Adapting to Market Signals - Steem Sports
Sometimes you build something for one purpose and the market takes it and uses it in a way that you never expected. When this happens we are left with a choice of fighting the market or embracing the unexpected. For the past month or more the Steem Sports posts have been garnering a large portion of the reward pool. This is neither good, nor bad, but simply a reflection of what the majority of the voters want to do.
Disclaimer
That said the current interface on steemit.com is not well suited to the application. A much better interface would allow people to simply "click" to cast their vote and would have a simple interface for funding a bet. Their wallet would allow them to view the current status of all bets they have cast.
Meanwhile the Steemit.com bloging infrastructure would filter these kinds of posts into their own dedicated section to make the main page more appealing to those looking for content to read.
Should we Support Steem Sports
As a community we should either embrace this market segment or actively choose to downplay the these posts. If we were to embrace it, then STEEM would morph into more of an entertainment platform that could attract sports fans from around the world. While this could be a huge opportunity it does come with some risks.
Placing bets on sports is much riskier from a regulatory perspective; however, doing so with a virtual currency almost makes it a pure game that keeps score with virtual points. Under the current Steem Sports set up the posters are taking the risks. If we were to customize our interface to support this use case then we would end up taking slightly more risk.
Custom Blockchain Support
The current implementation of Steem Sports has a lot of rough edges:
- most of the payout is held in VESTS of poster
- participants must trust the poster and his algorithm
- the interface isn't well suited
- posts are not well indexed / sorted / displayed for users
- posts use unreasonable portion of reward fund
- posts spam those not interested in sports
I would propose that the blockchain add native support for the Steem Sports use case and make the entire process as trustless as possible. This would involve adding a new custom post type with custom rules for dividing results.
- Anyone can create a new sporting event, just like anyone can post
- Anyone can vote for an outcome and upvote the event at the same time
- Voting for an outcome is economically equivalent to betting with an amount equal to
post_reward * vote_rshares / total_vote_rshares - Anyone can fund their vote with additional money
- After the event is over, the losers can concede voluntarily and receive a small reward for conceding.
- Those who do not concede voluntarily get no consolation reward when a decisions is ultimately rendered
- In the event of a dispute, witnesses can vote on the winner.
The idea with these rules is that a rational loser will concede and receive his consolation reward rather than risk his consolation reward in the hope that he can manipulate the voters. The winners would never concede because they would give up their real reward. A dispute would be easy to identify by looking at the ratio of concessions from both sides. As long as the community actively polices abuse attempts few will attempt abuse.
Benefits to On Chain Solution
Under this approach the system would be self governing and distributed. The rewards could be paid in full immediately after payout. The market would automatically identify the events that are most interesting and the blockchain would subsidize the rewards.
A new kind of Market - Negative Rake, 0 cost Sports Betting
Where else on the internet can you bet on sports and win money without having to put a dime of your own money on the line? Where else can you have a guaranteed edge in a series of 50/50 bets?
Auger may be doing it all wrong. We don't need full fledged prediction markets with all the complexity involved. We just need a simple, fun, no-cost betting system.
Does this fit within the Scope of Steem?
If Steem is a blockchain designed to distribute currency as rewards for user participation and encourage growth of a social network, then I think we could easily argue that Steem Sports fits. Sporting events drives discussion and betting puts people's skin in the game. The effect of the bets would be to generate useful market odds for observers. Demand to increase individual bets would drive SBD purchases and STEEM token value.
Further Work
There are many additional variables that could be considered. A portion of the rewards should go to the person who started the bet. It might even be sufficient to allow this individual to be the de facto judge rather than the witnesses. Only the most trustworthy individuals would get upvoted and those who cannot be trusted to judge the outcome the right way would earn negative reputation and no longer be able to earn rewards by starting new events.
In general I think the simplest possible solution can enable a wide range of fun games and might just tap a huge market that is currently unaccessible to Steem.
What are your thoughts?
