STEEM Does Not Have A Whale Problem: But There Is A Problem!!!
In my continuing series of situations that people complain about that are working themselves out, I came across a comment on Telegram where someone posted about taking care of the "Whale problem on STEEM".
I was thinking to myself, what Whale problem?
Yeah, I know people like to complain about the Whales.
They are so uncaring.
They only circle vote themselves.
They are investors and only care about money, not STEEM itself.
Etc...
Ironic, people complain about the investors when they are the reason this place is here. In fact, isn't it interesting that every application that is on here is looking for investment money. People need to realize that for technological advancements to take place, someone needs to invest money to fund the development.
That said, the biggest issue people have is the distribution of SP. For some reason people think that there should be a distribution different from what it is. This is an unrealistic viewpoint in my opinion. New projects place the power in the hands of a few and then it should work outward.
The bottom line is that thinking that the distribution of STEEM awry is inaccurate. In fact, my research leads me to the conclusion that STEEM is progressing nicely in this department.
Let us take a look at a few examples.
Bitcoin's largest wallets have over 60% of all the tokens. This amounts to about 16,500 wallets having the majority of the wealth. It gets even more pronounced when you see under 150K wallets out of the nearly 25M controlling 87% of the wealth.
This is after almost a decade that Bitcoin is around.
BCash has more than 50% of the tokens in 1849 wallets. Going further out, over 90% of all BCash is in the hands of roughly 120K wallets. There are a little over 7M wallets.
This is a little over a year old but the tokens were airdropped on Bitcoin holders, so this is not a great surprise.
Litecoin is even worse. This token has 85% ownership in roughly 36K wallets. Founded in, I believe, 2011, this token is 7 years old.
We must keep in mind that STEEM is a little over two years old. Distribution is something that @dan mentioned over the years in some of his writings. I won't go into the speculation that some have posted since I was not around but the almost year long ICO of EOS was in an attempt to get the tokens spread out more.
How did EOS do?
Following consensus across six independent snapshots verifying the state of EOS ownership, data crunching has revealed only 10 addresses hold 496,735,539 EOS tokens or 49.67% of all one billion EOS tokens.
The top 100 EOS addresses hold 748,176,831 tokens, amounting to 74.82% of all tokens. Otherwise said, the next 90 top addresses hold 250 million tokens, accounting for 25%.
https://www.trustnodes.com/2018/06/03/just-10-addresses-hold-nearly-50-eos-tokens
After the longest ICO ever to take place, 100 accounts own just shy of 75% of all the tokens. Thus, once again, it is shown that new projects have the power start out in the hands of a few.
The difference is that with both STEEM and EOS, I do not expect the present distribution to persist like it in over the next few years. One major advantage that STEEM, and I presume EOS, has is that tokens are awarded daily to people for providing content. The system that is in place allows for new tokens to get into the hands of smaller accounts. Try doing that with Bitcoin.
In my post about this topic the other day, I did a comparison of how things are changing. Over the last 13 months, we see a serious shift in spite of the slow sign up process which has kept the active participation rate down.
Here are the changes by percentage (By SP then by Number of Accounts) over the last 13 months.
Whales -20.58% -14.29%
Orcas +22.21% +25.66%
Dolphins +67.36% +52.65%
Minnows +199.06% +77.62
Red Fish +22800% +174.95%
Inactive +447.50% +321.11%
To see what this looks like visually:
8/1/2017
8/31/2018
8/1/2017
8/31/2018
The long and the short of it is that STEEM is no different than any other platform. The distribution is askew since we are so new. Over time, because of the way the reward system is set up, tokens will end up in other accounts.
However, there is a major problem on STEEM that few want discuss. It is a rather simple one. Roughly 10K accounts are Minnow or higher in terms of the SP they hold. Look at this chart and see if you can see what is so interesting about it.
The major problem on STEEM is the drop in users. At the beginning of the year, there were 40K authors; now about 12K. That is roughly a 70% drop in posting rates. Considering the fact that authors take 75% of the reward pool AND, according to @dragosoura, it is at an all-time high in terms of the SP distributed each week, here we find the crux of the problem.
