Response: LIVE DEBATE ABOUT STEEM!!!

My response to LIVE DEBATE ABOUT STEEM!!!, primarily responding to Tone Vays

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Tone calls Steem a ponzi within his first 2 minutes of talking. There is plenty of documentation, on Steem itself, about what a ponzi is and how Steem, by definition, cannot be a ponzi. The worst it can be is a bad investment, but since it's not intended to be an investment, that's kind of a given too. Tone beats this drum throughout the debate, but provides little in the way of support.

Tone also relies heavily on Bitcoin elitist sophistry, favoring passive-aggressive comments like "if it even is a cryptocurrency." OK, so what definition of "cryptocurrency" are you going with, Tone? Google's definition is:

cryp·to·cur·ren·cy
/ˈkriptōˌkərənsē/
a digital currency in which encryption techniques are used to regulate the generation of units of currency and verify the transfer of funds, operating independently of a central bank.

Investopedia's definition is:

A digital or virtual currency that uses cryptography for security.

OK, so is it a cryptocurrency? I'll leave it to the reader to decide. To me, there's no question.

Later, Tone resorts to outright FUD, saying But there's absolutely no record or proof that it has security; in fact, it's already been hacked. Someone has been able to create unlimited amount of STEEM.

This is an outright lie. No STEEM tokens have ever been created due to any hack. In fact, the blockchain was not hacked at all. The Steemit.com website was. Some keys got stolen, and Steemit Inc has already made that right. Now, most likely, Tone just has no idea what he's talking about, but that hardly makes him innocent. In legal terms, lying for the purpose of defamation is known as slander, but I'll just call it trolling.

Tone goes on: The whole system is designed to trick people into locking it up into Steem Power.

Setting aside the insulting paternalism, this claim is spurious at best, and he does nothing to support it except repeat it like a mantra. Steemit.com clearly warns when one tries to power up:

Steem Power is non-transferrable and will require 2 years and 104 payments to convert back to Steem.

So where's the trick? Where's the deception? Justify yourself, Tone.

Another of Tone's specious claims revolves around users being penalized for holding STEEM. First of all, that's deceptive language: STEEM holders get diluted, but not penalized (props to Blake for pointing this out!). And Tone claims that this is "tricking" people into powering up, to avoid the dilution. But guess what, Tone? Steem Power holders get diluted too! Not as much, but they do (contrary to Tone's repeated claim that SP holders double their money every year). Everything about Steem is designed to encourage engagement with the app, and if you stop creating value, you get diluted out.

It's almost like Steem is designed to be a useful application, not an investor trap. It's almost like it's exactly what it says on the box!

Next, with more insulting paternalism, Tone tells Blake to his face "I'm taking the position that you didn't [know what you were doing when you powered up.]" This is an interesting debate tactic... staking one's argument on a trivially falsifiable (and, in fact, already falsified!) claim. I'm not sure how to respond to this one.

Moving on, Tone spreads more FUD, now claiming the authors of the chain have control over the powered up tokens. This is more or less equivalent to saying the authors of the DAO have control over the DAO investment tokens, which are locked up by smart contract. It's simply false, and I strongly doubt Tone would care to defend that claim if pressed by someone who deeply understands blockchain technology. But Blake did a decent job calling him out on this (and Blake, by his own admission, is a relative newbie to blockchain tech).

Now finally, for the first time IMO, Tone makes a legitimate point that deserves response: that Steem pays out its rewards in tokens, many of which are Steem Power, and so it's just paper returns with no backing. This is actually a failed argument, since the Steem Power is immediately valuable as voting power, but the related argument, which Tone doesn't actually make, that the Steem Dollars are just debt with no backing except today's market cap, does have some merit.

Yes, there is absolutely risk of defaulting on this debt, and that's a risk all Steem Dollar holders take. Of course, this is the same risk as one encounters holding any other dollar in the modern world: they're all debt-based; however, the ones from banks are historically based on outright fraud (which gave us, among other things, the housing bubble) so we're almost certainly better off holding blockchain debt than bank debt. Now I admit that this point is dangerously close to a tu quoque fallacy, so let me also highlight the fact that the blockchain has a lot of logic around managing its debt and ensuring it does not become insolvent. All Steem Dollar holders can inspect this logic and factor in their own knowledge to determine whether they want to hold that debt or not, and the platform makes it quite easy to sell that debt for liquid STEEM, and plenty of exchanges allow trading of Steem Dollars directly.

After this, the debate ended and Q&A began and, for the most part I have no comments on this section (though it was certainly worth watching) except for when Tone postulates that Steem is not a blockchain, because he defines a blockchain to involve "Proof of Work immutable value transfer." I contend that is a useless definition for blockchain, one which does more to confuse matters than clarify them. Wikipedia does a fine job of defining a blockchain, and by that definition, Steem clearly fits the bill.

If anyone would like to know exactly what a blockchain is and how it works, I, as a blockchain architect, gave a seminar at Harding University on exactly this topic. I welcome anyone to question my competency in this regard; there's a comments section right below. :)

In closing, I'd like to thank all of the guys in the video for putting this on. Much respect to @blakemiles84 for doing a fine job representing Steem here; everything he said was clear and accurate. I will refrain from further comments on Tone's performance. ;)

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With a background in software development and a passion for security, Nathan has identified blockchain technology as his niche. He is dedicated to creating applications which empower individuals to shape a better world for themselves and others.