DISCLAIMER: this post does not originate from angry or bitter feelings, as I believe Ricardo and the steemsports team have been doing a great job and I have a very good personal relationship with him (after some initial misunderstandings.) :-)
To the best of my knowledge, I have been the first person to offer an upvote-based bet on Steemit. I wrote this post over three months ago https://steemit.com/steemit/@claudiop63/steembets-bet-for-free-by-upvoting-and-win-steem-dollars-inauguration-bet-clinton-vs-trump
You will notice that its URL and content seem unrelated to each other...the reason is that originally the post's content was about a bet on the Clinton vs Trump race. The post got flagged by @smooth for "vote buying". I then felt that this was a strong warning from the community that vote-based bets were not in the spirit of Steemit, so I changed the content of the post (since I did not want to waste the promotion money I had invested) and forgot about my project on vote-based betting.
A few weeks later, Ricardo started steemsports, and to my surprise, he had gotten the explicit backing of several whales. His project then developed nicely. At some point, I created the steembets account, but never managed to unlock its potential, so I sold it a few days ago.
Why am I recalling all this? In order to claim ownership of the vote-based betting idea? Not at all... :-)
I am talking about this because this is a background to my proposal below, which aims at fostering the emergence of new ideas on Steemit in a "smooth" way (unintentional joke) :-)
Since the SP distribution in the community is still very uneven, and a few people hold strong "moral suasion" power, it might be useful to promote a "new projects" tags in order to allow innovative and potentially controversial projects, such as vote-based betting, to be put forward and collect community feedback. This would enable creative people to get some credit and visibility for their ideas, while reaching some sort of preliminary consensus on whether or not the key people in the community would support the project, mitigating the risk that projects which are similar to each other generate different flagging patterns....
Once again, I congratulate Ricardo for his success, and I look forward to disclosing on Steemit an innovative project of mine in the next few weeks, and seek community feedback...
Although I am not a fan about Steem Sports, it surely brings attention and engagement and consequently provides some value to Steem. However, IMHO, Steem Sports should solve two major problems.
As @dantheman pointed out too much VESTS are going to @steemsports as fees. It earned 217 MVESTS (while it vested under 100 STEEM) since its beginning. In percentage, probably around 37.5% will go VESTS. Additionally, around 10% is kept as writer's payment and development fund. So in total betters spend about 50% as a fee. (if we consider curation reward, around 35% as a fee)
Odd ratio is too low. Some users complained that it is not exciting as much as expected, since the payout was very low, usually under $1. I think simple binary betting is not a good way for sports betting. Instead, combination of multiple binary betting, or score-based betting can be used.
Hell Yes!
You can say this for any popular topic.
The Community votes on the post, how is voting on what is popular suddenly unreasonable ... simply because the vote did not give the result some expected?
Oh wait, I'm in America. Never mind. ;)
Also keep in mind that you once said the payouts that people catfishing the Community received weren't a problem because they were putting effort into the post. ;)
+5%
Agree 100%. This could be yuuuge for STEEM!
Among all the comments on this post, this one is my favourite. Loved the comic style :D
You are right about it being yuuuuge!! haha
Best response!
Thanks for saving me from having to type out half this much and adding more insight than I would have.
Steem Sport is taking a large portion of the rewards pool right now because they have very little competition as a STEEM distribution blog. As other STEEM distribution blogs like @thegame @bola @steemit-health come along and incentivizes users to participate in their blog for a portion of the rewards, we will see users migrate from "sports betting" to STEEM distribution activities in their field of interest.
Blogs are now realizing that they can share their rewards with users, incentivizing them to participate in any type of activity. This is why I started @steemit-health. Once we have 10 activities a day that distribute STEEM to the health community, people who are interested in health stuff (more than sports betting) will migrate from Steem Sports to Steemit-Health.
And this is good for Steem Sports as well. Once there's competition between STEEM distribution blogs in many different fields, Steem Sports will be left with true sports fans, which will make it a lot easier for them to package and sell their users' attention to companies that want to advertise to sports fans.
I've been running a pretty healthy alternative to the SteemSports games. I have a smaller audience, but the payouts are much larger for the winners and my cut is mostly limited to the SP award. It's not a "distribution" game, per se, but it does distribute and I have a loyal group of players/sports enthusiasts. Competition is good, so I'll be looking at new ways to expand what I'm doing and will take some of @dantheman's ideas into consideration if I do decide to branch out.