What would the distribution changes looked like of the other 28K people kept posting the last 6 months or so instead of pulling away? Certainly, there would be more people in the Minnow category which would have bumped that impressive growth even more.
Ever since I started following the charts posted by @arcange, I have espoused that posting is the key. Many took exception with me, stating that what I was talking about was not correct. I presume most of who were disputing me are part of the 28K who left. The answer is simple: Post; Comment; Upvote.
Instead of focusing upon the "Whale Problem", why not focusing upon posting 3-4 times a day (with the apps on here now, that is a piece of cake for a smaller account); leave 10 thought out comments in articles that get your attention, ones that show you read the article. This will get you a following.
The distribution is shifting even in the state we are in right now. Improving the sign up process will take care of a lot more since we should see a ton of people starting to come on and engage via the different apps being created. This will start putting more SP in their wallets which will spread the tokens out to an even greater degree.
And that is how it is suppose to work.
If you found this article informative, please give it an upvote and resteem.
Please visit the blog of @arcange to see more information that he compiles on a daily basis regarding the happenings on the STEEM blockchain.
I believe the largest problem facing Steem is many who were brought here were shown by hucksters that Steemit was a fast way to riches if you had anything of value to share. So it pulled people here using the greed carrot.
The idea of a gift economy is foreign, and many who come and leave simply couldn't understand the idea of putting others welfare higher in their scheme of priorities. The idea of focusing on others rewards as a priority equal or greater to ones own reward is foreign to most. The idea that one should focus on true connections and not suck up for a .03-.4 upvote contradicts the mode of greed society teaches us to embrace.
You see it so much, people posting multiple times per day. Low effort crap that shares nothing of who they are, their passions. Then they whine because no one connects with them. No one upvotes their shit, unless they pay for their votes.
I can't even imagine being able to do this in a gift economy. I have a hard time, even with rented delegation to up my voting to avoid dust votes (don't even want to get started on those giving low comment votes because they feel you should subsidize it with dustsweeper), posting more than 4 times per week. Any more than that and I dip into the 70's or lower in my voting power trying to give all thoughtful comments on my 4 posts a non dust vote. And, it would be foolish of me to think everyone should just come to my posts, but me not go to theirs if we connect and upvote their posts.
This in my opinion is how a gift economy works. You build your community, you have this remarkable feature where you can help those in the community build wealth. By focusing on others you grow to respect and care about, to want the best for them the rest takes care of itself. That's the beauty of this idea Dan built. It's a shame many can't see it. They see what most of crypto is for many, schemes to buy low and sell high. That has its place in the world, but that isn't what Dan built, despite its ability to be used in that way.
Anyone who thinks there is a problem here should look in the mirror and ask themselves the tough questions about why they are here, what they expect from this experience and if they are willing to GIVE what it is they seek.
We agree 100%
We are one of the original Whales left since @dan left the platform back in 2017 and sadly we have only seen the Greed and Abuse through the use of Bots and Paid Votes, Circle Voting etc on the Platform increase with each passing day.
Its really sad because we believe STEEM could easily grow to be a Top 25 Cryptocurrency even a Top 10 if it will only create a better system to Distribute and Incentivize individuals to Post Quality content and Whales to Upvote Content based on the Quality and not just their relationship or partnership that is really only benefiting a few people in the know. Many great people left the Steem Platforms for reasons outlined in this article.
If the Community and Witnesses don't start listening to the rest of the people they are going to witness more people leaving and trying to build there own platforms like WhaleShares for example.
We think building a better reputation and ranking system would be a good start. FYI we have tried to bring very Big Whales to Steemit and that has proven to be very difficult with the current atmosphere. We are going to start contacting Whales again, however, we are going to suggest that they BUY STEEM and HODL It well we work in the background to build tools and services to make STEEM more valuable and usable in the Public and Private Realms.
We believe the True Strength of STEEM is in the Community not in the Corporate Structure called STEEM Inc.
We invite you to join The ADSactly Community in our Discord Server we really need your help to build a better System that benefits us ALL not only the Rich and Famous Whales, Orcas, Dolphins etc.
http://discord.me/adsactly
The main problem is people migrating their current economic value structures into a brand new economic theory, and it’s not going to work.
