Regarding SPS why take away 10% of the reward pool in order to pay for things that are being built anyway? This building is being done organically and the builders are actually creating business models with outside income sources. This will take away incentive! In my worst English "if it ain't broke don't fix it!"
Let's look now at the reward curve and why I hate the proposal. As a disclaimer I must first write that I have purchased about 25,000 SP at between $1 and $3!
Why I Don't Like It:
1.) If Steemit.com wants another reward model for bloggers they can use SMT's to do it. Don't mess with your unpaid builders!
The Steem blockchain is NOT a blogging blockchain so they shouldn't base everything on that! That is NOT visionary!
2.) Those of us that have built using the current reward system are going to get penalized. I reward all commenters on my posts with an upvote of at least 3% if I can't do that my community has less incentive. What about big investors that are trying to build a communtiy and reward them. Will they still invest? Probably not.
Steem's economic model is broken. That's a fact. Otherwise, we wouldn't be losing relative market-valuation constantly. Inflation is being generated and sold on exchanges, but the buy pressure is not big enough to sustain a high market valuation.
And regarding taking from the reward-pool: the majority of it isn't being utilized effectively. The inflation should have been something that is advancing this ecosystem, but only a niche group of people are actually doing something. SPS will hopefully help to have more streamlined goals for people to be rewarded for actual work done.
this a bear market, the low of 40 cents is alot higher than the lows of 2016. For steem to work it needs investors and believers. Authors are the ones who dump steem because they are effectively working and need paying. I believe the Hardfork encourages more of an investment mindset which is crucial for the steem price and ecosystem long term. It is not broken it is a bear market and we ride it out with every other alt coin.
That's not entirely correct. We're at 4400 satoshis right now, which is far lower than when Steem was at its lowest in terms of USD valuation. Which essentially means: Steem lost a lot of value in comparison to BTC and other alt-coins which did much better (EOS for example).
I've written quite a lot of posts over the last 2 years and the only reason I'd power-down those author rewards, would be for tax purposes, but not because it's such hard work. On contrast, creating content on Steem should be fun and I'd argue that the majority creators on Steem aren't professionals in the traditional sense.
Now, while authors are of course part of the dumping problem, I agree with @whatsup that most of it was done by early stakeholders (incl. Steemit Inc.) But that's part of the game. What we need are more incentives for people to hold their Steem and buy more of it. And this is not happening with authors alone. Everyone can read/watch their content without spending a dime.
in all respect your twisting what im saying. Im not talking about satoshi im talking about dollars. The only people who are going to buy steem and hold it and take it off exchanges are curators. They now how more incentive to do so.
You said that the valuation of Steem is higher than at the all-time low. But that’s only because BTC is at 9400$+. Looking at the USD can give the image of Steem price being good, but it’s far cheaper than it has ever been.
That's correct. As long as people actually want to hold Steempower. Which is why 50/50 is so important.
i dont care, its still higher in what matters, money.
Obviously STEEM was not ranked 69th(!) at CoinMarketCap some months ago, so of course you are right, and the problem is not only a general bear market!
But I really wonder why many 'stake holders' care so much about their ROI? What does it help to get a bigger part of a cake which is getting smaller and smaller? I prefer to have a smaller part of a huge cake. :)
If I knew it would let the STEEM price increase significantly, I would accept not to earn one single STEEM from now on. :)
Why do people buy BTC? Because they want to earn as much as possible interest or because they believe the value of BTC should rise?
In my eyes a real curator loves what he is reading and will curate anyway, he doesn't care if curation rewards are 50 or 25 % (and won't just join automated trails without reading what is he upvoting).
When I upvote stuff I upvote it because I like it. I don't care when I upvote (if for example after exactly 15 minutes), and how many other users have already uptoved that post.
I intentionally seek posts from new and/or unknown authors to give them a dollar or two.
With 50 % curation rewards I can't give them the same amount in future, because then I myself will get a big part of my own upvote back (as curation) instead of being able to support the authors! Sounds ironic anyhow: then I want but cannot anymore support people ...