Nice, I was thinking if anyone has been doing SP distribution on something more participatory than left/right betting. But in any case, I like Steemsports for its simplicity (not sure about value though since i'm not into sports). Will check out @steemit-health. Actually would be interesting to see this model for external curation!
Let me know what you think! @steemit-health is experimenting with two different distribution models right now, one activity where all participants receive an equal share of STEEM and one activity where all participants are entered into a lottery. - It's a very soft launch right now but I think it has potential.
@steeit-health is different as it's all distributed equally to everyone participating. No winners or losers ... just all winners, so to say.
Yes the distribution style is different, but it's still distribution. Right now, I'd guess that the vast majority of users participating in Steem Sports are not very interested in sports betting at all, but they are very interested in acquiring more STEEM in exchange for their attention.
Each field of interest, whether it be health, sports, fashion, music, technology, etc. will develop blogs that have their own distribution model that suits their audience.
My point is, that once there are second level (blog level) STEEM distribution options in many different fields of interest... new users will come to Steemit and find additional rewards in the fields they what, rather than all piling onto Steem Sport.
ps. I think Steem Sports is great;)
The betting on sports thing is a dangerous game to be playing. The people that enforce that stuff do not play around. I know of what I speak ...
No doubt. Steem Sports has to be very careful. My main point is in reaction to:
I don't believe we have to do either. I think this only appears to be an issue right now because of the lack of competition between STEEM distribution blogs in different fields of interest.
I stopped betting and upvoting steem sports about 10 days ago when I figured it was not worth the effort, and only 1 out of 20 of the games I bet on was something I knew about, as the only sport I watch is UFC.
There is no competition because suddenly steem isn't real money. It's steem power, so nobody's bothered to compete. All those skeptics we wanted to convert are being let walk away because they haven't a chance to compete and they haven't had the chance to realise the value of SP.
It's interesting to me that this is posted now, and a few hours ago I decided to mute steem sports and all other "upvote to bet" games like it, been seeing too much of it. After muting them, the trending page and hot page that I frequently visit was a better experience, and that experience inspired me to also mute posts about stats like ozchart, except for the stats report by @elyaque, his report is great, and usually the first post I look at every morning. I had not thought of using the mute as a means of filterring until today
I upvote every steemsports post and place my bet. And I'm kind of disgusted at myself for that because I only do it for fear of missing out. I don't like the direction it has been taking steemit in the last month or two.
When I first joined steemit VOTE-BUYING was highly frowned upon. Yes, they redistribute the liquid rewards. But the reason this activity was originally downvoted was because the community didn't want to push the platform into a direction that would make us look like a niche that doesn't attract the masses. If steemit becomes a "gambling" website we are doomed to that particular market alone. If the blockchain accommodates those kind of posts but doesn't reward them with SP, then maybe that could work. But as it is, I see the community digging itself into a hole that months ago we said we wouldn't dig. Just because sports is more attractive than lottery or other types of vote-buying posts, this particular genre was encouraged and even those who don't like the idea (such as me) will support it in order to prevent myself from falling behind...
Steemsports and vote buying doesn't encourage any participation or quality. And in order to make steem(It) appear legitimate to the masses we need to be encouraging quality, not quantity. Steemit currently refuses to take one direction and make a name for itself.
It's not a social network it's a blogging platform
For that matter, it's not a gambling site or a porn site.
Currently the landing page says "Welcome to the Blockchain". Why not reach out to the most viable demographic and call it a Blogchain?
Welcome to the Blogchain
Why not? Because we want to reach everyone not just a demographic? Totally unrealistic. Nothing ever gets adopted that way. Facebook started with university students. Perhaps there could be a gambling platform on the blockchain, or better yet a different blockchain! Or perhaps there could be steemporn. But if you think those things can be on steemit mixed in with the smoothie blogs and travel blogs and everything else, then we aren't ever going to get anywhere because we aren't taking any direction.
I like your BLOGCHAIN idea @beanz.
I tend to agree. I don't particularly like sports betting. What your post suggests is that people are band wagon and its popularity is misleading.