My biggest issue with Steem, not that it’s going to deter me from continuing to use it until one day I become a responsible whale, is that I pour in hours of work into my posts only to be widely ignored in favor of low quality spam, whale posts, and leeches. Which I think is the biggest issue.
As of now, a user can have many others steal their work and view it without ever having to upvote it.
Is it possible to implement a paywall where someone sees a preview before accessing the full content, which will only be available after casting an upvote?
Unfortunately number of active users are decreasing. I think it is relevant to Steem price.
it is.
Sorry , but how do you account for alt accounts owned by whales , for example berniesanders split his main whale account into 7-8 dolphins.
I take your point that STEEM is not different than other coins in terms of distribution and it is important to have investors which will hold the currency thus making it valueable in open market.
Splitting up SP among different accounts provides no platform advantage.
100K upvoting a post or 3 accounts with 33K upvoting a post is the same.
The white paper even spells this out....there is nothing gained by splitting things up other than hiding one's identity.
I think I am saying the same thing with the added point that when whale accounts are split up it gives an appearance of decline of number of whales.
The anonymity is going to make it close to impossible to determine the extent of the dilution of power on the platform. The rewards pool which is approximately 50,000 Steem daily helps in spreading the wealth. The bid-bots and curation claim some of that back to the whales, I would guess maybe around 10K to 20k Steem.
This was an awfully interesting article, and you most have done some hard work gathering the facts and actually writing it. You deserve the biggest upvote I give to someone today, for sure! :)
I'm finally in the minnow category! Wooooooo ...lol.
I'm looking at this chart and wondering who are the six whales who cashed out? XD
Congratulations @phoenixwren!
/FF
Thanks!
Congratulations. That's a good question for @abh12345 - who are the 6 whales who cashed out!?
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Without an accounts history table it's pretty impossible to look into this. Orcas and Whales have spent a lot of time in the past year diversifying stake into alts for bots/security/shady reasons. This is why I'm not fully with this opinion that stake is being redistributed across the community.
UA will help, but only if there are selfless larger delegators - millions of SP worth :)
Actually fair point. The anonimity is possibly the root of a lot of problems on here.
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Congrats man, I just started posting even though I've had the account for about 6 months. I'm thinking about making steemit my homepage so it forces me to browse instead of just using reddit (which I do admittedly like better). I'm hoping once I get my feed set with quality topics and people it won't be so scattered like now. Just my 2 cents from a new user.
There’s not many posts that delve behind the scenes like this. Love it
I noticed those complains too, but after some time, I realized... that the problem is not with whales, but with our very poor and inefficient distribution algorithm which simply do not scale. 12 days ago I wrote a separate article about that... and about a possible solution for this problem:
Lets hope SMTs change the way people view steemit. I don't see a huge spike any time soon but a small gain in users is good as long as we continue growing organically.
Quite the opposite when I checked the steem price a few hours a go!
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Yes the authors take 75% of the reward pool, but the way you wrote it down, it looks that this 75% is equally spread among the 12K active authors. We all know that this isn't the case.
But we all must know that if there only 12K active authors it will get easier to be seen or noticed. Some feeds are drying up and if you do appear in some of them, you will probably get a higher upvote. People do have the trend to keep on upvoting until a certain amount of VP has been reached!
At least that is what I am doing. I am increasing my VP% for some posts and authors, just because there are less and less post popping up on my feed!
Cheers,
Peter
I've also noticed my feed drying up.
Is it really just 12K active authors? I'm sure it'more than that on @penguinpablo's stats?
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I do follow the stat from @penguinpablo and from @arcange. Both do show different figures. But I do believe that it will not be much more than 12K. Those 12K different authors is per day, it is probably better to look at it from a weekly perspective!
Also don't forget that a lot of posts are software generated!
Ok thanks for clarifying re the per day thing. Fair point about the botz too.
Bit gutted about this radical drop to the steem price against BTC in the last day. I was sure we'd seen the bottom!
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This reminds me of the story of reactive and proactive people :) It is happening here on Steemit as well. People being people.