Let’s start from the beginning.
Hive.com is a Social Media Platform built on top Hive's Blockchain, which rewards it's users a Digital Currency called Hive. A digital cryptocurrency that is not only tradeable but also has real financial Value.
Hive is a Cryptocurrency just like Bitcoin/Ethereum when it comes to having it's very own Blockchain or Distributed Ledger, making this Virtual token Transferrable, Fungible & a Freely moveable Asset. The Hive blockchain a permission less blockchain ledger where no one has direct control over the Network meaning that tokens are Governed by Code and not some Individual, Corporation, Government or Bank. You have a Decentralized Network which is hosted by Steem Witnesses & supported by it's Users around the World, whose goal is to strengthen the security of its Digital Currency.
Hive is tradeable on the popular exchanges Bittrex. Hive tokens are part of a permissionless ledger made accessible to the general public, making it a free tradeable Currency with little to no restriction where the end-user or parties decide on the final price and choose the preferred platform to facilitate this trade
The Hive is a fork of the Steem blockchain and is built using the relatively new Graphene Blockchain software construct, which is also used by projects like Bitshares & PeerPlays. All three use this cutting edge technology to power their infrastructure, while Bitcoin tends to be Slow when comes to being a Medium of Exchange and charges it's users transaction fees, Hive on the other hand is Free of charge and Executes Blockchain transaction almost Instantly. Hive has no Transaction Fees & almost Instant transactions.
Hive and Hive Power
One Cryptocurrency & Two Smart contracts
In this excosystem there are three forms of this cryptocurrencies Hive, Hive Power, Hive Backed Dollars plus a smart contract which defines their relationship.
Hive Power
Hive Power is Hive locked up in a Smart Contract where it is not tradeable or saleable.
Emphasing on the word Power, Hive Power is symbolizing how much influence you have inside the Hive platform. Influence here is the same as value or amount of Hive you award with your upvote or approval vote on content posted here. If you have a lot of HP your upvotes will count more.
More explainantion
Hive Power will result in that HIVE being transferred in what is also known as the VESTED HIVE or HIVE POWER and represents HIVE that is locked up in a Smart Contract which grants you certain a stake in HIVE, a Social Network build to distribute HIVE from it's Reward Pool.
If a User wants to convert back from Hive Power to the base currency of Hive, it will be converted within 13 weekly conversions. Then Weekly Payments begin to convert Hive Power to Hive.
Hive Backed Dollar
The Second Smart Contract is called Hive Backed Dollars or abbreviated HBD. This is a debt instrument that promises to distribute $1 worth of Hive to the token holder in the Future. HIVE Dollar is essentially HIVE in the form of a pegged Currency. HBD pays interest and HBD should be convertible to $1.00 worth of HIVE, however it will take 3.5 Days to complete a Conversion.
Note that the Hive Dollar is a Smart Contract which is freely tradeable, hence why 1 Hive Dollar may not actually be worth $1 Dollar because of Free Market Demand & Supply, whenever HDB is traded on popular exchanges the price is directly influenced by Buyers & Sellers who set prices between each other.
At any time, the value of the Hive Dollar is roughly equivalent to the value of the Dollar, the World's most popular fiat currency used as Benchmark & Standard, this Smart Contract is backed by HIve's own built-in Market Exchange. This stability is remarkable in the Crypto Sphere where prices are never the same the next day, with unstable price fluctuation.
In fact, it eliminates some instability associated to Cryptocurrencies, which most agree is the largest barrier for adoption of Bitcoin or or other Altcoins.
So there it is, the Hive ecosystem: Hive the decentralized application hosted on the Hive blockchain Chain, Hive the cryptocurrency like Bitcoin, HivePower the voluntary locked up form of Hive which earns interest and allows you to give and receive rewards on the application Hive. And you have Hive backed dollars, a stable coin guaranteed to be worth $1.00 worth of Hive and the Smart Contract which defines the interaction between all three.
It’s that complicated and it’s that straight forward.
✍🏼written by Shortsegments.
Written by Shortsegments. ✍🏼
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