I should clarify I've worked in a bookies and do enjoy sports and betting (though I'd never work in one again because of the amount of addiction I witnessed). My issue is mainly with the lack of direction. I fear that if steemit takes a direction that is inconceivable to most people (free Money for free bets) then that will forever be how it will be associated and we will lose our opportunity to present a platform or financial insurance system that people can believe in.
People don't buy what you do they buy why you do it.
I too remember this TED talk, and for me personally the why or purpose is extremely important, especially as I invest my time. Although Apple has marketed on the basis of "resisting the status quo" in the past, I don't see it much now as opposed to the "our products are better" message. Also, I see Apple as part of the status quo now, taking control of users' data away from them and pushing them into the cloud.
I remember this Ted Talk. It's excellent!
First of all, steemports is not just gambling. Every single post is also blogging, with a writer who writes about the the game, the players, etc.
Second, I'm pretty sure that sports and gambling are bigger markets than personal blogging. I don't think being inclusive of different types of content is a bad thing nor impossible (especially with better tools for organizing and filtering), but if hypothetically we did have to choose, I'd probably choose the bigger market over the smaller one. As an investor/stakeholder, why shouldn't I?
Spot on. The gamblers will make the bloggers more valuable actually.
The key here is that this is an ecosystem that is worth more together as a network than on its own.
It's better to be game investment tool, blogging site and social network all together than each part on its own.
You invested in Steem token not Steemit token. Each company has multiple teams (which sometimes are working on the same engine), but another idea should not always be incorporated in the most well known product of a company. Youtube is still a Youtube, not a Google Video.
Of course, one product of a company can/should promote another products in a common ecosystem, but this not mean, that those two products has to be merged for ever.
As a investor you should remember about diversity. If Steemit.com will fail, I would prefer to have still SteemSports.com thriving, but if SteemSports will fail, I do not want to see Steemit taken down together with it.
They're all using the same blockchain and therefore drawing from the same pool of content. If Steemsports switches its primary interface to steemsports.com, the posts will still appear on Steemit.com. Steemit.com is a view of the blockchain, it is not a separate platform with its own content.
Steemit decided to hide content which is flagged by many people. This is just a policy. Another policy can be: hide everything with content-type: games, because there is separate interface dedicated for that
Of course, but why would you do that on a leaderboard of the highest payout posts (which is what the badly-named "Trending" represents)? Steemit.com can offer a different home page with whatever sort of filtering rules, and indeed I think the biggest problem with this platform is people can't filter and display what they want. You can't even look at one person's blog without seeing resteemed posts, nor can you look at posts with one main tag without seeing posts using the same tag as a secondary. The entire organization is terrible. But this has very little to do with Steemsports, which are not only games but also (sport-oriented) blog posts BTW, so it isn't even clear to me how that would be categorized if it were possible. Some other game posts are more clear though.
are you sure, that people actually read that stuff? IMO those posts are just a justification to take another 30% from SteemDollars/Steem (according to their rules).
Actually it isn't gambling at all. I lose nothing at all if I lose the bet. I might even still get a curation reward. It's nothing but vote buying. As for the analysis of the game - that could be rewarded for the writing without the vote buying included.
Sure you could choose the bigger market of sports fans. But this type of content encourages no participation whatsoever. It's nothing but a free bet. So you can invest in a platform that gives away free money for zero participation but in the end, that's a much harder sell than "blog for rewards". Why would bigger investors see a platform dedicated to giving away free money for zero work as a legitimate investment.
If that's what steem is going to be forever associated with, because it's the biggest most highly rewarded thing on the blockchain, then I doubt we'll ever be taken seriously.
Speak for yourself. I take steemsports seriously as generally well-written sports content that engages sports fans with a fun game (as you say, not really gambling) that offers daily prizes. A way to earn and distribute cryptocurrency (the latter being the original purpose for the site after all) that doesn't require being in the narrow group of successful content creators. To me that is all very serious, and potentially very successful.
I didn't say people wouldn't take steemsports seriously. I'm talking about a blockchain that gives away free bets for nothing.