I don't need to earn a lot of STEEM anymore because if the price will rise, I am rich anyway, if not it also doesn't matter to have even more STEEM (then I will enjoy my BTC). :)
Less than ~10% of rewards are received by creators. @arcange publishes daily statistics that reveal the exact numbers, and my last check showed the median payout was .01 SBD (median = what most people receive), yet the average payout was ~15 times that. That is because the vast majority of rewards are paid out to 35 whales, not the rest of us. Their few posts and comments receive ~90% of payouts from the rewards pool, about a third of that from bidbots. The below chart is almost two years old, and despite repeated requests for a current updated chart, I have been unable to get one. The authors have changed, but the curve is practically unchanged.
It is not creators that impact the price of Steem, because they hardly get any of it. It is profiteers, manipulating rewards by their substantial stake weight, that extract almost all the value of the economic activity on Steem, and prevent capital gains from ever impacting the price of Steem - because that value is instead diverted to their wallets as tokens, rather than raising the price of tokens.
Check @arcange's latest post for the most recent relevant statistics.
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He said relative market valuation and he's absolutely right. In the crypto market, which as a whole has indeed been in a bear market, Steem has dropped from top 10 to top 20 to now barely holding on in the top 70 (!). Some of that is due to promising new projects which took their spots in the high ranks, but mostly it is due to being much lower than projects which Steem used to considerably out-rank.
Blaming Steem's relative performance on the bear market is way off base. This is mostly on us.
dude, every single altcoin is in the gutter. Every single one except BNB and litecoin. He is not right, he is twisting my words to suit his own argument. I said steem is higher now and holding on to 40 cents which is way above the 0.03 cents of the lows in 2016. Thats all the matters nothing else, when Bitcoin tops 20k Steem will scream back up to 3 and 4 dollars. People dont understand crypto, fundamentals have got nothing to do with it. Its all relative, when one coin makes a run for it and hits a crazy price everyone says well if that xyzzy coin can be that much then every other worthless coin can be worth more too. That all feeds into itself and the casino and hype becomes alive again. I laugh when people talk about marketing and this and that, its a joke. Nobody uses this stuff yet its not happening like we thought it would its all speculation, all of it, fuelled by hot money coming out of nowhere. Slagging off steem and people saying its doomed does not help though i agree but it makes no real difference, because when it all kicks off again steem will be the best thing since sliced bread until the bear market attacks again.
Yeah and at least 50 of them have STILL managed to outperform Steem.
Stop making excuses.
Most of the Authors can not hurt the price. The dumping comes from above.
Much of the stake is not being allocated to create value at all. It is a difference in opinion on what brings value.
The eyes of the community cannot support all of the dumping, but it is mathmatically impossible for the dumping to come from most authors. The witnesses also sell to pay expenses.
Although I am not a fan of how they are approaching this, I do hope it teaches people why it is important to fight abuse. We can't change SteemIt Inc's selling, but do we have to support self voting, bot abuse etc? If people learn to downvote maybe not.
By the way I agree the funding of the SPS should have come out equally, it does need to be funded.
Agree and disagree. Yes "most authors" purely counting numbers can't hurt the price because their earnings are tiny. But the reward pool in the aggregate is responsible for a large portion of the selling pressure, in that it totals about 17 million STEEM per year, far more than what even Steemit is selling (about 9.6 million per year).
Not 100% of the reward pool is sold immediately but a very significant piece is, and of that which isn't sold immediately, a lot of that ends up being sold somewhat later anyway.
17 million STEEM/y is important, it is a big challenge to find enough investors to float that selling, and we need to be very careful to make sure it is used effectively.
You are under the assumption that the stakeholders and witnesses are better at directing it at places that add value. Based on the distribution and the last 3 years, I disagree.
It is not the tiny users that have run down the price and run end users off. They just don't have the power or the stake.
You and I both remember the original distribution. Any changes in that are a result of large stakeholder selling and small accounts buying or holding.
My view is that the mechanism which has been used for that for the last 3 years has been severely flawed and these new mechanisms are much better, especially the SPS mechanism which apparently (I say because I have no personal experience but I believe those who claim it) has a track record of working well on Bitshares.
