Suggestion for Masternode-like Incentive System for Investors
This is a quick note presenting my suggestion for the better incentive structure of Steem. A core idea is introducing masternode-like staking incentives that provide both liquidity and profitability to investors.
Current Incentive System
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Highlights
- All SP holders obtain 15% of the total reward
- SP holders those who curate additionally earn 18.75% (25% of 75%, vary by vote patterns). Therefore, they obtain 33.75% in total
Problems
- Significant proportion of reward for SP investors is given to Steemit (currently about 25%)
- Investors are forced to curate, or they will have much less financial benefits. This brings about poor-quality curation, or even voting bots that merely spend voting power to any contents.
- Investors who hold STEEM for liquidity also have disadvantages.
- Consequently, two extreme results. Investors (who don't want to actively participate to Steem community) easily become lazy curators and distort our contents discovery system. Or passive investors give up to invest in STEEM due to much disadvantages.
Suggested Incentive System
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Highlights
- No SP rewards
- Curation rewards is about 20% of total rewards (33% of total contents rewards, 70%)
- Saving is re-branded as like Staking
- Minimum staking unit exists, similar to masternodes. If the number is 5000, staking 4999 STEEM does not provide any portion of rewards. In the same vein, staking 9999 STEEM provides same rewards as staking 5000 STEEM
- Some moderate delays (e.g. 3 days) to un-staking, same as saving balance
Benefits
- Investors have more rewards than now without doing meaningless vote
- There will be more demands for STEEM to fill the minimum unit of staking
- Investors also have greater liquidity
- Dedicated curators will have more influence and contents discovery system will works better
- Overall, this modification is expected to raise STEEM price, then make staking more attractive, then again increase STEEM price; virtuous circle
한글 요약본
현행 시스템은 스팀파워를 갖고 있으면 총보상의 15%, 거기에 큐레이션을 하면 18.75%를 더 받을 수 있는 시스템입니다. 이는 보팅봇 같이 무의미한 큐레이션을 조장하며, 결과적으로 큐레이션도 망치고, 잠재적인 투자자들도 몰아내는 폐단을 가지고 있습니다.
제 제시안은 마스터노드와 비슷한 개념으로 최소 스테이킹 단위를 토대로 하는 리워드를 신설하고, 거기에 대한 유동성도 충분히 확보해주는 것입니다. 이를 통해 단순투자를 목적으로 하는 사람들은 스테이킹을 하도록 하고, 헌신적인 큐레이터는 컨텐츠 필터링을 하도록 함으로서 스팀 매수수요 창출과 컨텐츠 필터링을 모두 개선할 수 있습니다.
We need to incentivize passive investment so that investors feel welcome and not everyone feels forced to participate in the content aspects. I would support some version of this proposal.
They already can do this. Buy steem or steem dollars and hold it. then sell when price rises. I don't believe taking money from people who actively contribute and rewarding those people with a lot of money is a good solution. I'd rather see 1 millions users creating content than 10million people holding steem to earn passively off the backs of the poor working class who post.
We already have that.
I think as other users have pointed out the numbers need some tweaking. We're finding that large investors avoid steem because of the time investment, staking at these returns won't change that. However I think that if the minimum stake required is lower than on other platforms we might see attraction from small-time investors. It would still draw steem liquidity out of the markets, and a low required vesting amount might make this more attractive to users in countries where steemit is gaining traction.
Staking shouldn't have such a smaller time window to cash out than powering down does, and it's debatable whether or not powering down should take as long as it does considering how volatile the markets are.
Steem is very centralized, I think gearing our coin towards small to medium investors by having attractive options for staking small amounts as well as increasing the value of active curation slightly will only increase its adoption amongst a broader pool of users. I think a play of facing the coin more towards developing markets might pay dividends if we continue to see acceleration of economic growth from the nations where steemit is growing explosively in popularity. Instead of making it attractive to existing wealthy investors from wealthy nations we could make it something that people from countries where incomes are steadily rising and middle classes are forming could ease into steem and benefit from in its growth the future, and the gains would be reciprocal.
I think the crypto markets are already flooded with coins operating on the concept of "the rich get richer", we need to differentiate ourselves if we want an edge.
^This absolutely
I believe Steem is indeed becoming centralized (specifically in how rewards are distributed) and bid bots tend to lend to the problem which puts the low stakeholder working hard to create exceptional content at a great disadvantage.
Hopefully, the whales wake up and smell the coffee but am glad there are some actively considering solutions to the problem. Your comment was very thoughtful. Following you now. :)
Awesome
hey mate,
pardon if this is a bit off topic…
I made a post today regarding a large-scale idea to advance Steem’s development, aiming to get this in front of the audience who’d be in the position to do something with/about it, and it was recommended to share with the witnesses (hence, this share):
The $1 Billion Steem Development Fund: How Steemit Inc.'s Stake Could Be Best Allocated To Grow A Thriving Network Of Applications And Users...
would be great if you could have a read, and IF you feel it’d be a great idea that’d serve the community, forward to anyone in particular you know who might be in a position of influence to advance the discussion.
cheers,
Rok
Keep in mind Steem Power is what secures a DPOS blockchain. It should be largely held and widely distributed to ensure plenty of decentralization in witness voting. If SP is not valued enough, someone could swoop in, buy a bunch, power up and significantly change the witness list, possibly in detrimental ways.