I believe that the original purpose of the site was not just to distribute cryptocurrency, it was to be a financial insurance system - stakeholders paying to financially support projects or people who need or deserve the rewards. For people to take steem(it) seriously, in my personal opinion, there needs to be a purpose - not just profit and distribution - that doesn't make sense to people and as suggested in my reply to dantheman, it's a result, not a purpose. Free money for free bets will just never sell because it makes no sense. Earn money for blogging and creating and adding value (to the platform or otherwise) that makes sense and excites people. Free money for free bets might entice people to check out the website skeptically, but as soon as they see that it's a "steem" dollar it would be laughed at as it just can't be real. As for the current content creators, I would say that it's disincentivising competition.
As a stakeholder in the platform, I do not believe I derive any value from all this content that you claim adds value. It is an illusion, but there is no actual economic or monetary value that derives from it which would support the notion of investors' money being given to bloggers. None.
The only mechanism that supports this being viable is to distribute crytpocurrency widely and have that grow into a self sustaining economy.
Free bets are a game. If people enjoy and participate in the game, it adds value for the participants. It adds value to the economy by distributing tokens widely, seeding a market which can then be tapped by entrepreneurs offering goods and services. (There are other games on steemit that I also like -- I noticed one where you have to guess the combination of a safe.)
It makes just exactly as much, or as little, sense as paying people free money out of thin air for posting their blog, although in reality I think it makes more sense because the market is bigger and the barriers to participation by users is lower.
FWIW, the issue you raise with people not believing in 'free money' already exists. It especially exists when they try to post and earn nothing because they aren't particularly famous, or talented, confirming their view that the whole thing is a scam. Now contrast that with what happens when they pick a side on a steemsports game, and win. They actually earn a payout, into their account, which can be cashed out (and methods for doing this more easily will only improve over time).
I agree 100%. This could take steemit to a new level. On another note porn would absolutely take steemit to new levels exponentially!!! I have written a post about it. FULL STEEM AHEAD!!!
We already tried pr0n, it didn't work out so well with a majority of the community.
But when? The community is changing more and more every day.
You're exactly right. @claudiop63 made a comment about another vote-to-bet game that I had flagged for vote buying (some time ago). The experience of steemsports tells us that this is an evolving platform. Many of us are strongly in favor of experimentation and being open to new directions. I don't particularly care if this turns out to be a blogging platform, a social network, a betting site, a porn site, or some or all of the above. Whatever works to drive enthusiasm and attract, retain and grow a user base is fine with me..The technology itself can continue to evolve and usage of it can also certainly continue to evolve. There is no need to and no particular benefit from getting stuck in one particular model before any significant success has been achieved with it. (This includes Steemsports, maybe that model will turn out to be a dead end as well. I don't know, and I doubt anyone else does either.)
Give it another shot, best of luck! :)
I don't bet, nor use Steem Sports but I did see an increase in frequency of these posts and I wasn't aware it took such a large part of the rewards pool.
My suggestion for @dantheman is to have a "root" type of operation at the blockchain level, that can be subclassed in the client.
"content" and "activity-on-content" could be the root classes and they could be subclassed in a custom implementation.
Steemit.com could implement "content" => "article" (or photo, video, etc), "activity-on-content" => "vote". And SteemitSports.com could implement "content" => "event", "activity-on-content" => "bet".
There really are only those two main operations at the blockchain level and putting specific cases at the blockchain level would clog it eventually.
Also, having the custom implementation in a client could also help with regulatory problems (I'm not a lawyer, though). A gambling website is regulated independently of the WWW protocol.
Also, I have a few use cases on the gaming niche as well that could greatly benefit from such an implementation.
If we imagine Steem long term future, we have to be aware that this kind of initiave can fill a niche but can't be too big in the early days. We can have tens of niches like that in the future but if we give too much importance to sport betting in early days, we will transform the wide potential of Stem and orientate the plateform to this market. That could arm the future of Steem by removing the potential seriousness of it and lead people to think that it's a plateform for betting, photo challenges and cooking receipes ;p
Exactly! In time the blockchain could accommodate this, but it's way too soon. We need people to see steem as money befor they can conceive of a free bet. This is never going to attract the crypto skeptics that we need to attract.