IMO with the exception of Steemit nearly all large stakeholders selling from the original distribution has long since occurred. What is left of the original distribution, people have mostly decided to keep long term (there may always be exceptions and people may always change their minds, but it isn't a constant flow of selling). And remember, in the original distribution Steemit had 80% and everyone else shared 20%.
But numerically the inflation paid out to content rewards matters a lot. It is more than the rate at which Steemit is selling, most probably higher than the net rate at which all whales, Steemit included, are selling
To be clear, this does not mean content rewards going to minnows. Most of it goes out at the top. But we also can't micromanage where it goes. Maybe with better mechanisms we can have some chance of managing it at effectively all.
Inflation being sold is irrelevant compared to steemit inc selling rate, isn't it?
Mostly yes. But instead of working to create revenue to solve the problem we seem to be trying to plug a leaky damn by putting our finger in the holes.
Imagine if steemit.com structured things in order to bring in tons of new users which in turn would boost their ad revenue, instead of making it even harder to on board new users, which will ultimately reduce their ad income and likely spell their demise.
Hell no. Author rewards (not all of inflation but the biggest single piece) are currently about 17 million STEEM per year and Steemit sells 9.6 million. Not all of author rewards are sold (nor other components of inflation) but you can be damn sure that a lot of it is. It is very, very wrong to dismiss inflation and rewards as a source of selling pressure.
Okay thanks for putting things into perspective. I had no idea how much STEEM steemit inc were selling.
I guess we still have a few years to get STEEM on the cheap while inflation is high, and then the price won't go down as much.
That is certainly one way to look at it. And in addition to Steemit eventually slowing and/or stopping their selling, the baseline inflation declines by 1/2% per year. So yes, over time, the amount of available new Steem will decline a lot.
You are why Steem's economy is broken, and are the best example of that malfunction. You extract it's value for your personal profit before the economic activity and infrastructure can produce capital gains.
Less than ~10% of the rewards are reaching the intended destination of rewards: content creators. Almost all rewards are being extracted by manipulative financial mechanisms, and end up in the wallets of whales. You are the niche group 'doing something', and the something you are doing is preventing capital gains. The whales are cutting their own throats by concentrating all the value of the economy into their wallets, each to the maximum degree possible. EIP is a set of mechanisms to increase the rate of extraction of value before it creates capital gains. Halving author's share of rewards and instead delivering twice as much to those extracting it with the weight of their stakes, increasing the exponential power of stake with the modified rewards curve, and availing free flags to flaggots censoring creators that returns rewards the community sought to provide them as incentive to the rewards pool, where you can extract it instead, all increase the rate of extraction of rewards by stake weighting, and suppress capital gains.
You and your ilk are doing so because you can simply move on to the next victim once you've drained the host economy of the stake you extract. Steem will be a corpse, drained dry by your parasitization, left to blow away in the winds of avarice, leaving the gems that could have instead have been nurtured by substantial stakeholders to create capital gains for all investors; censorship resistance (in a world more silenced every day); one of the best blockchains ever written; a currency model that made transaction fees obsolete and proved microtransactions not only viable, but scalable both globally and fiscally, and a social media use case that could have leapfrogged every business model extant - had you only been willing to rely on capital gains for your ROI.
Should Steem somehow remain viable after you profiteers have moved on, perhaps the remaining users will be able to implement sound policies that encourage investing for capital gains, and then be able to grow instead of feed parasites.
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Exactly. When did we even have a debate or when was a case even made where agreement has been reached on the need for SPS? What is SPS supposed to do for the ecosystem to make it worth 10% indefinite spending rate?
How do we stop or reverse course if we find SPS is not somehow profitable or growing the ecosystem? If Steem were a company or a government how would we justify this to shareholders or to voters?
@blocktrades is certainly the subject matter expert on this, and I believe he's published a number of posts explaining the careful design of the system. The discussion was had amongst the Witnesses who are the ultimate arbiters of these decisions. Those are the people stakeholders voted for.
