SBD utility value in 3 easy steps

TL;DR: Here are the three easy steps for curators to give utility value to SBDs.

Step #	Description
1.	Every day visit the /promoted page.
2.	Start at the top and scroll down until you find one post that is undervalued.
3.	Vote for it.

That's it. Then, go about the rest of your day.

Why would this work?

When someone promotes a post by sending some amount of SBDs to @null with a URL in the transfer's memo field (using a specific format), the SBDs are burned (destroyed) and that post shows up in the /promoted feed. Importantly, this feed is sorted by total promotion amount, so the posts that receive the largest amounts of promotion transfers are placed at the top. Multiple people can promote a post, and a single person can promote a post multiple times (during the post's 7-day primary payout window).

It's a decentralized and competitive advertising market that's built into the blockchain.

So, by visiting the /promoted feed daily, curators would be encouraging the burning of SBDs, and by voting for the first undervalued post that you find (closest to the top), you're encouraging authors to compete for top placement.

But, right now, SBDs are not being issued in rewards payments. People who might want to promote posts can only obtain SBDs on the internal or external exchanges, and there is your utility value. People must buy SBDs in order to purchase visibility.

Right now, near-top visibility can be easily purchased for ¹/_1,000 of an SBD, so it's basically free. Curators can change that by making it profitable for authors to make use of the feature. If authors compete for top placement, this should gently "bid up" the price of visibility.

This has been tried before, and the feature has been available for years. What makes us think it will be sustainable this time when it has always fallen into disuse?

Past efforts have relied mainly on authors to promote their own posts.

This time, I have updated my auto-voter to start seeding the /promoted feed with some of the posts that it votes for. This means that, at least for a while, there should always be something there to vote for each day. My auto-voter isn't perfect at picking out posts with curation value, but it's not terrible, either. I'll continue tuning its preferences, and hopefully it will even make content discovery and manual curation easier by giving value curators a single easy place to look for valuable organic posts on a diverse variety of topics.

In practice, this is almost free due to the inactive feed, so hopefully it will maintain a steady foundation that the rest of the community can build upon.

Promotion #117 is potentially creating STEEM demand on the internal market.

Promotion #117 is burning the equivalent of ~10,000 SBDs per day. Right now, that's happening as a 50/50 split of 4,992 SBDs and 4,992 SBDs worth of STEEM (roughly 37K). The STEEM is being purchased on the blockchain's internal DEX.

However, the arbitragers who are selling STEEM to the automated burning account need a way to replenish their STEEM supplies after each purchase. Unfortunately, there's apparently not enough liquidity on markets, so they're converting SBDs to STEEM instead. This means that most of the STEEM that Proposal #117 is burning is just getting recreated by the SBD Conversion mechanism. SBDs are being burned and new STEEM are being created. The drawback for arbitragers, however, is that the conversion process takes 3¹/₂ days to finish.

You can see the combined effects in the 3^rd visual, here. We have lowered inflation, but inflation would go much lower much faster if the arbitragers were able to buy the STEEM to sell into the proposal, instead of converting SBDs.

Avoiding the doom loop

In the past, curators have stopped supporting promoted posts, and authors have followed suit by discontinuing post promotions. We might be able to avoid that this time, for two reasons:

1. SpeakonSteem has added promoted posts to the regular feed, so authors can now purchase additional views without a need for special actions by readers.
2. As mentioned above, the /promoted feed is now being seeded with some posts that (hopefully) meet minimum quality standards. Therefore, we're no longer putting the full promotion burden on the authors, themselves.

What else?

A few other points, before I close.

• If you install the Steem Curation Extension, you can see promoted posts in your feed without visiting /promoted. The extension will highlight them in blue on condenser-based web sites. (It also highlights posts with null beneficiary settings.)

• Each tag and community has its own promoted feed, so if you want to focus on promoted posts in your community, you can do that by visiting /promoted/[tag|community] (i.e. /promoted/burnsteem25 or /promoted/hive-127586).

• The mod-bot account is watching for promoted posts and posts with @null beneficiaries in the Popular STEM and Delaware Valley Life communities. If it finds any, those posts will get pinned. At current prices, post promotion provides another form of nearly-free visibility for authors in those communities. (I don't think we have many participants left from the Delaware Valley, but who knows what the future brings.)

One final point: an argument

In the past, curators have shown a tendency to put a floor under the minimum promotion amount that they'll vote for. In my view, this is a mistake. In my view, curators should just seek the first undervalued posts in the feed and trust the market to adjust the minimum that's needed for visibility. A 0.001 SBD promotion is still better for blockchain economics than no promotion at all.

Thoughts?