Steem Thoughts - Is Steem a Fat Protocol or a Thin Protocol?
Hello everyone! This is the second part of my "Steem Thoughts" series. In the first part I talked about the differences between traditional web apps and Steem apps. In this post, I am going to discuss whether Steem is a fat or thin protocol.
I think before we start, it is important to understand what is a "protocol"? A "protocol" is "the system of rules and acceptable behaviour used at official ceremonies and occasions". When we apply it in the computing context, it is "a computer language allowing computers that are connected to each other to communicate"
Source
Essentially, a protocol establish a set of rules for everyone to follow. Steem is a protocol. It does not allow anyone to just randomly interact with the blockchain. There are established rules on the inputs and outputs and this ensures a fair and predictable environment for everyone to interact with the Steem blockchain.
Fat Protocol vs Thin Protocol
The fat protocol thesis was first discussed by Joel Monegro in the Union Square Ventures blog. Traditionally, protocols are always simple and thin. The HTTP protocol is an example of a thin protocol. If you take a moment to think, the web is quite decentralized from a communications perspective. There are millions of servers all over the globe running on HTTP and thousands of Internet Service Providers connecting these servers together.
Source
The problem comes when we talk about the data layer. As technology progresses, we began to realise that the communications channel is essential but data is more valuable. This means that the more data an application holds, the more valuable it is. Take a look at Facebook and Google. They built an entire business by holding data and transforming them to useful information. Unfortunately, we have grown to a state where data is highly centralized and held by several powerful corporations.
Blockchains and other distributed ledger technologies aim to decentralized the data layer. As a result of that, the fat protocol thesis is born. With blockchain, we can now decentralize the data layer. Depending on how the blockchain is designed, it can be freely accessible, transparent and fair. There are projects that try to build privacy layers on top of the blockchain to allow users to have full control over their data. But that is a topic for another time.
Source
Is Steem a Fat Protocol?
Steem is certainly a "fatter" protocol than any communication layer (e.g. SMTP and HTTP). However, when compared with a smart contract blockchain like Ethereum and NEO, it is leaner. I position Steem as a "lean and mean" protocol. It is certainly not thin but it is not fat either. Steem is designed for very specific functions. To serve as a decentralized content store, to act as a distributed ledger of transactions, and to provide incentivization of content. The collection of these functions makes Steem a viable data layer for most social network applications. The STEEM cryptocurrency serves as a utility coin to make all these functions possible. This is even more so with HF20, as you will need some Steem Power to have Resource Credits to interact with the Steem blockchain.
In terms of capturing value, I think that Steem will not be able to capture as much value as a smart contract platform. Smart contract platforms are multi-purpose. It is like a Swiss army knife. Technically, it is possible to build social network dApps on any of those smart contract platforms. On the other hand, Steem is like a fruit knife. If you just want to cut your apples and oranges, you use a fruit knife. You can of course choose to use a Swiss army knife. It will work. But why would you want to do that when there is a fruit knife available for you?
Conclusion
In the area of business marketing, there is always an emphasis on market differentiation. What differentiate Steem from the other smart contract protocols is that it is designed specifically for content creation and incentivization. So Steem is in a league of its own. Back when EOS was being launched, there were a lot of speculations on how EOS might affect Steem. I think there is no point comparing apples with oranges. Till date, I have not seen any other working platform like Steem that is so targeted on social network applications. With that understanding, I remain bullish on the future of Steem.
In short, Steem may not be the "fattest" protocol, but it is a protocol which is fit for its purpose and will certainly be capturing the value it deserves in time to come.
Links to my "Steem Thoughts" series:
- Part 1 - Traditional Apps vs Steem Apps
- Part 2 - Is Steem a Fat Protocol or a Thin Protocol?
- Part 3 - Inequitable Value Between Users and Apps
I also believe that Steem is quite unique in terms its smart contract and yet still being a leading platform for social interactions and media. I had first looked into EOS before Steem, because at the time I did not know how everything here runs and now that I do know, I realize that Steem is on its way to a better future... but only because of the people that are part of the platform. I also feel it is less vulnerable to collapses unlike Ethereum and EOS, which rely on Bitcoins value for its own value.
I agree that Steem is built for serving its specified purpose, and it does it quite well... So why use the Swiss army knife, right...