What the SPS is supposed to do is fund projects that create sufficient value to justify the expenditure, and that's the analysis people should perform when determining whether to vote on a proposal. If there are no good proposals, then people shouldn't vote on any proposals, and that money will go unspent. That's how you roll back the SPS, if it doesn't generate any value, don't use it or downvote proposals you don't like.
Is 'none of the above' an option?
Yes, there are two ways to vote "none of the above" in SPS. One is a return worker which returns the funding back to the SPS treasury to be used later and another is a burn worker which sends the SPS funds to @null.
Well, at least it has that going for it,...
Not liking the level of the toll gate, either.
How do we get to it?
It get its own tab?
I know that a basic web UI to view proposals and vote for them was completed along with the blockchain code but I do not know where that will be placed on steemit.com
The question is how will we track and measure how much value a funded project is provided? The question of "is it worth the amount of funding it is receiving?" is a question the community is likely to ask. If a project somehow drives some sort of revenue so that the value/price of Steem starts to go up then of course we can all agree this is good.
But I am concerned we could end up with a lot of low value "projects" which developers and insiders like but which does not measurably drive according to any traced metrics. So if we are talking about increasing active users, or increasing investor interest in holding powering up, or something measurable like this then great.
Are there any current ideas that @blocktrades has in mind to be on the initial proposal list?
There are blockchain history elements generated for all payouts, just as there are for content payouts today. UIs like the many we have for existing Steem functions will process this history show the data. We know who are the largest earners on author payouts, curation, who is powering up and powering down, etc. because of the many UIs and reports that have been created by the community to show this kind of data.
The initial version includes a pretty limited web UI that shows proposals and allows for voting on them but I have no doubt that over time many additional UIs will be created to show the data in more and different ways (some may even have their funding provided by SPS, some may not)
What I meant to express but did not word very well is will the UI allow for us to track the metrics of projects so we can determine the success or failure based on how much a certain project is contributing to success measures?
If it's retention stats, or if it's the Steem price, or if it is something else, I think every project which is asking for funding should have a business plan with a profit motive. The project can be a great idea but then how does it increase the price of Steem or bring in more users or make current users more active?
Example, a game in the style of DrugWars for example could bring in new users and increase the value of Steem too if it were designed the right way. The project could be funded via SPS and then every month report their success metrics such as how many users they are gaining each month, how much retention they have, this and we can look at if the price of Steem is going up or if people are powering up more etc.
So yes, we can find a way to measure "profit". We just have to agree on which measures should represent profit.
Long term, I think the most important metric should be increase in the value of Steem tokens, but it's not always going to be easy to match that to work that is done, of course.
So I agree that other metrics will be useful for measuring proposals, and there's not going to be one or even a few metrics that will be useful for the wide variety of potential proposals. Marketing proposals could be the easiest to measure, IF they can show successful adoption by new users (especially if the users are retained over time).
The impact of new infrastructural features gets more difficult to measure, and I doubt any single metric is going to work for such things. Personally, my original vote is going to be based on how useful I think such a feature is (coupled with the price asked/etc) and my continued vote is going to depend on how well the task is being executed over time.
Can you elaborate on the dynamics of the system a bit? I mostly see it being compared to witness style voting but I know that isn’t quite accurate. How exactly is the threshold set of vests needed to fund a proposal? Can proposals be downvoted or are they an upvote only system like witnesses?
There is a return proposal (which gets votes like any other). Any proposals that get more votes than return get paid (until total funding runs out). Once the funding payout process reaches return, the remaining budget is put back in the pool and proposals below return are not funded.
The first thing I'm going to do immediately after activation is vote for return and I encourage others to do the same, then I will evaluate other proposals.
It's an upvote only system, like witness voting. It is quite similar to witness voting.
Of course there will be funding for low value projects with the usual source of beneficiaries at the top who say we need to alter rewards to stop the vote bots that many of them profit from. Right now its campaign time promising the moon, then once in place what will be will be.
It seems only you have ever heard of kickbacks. Sadly, they are how government is run, and taxes create governments.