@lukestokes , this was my feedback below. Please let me know if I understood correct?.
By the way, did you have the chance to check Chapter 9, and review your mention on it?
Chapter 9 of 11: The Art of Giving Value - Learning from Experts of Specific Topics on Steemit
https://steemit.com/steemit/@gold84/chapter-9-of-11-the-art-of-giving-value-learning-from-experts-of-specific-topics-on-steemit-this-is-part-9-of-11-chapters-full
Regards, @gold84
this definitely is too advantageous, many whales do opt in, investing alot than getting sp, authors might get lesser vote as they see this more gainful.
See, this in my mind deserves 100%. You know what, seeing that thing with @traf, and now this. I'm voting you up for witness. You clearly know your stuff.
well said @lukestokes, i didn't see this when I first replied to @clayop, but i could not have summarize it better.
I also think "forced curation" is one of the biggest problem of Steemit right now, and this looks like a very practical solution that doesn't require a big change of current system as well.
I guess this can also discourage abusive self-voting problems because they'll have 30% less interest by doing that. Currently, abusive self-voters can get up to 90% of interest, but if it becomes 60% max, they would rather do staking because it's going to be similar to 30% of staking profit anyway if they consider the risk of community down-votings and the value of their time wasting.
Overall, I totally agree with this idea!
@ned ?
firstly nobody is being force to curate, thousands and thousand of Steemian powerup and don't curate optimally they curate 0-99% of their daily 20% replenish upvote, that is their right to wait to see who is worthy and how they choose to do as they please
2ndly the benefit self voting will go away in hf20, but that doesn't even matter, people just self-vote with another account
3rdly abusive selfvoting will not go away with staking (I explain above to your reply to me)
4th at 60% max author self-vote, the benefit still out ways 3.1% of staking, go see the %-percentage calculation that I gave to @clayop
5th @ned @sneak have probably covered staking in great depth when Steem was first design, probably so did @dan, redcoin uses staking......if you like staking, go buy redcoin, it will compete with Steem, and I mean this will all respect due. Our purchase is a reflection of our political belief in crypto.
Lets see where both will be in 5 years time. I will use my money to buy Steem and patiently wait and curate and support Steem and other Steemians with my upvotes and my flags.
Note: redcoin has gone up 800% it might be great to hold and stake it for some time, who knows, but since we both have about the same amount of Steem, I think our interest is probably align, and I hope to engage with you further so our discussion benefit more Steemians and hopefully Steem too.
Specific node for investors sounds good to me :)
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Quite a fresh idea. Three things shoud be adressed out.
Majority of whales or dolphins would be likely to choose staking as it is more profitable and super easy so that the authors will get less votes, less rewards as a result.
3 days are too short. considering the 13 weeks for the powering down, staking is too much advantageous over SP.
The investers who choose the staking cannot take the advantege of influencing the steem community through the witness voting. Smaller encouragement of the long term staking. Is it intended?
Also I reckon balancing the profits between those two will be seriously difficult. So my alternative idea is introducing an official staking account. People who choose to stake can simply delegate their power to the account. The account generates profit, and pays back the stake as SP. As your idea is also based on SBD pegged to USD, this solution could work with much smaller side effects.
I agree with this point as I stated in my comment above. Only for more valuable and right discussion, I would like to address a missing point.
The whole reward amount is constant regardless of consumed voting power. Instead of absolute value in voting power, relative voting power would be used to determine the rewards of individual postings. I guess each voter would have more power and impact on postings if people prefer staking than curation.
Thanks. You are absolutely right. Thr reward pool wouldnt be stolen by abusing so that each author and curator will eventually get more! I missed that part.
I agree with the major intention of proposed incentive system. There are too many meaningless voting bots, which actually prevent picking up the great posting in the steem community. However, adoption of masternode seems to bring some disadvantages and worries as well.
Much thank you for your effort to improve steem community. I would like to point out that I like your idea. But "I think" there should be modification of percentages for masternodes' interests.
Since the percentage for each reward is fixed, there will be a balance. That is, at some point, rewards for staking is lower than rewards for curation. And another variable to be considered is marginal costs and benefits of users. Some users more weigh psychological satisfaction over financial profits, and hence less care about smaller curation rewards. Some others do not want to spend time and effort for curation, and may be more willing to remain in staking even the reward is smaller.
The points from 2 are based on the point 1, which I rebut above.
These are some nice points that you pointed out, I do believe our reward system is actually being abused, "the rich get richer and the poor aren't even noticed." I believe, 10% reward from every post/comment/etc should be collected separately and should be distributed between every user(whale, dolphin, minnow, red fish) equally. So, the money doesn't just stay between the poor, the reason this is needed because of other factors that are being abused(upvote bots), due to upvote bots , people tend to autovote whales who already earn a lot because of which it is only those few authors who keep on getting into trending and other equally deserving authors don't get the attention they deserve and are demotivated.
It is remarkable to analyze your reward to sp holder, and I am also honored to be delivered by @donkeypong,
I am a newcomer in steemit but I understand what is in your post @ clayop, I am amazed at you, thank you for sharing ...