Thanks for the comment! I think you are the first Steemian I know who joined Steem after learning about EOS first
Posted using Partiko Android
Really... I actually heard of Steemit a while back, but I wasn't too sure if it was for me. When I got into EOS, I looked up the other projects that's Dan Larimer was part of and Steemit came up. I was like, "Hey, I saw this before." and I decided to give it a try. I am really glad I took the chance though, I don't think I can ever stop being a Steemian :)
I find the uses of cryptocurrencies incredible, pages like steemit evolve at every moment and I like that, the evolution is very good for improvement. I understood your post very well, very educational and well explained. Congratulations
Thanks for reading!
Posted using Partiko Android
Is a placer read good post.
What is my low fat option? 🍒
Steem is your lean and mean machine :)
Posted using Partiko Android
Do you think you might be mistaken about Steem not capturing a large market share of value? @culgin
A Facebook clone can be launched (I.e. @steeveapp) and @dstors is on the brink of launching an Amazon clone.
Those are two of the most valuable companies in the world and I can see how Apple could integrate Steem into their iPhone apps, and Netflix could possibly tokenize their platform too.
All of the most valuable companies seem to be potential users of the @steem blockchain or at least equivalent rewards based (tokens) blockchains.
P.S Waze and Uber are two other examples that can be used on the Steem blockchain - Users can earn 'POINTS' on both!!
Good points! And you actually rightfully pointed out why Steem is unable to entirely replace a typical shared economy app like Uber or AirBnB. At least not in a decentralized way. The reason is simple. Steem do not have a smart contract system.
Don't get me wrong, Any projects can integrate with Steem and use it for a fair and transparent rewards system. However, Steem cannot be used to match drivers to riders (for the case of Uber) without building centralized layers on top of Steem.
The value that Steem can capture is huge but compared to "fatter" protocols like Ethereum, the potential is lesser.
Posted using Steeve, an AI-powered Steem interface
Thanks for clarifying @culgin this would lead us to the question of whether or not smart contracts have merit or if smart contracts are excess baggage that slow down blockchains.
@ned seems to think that smarts contracts are excess baggage but he might be biased. Some of the things he was saying though about keeping the protocol thinner while adding on centralized systems seemed to make sense.
I might have worded some of it wrong but my understanding is that etherum has problems with scaling due to the 'fatness' of their protocol.
I would love to learn more from you @culgin as it would help me determine if my assumptions are correct or false.
Thank you!!
Posted using Steeve, an AI-powered Steem interface
Smart contract platforms have their own issues. It is going to be tough for them to be addressed. You are right in saying that smart contracts are excess baggages. But that's the market which the project teams want to target and they will have to stick to it. I hope that as the tech progresses, we can eventually see a smart contract system fit for mass adoption
There's nothing wrong with Steem not having smart contracts. In fact, I think it is a wise go-to-market startegy to target a specific niches. Again back to my Swiss army knife vs fruit knife argument :)
Posted using Partiko Android
Thanks for another reply @culgin.
I think it's possible that ethereum will eventually ride their smart contracts into the ground, or they'll have to scale back some of the smart contracting if that is possible.
I've only read about ethereum and other cryptocurrencies lightly so I might be wrong but that is my general consensus based on some of the things I have read.
But either way, if ethereum sinks or swims I think you are right about Steem's approach being a good go-to-market strategy. Thanks again!!
cryptocurrencies really fascinate me when it comes to these stuff. thanks for the post!
You are welcome @rodmichael. Stay tuned for more :)
Posted using Partiko Android
An interesting conclusion ... I added you as a friend. I would appreciate reciprocity!
This post has been voted on by the SteemSTEM curation team and voting trail in collaboration with @curie.
If you appreciate the work we are doing then consider voting both projects for witness by selecting stem.witness and curie!
For additional information please join us on the SteemSTEM discord and to get to know the rest of the community!
Thank you so much for participating the Partiko Delegation Plan Round 1! We really appreciate your support! As part of the delegation benefits, we just gave you a 3.00% upvote! Together, let’s change the world!
Hi @culgin!
Your post was upvoted by @steem-ua, new Steem dApp, using UserAuthority for algorithmic post curation!
Your UA account score is currently 3.436 which ranks you at #6827 across all Steem accounts.
Your rank has improved 2 places in the last three days (old rank 6829).
In our last Algorithmic Curation Round, consisting of 211 contributions, your post is ranked at #16.
Evaluation of your UA score:
Feel free to join our @steem-ua Discord server
Congratulations,
you just received a 11.14% upvote from @steemhq - Community Bot!
Wanna join and receive free upvotes yourself?
Vote for
steemhq.witnesson Steemit or directly on SteemConnect and join the Community Witness.This service was brought to you by SteemHQ.com