users were not ready for the project’s mining technicalities. When the Steemit platform was introduced, Co-Founder Dan Larimer had to leave the project in order to pursue another idea. This idea became EOS eventually.

The STEEM coin is utilized to get revenue for the users and the developers who are Steemit users. The company behind it had no ICO, forcing them to use the funds from the initial mining process. They also had to stake the funds to continue with their operation. However, the central authority, Steemit Inc., depends on an inflationary (DPoS) model to ensure that the blockchain continues to operate. Without the services on top of the blockchain, it will have no use.

1 STEEM is currently priced at $0.37, which is 95% down from the peak price of $8. The number of authors is also dropping because the incentives they receive are now much lower.