SPS sounds like a perfect mechanism to tax from the smallest stakeholders a flow of funds to a group of cronies with enough stake to ram through their proposals. We will see what happens when we allow a group of 35 rapine profiteers that have already managed to extract ~90% of the inflation from the rewards pool to vote themselves another 10% of the rewards.
I think we both know what we'll see.
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I've certainly had ideas at the past and no doubt in the future for things to propose, but the real idea behind the SPS is to have an open system where many people can suggest ideas and provide a mechanism for stakeholders to vote on those ideas, so it's not so much about my own ideas.
Making sure that we choose wisely what to upvote is of course a key ingredient for the success of the SPS as a work allocation system. I don't know of any way to guarantee such a thing (if I did, I suppose I would be the wealthiest guy on the planet). But I think it is critical that we have such a system to increase the rate at which we grow the Steem ecosystem. From my point of view, progress has been much too slow in the past and we need to expand the available pool of people that can help out. No doubt there will be proposals that fail or don't provide benefit, and voters will just have to learn to make wiser decisions in such cases.
What are some specific examples of proposals that will be introduced through this system?
I have no idea if it would get funded or not but let's say we wanted to hire a professional Marketing firm. I could get a quote, write up what costs and benefits would be involved and see what the response is.
Thanks for the reply. I assume some of the parties advocating this system have already considered certain proposals, otherwise there wouldn't be impetus to move forward with this, so I was wondering what some of those specific plans are floating around in the private communication channels that are used to determine the fate of the rest of us.
You guys really need to work on your process and outreach.
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Thanks for the feedback!
Those with substantial stakes are inveterate profiteers, and were convincing in their assurances that they wouldn't fund development with that stake. Since the vast majority of stake is in the wallets of 35 whales, and they won't part with any of it, the only funding source left was a tax on creators, whose current share of rewards is less than ~10%.
~90% of the stake in Steem therefore will not be funding SPS, and those costs have been foisted on creators as a regressive tax - a tax on those least able to bear it. Retention last I checked was ~7.5% YOY. The median payout was .01 SBD. This tax is going to fall hardest on folks making about $.01 for their content now, and not staying here very long to be taxed already. Bye bye market for Steem. Without users the value of Steem will plummet.
The current proposal for SPS delivers 10% of inflation - the rewards pool - to fund SPS. It is completely delusional to claim that 10% of stake on Steem will ever vote to exercise control of such a mechanism rationally. There is no example of such coherent voting in Steem's history, and just because it's theoretically possible for such a thing to happen is no reason to expect it to. After all, we could all just quit arguing and fighting and world peace would break out today. It won't, and only fools will expect it to.
I have repeatedly called for prudent preparations to be made to reverse HF21 in the event my dire predictions are fulfilled. Please exercise that prudence by enabling a rapid reversal of the HF should price plummet, users hemmorhage, and market cap decline. Failing to prepare is preparing to fail.
Don't let profiteers suck the last bit of value from Steem before abandoning it's empty husk.
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Just to be clear things are being paid for by steemit. We can't expect them to make every fork and pay for them. This new system would allow us to lower our dependence on any one organization.
This is a backup plan for steem, if steemit goes bankrupt we need a way to fund development not saying they will but we need to have a plan for any eventuality. This will also allow us to come up with better features for these content creators. Development doesn't fund itself, we as a community should take the hit to guarantee the longevity of the chain.
We as a community can voluntarily decide to vote for and fund proposals as we see fit. SPS being funded as a tax on the ~10% of rewards shared by content creators whose median payout is .01 SBD is undeniably regressive.
I cannot imagine a set of proposals better designed to reduce Steem's dismal retention rate of ~7.5% YOY further. Every aspect of EIP and the SPS funding proposal is going to increase the flow of the economic activity on Steem into the wallets of the most substantial stakeholders before it can raise the price of Steem, and decrease the distribution of Steem to that demographic creating all the value of Steem by creating content.
If you want to cause the price of Steem to plummet, market cap to decline further, and to reduce the number of people creating content, I can't think of better ways to do that.
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