EIP, earning, staking, SMTs and FUD.

I will admit, I haven't read @timcliff's post yet, I did just have a look at @taskmaster4450's though and I would like to add my own brief take on the matter. This might be wrong, it might be nonsense but, I will put it out there for a bit of fun at least.

I have said many times now that SMTs should be the awarded token of the future but in order to have transactions, there has to be resource credits. Some people don't necessarily understnd this and think that in order for an account to transact, they have to have their own resource credits, meaning their own Steem or, their own delegation of Steem. This is true now but with the eventuality of resource credit pools, this is not the case. The RC pools will allow for delegation of RCs to accounts so that they can interact with the blockchain. There are many ways to do this but this is pretty much the only way the blockchain scales.

In the next 15 years, there is going to be about 400 million Steem added to the supply through the inflation pool and because this is a stake based system, much of that is going to go to where the stake today and in the coming year or two places it. Sure, people can buy it too and there is 100 million liquid Steem up for grabs, go get it.

However, if there was only 10 million new accounts in the next 15 years and none of that stake went to anyone who has stake now, there would still only be 40 Steem available for each. This is untenable. It isn't impossible but it doesn't scale and it means that while there will be a great deal of scarcity of Steem that will push price, that Steem has to also be available as resource credits.

As I see it, the idea of, "distribute Steem to the accounts that have the best interest of Steem at heart" doesn't actually mean the contributors, it means the accounts that will keep their Steem powered up and available to provide resource credits to the applications and the users who need to interact on the chain. Pure contributors are unlikely to do this because they want to earn, they want to be able to sell their Steem for value they can live with. It is the investors who are going to keep their Steem powered up and offer RCs as their earning potential as well as a little extra from the inflation pool, that will be about 6 million steem total a year in 15 years from now.

That is not much and if Steem is 100 dollars a token and a contributor needs at least 30 SP to interact at a half decent level, it means that they will have to earn 3000 dollars worth of Steem and power it up just to act. Even if all of the 600,000,000 Steem was evenly distributed between 10,000,000 accounts, that leaves only 60 Steem each. TOTAL. Not going to work is it?

However, with SMTs as the earners backed by Resource credits delivered though staked up steem investors, there is "almost" no limitation on how many users can be on Steem as Resource credits are able to be shifted on-the-fly with zero recycle time as they are non-voting tokens. This means that an SMT application end-user is able to get credited some resources at the door, and have them undelegated on signout as they have no value other than their ability to transact and create artefacts (like they do accounts now).

The applications can decide how much resources are required by users through their design and they can either provide with their own staked Steem or rent through the RC pools. The rent might mean that they distribute some of their own native tokens to the staked user who provides RCs and keeps all transactions across the system feeless for all transactors.

@aggroed was talking about faucets and sinks and Resource credits are one of the future reasons to sink Steem into vested Steem Power. The hope probably is that while the value of Steem can be high, the ongoing earning potential through leasing RC's to applications and taking a little of the inflation is enough of an incentive to keep the majority of Steem powered up and scarce on the markets.

How I see it is that the people who are actually the most valuable for Steem are the ones who are looking long on Steem, not the ones that are looking to purely earn Steem from the inflation pool as that is a losing game in the long run due to scarcity and competition. This doesn't mean that contributors are worthless unless they Power up steem, rather that eventually they will have a very good earning potential on SMTs without having to worry about Steem distribution at all as the SMTs can distribute afresh, no ninja mine, no miners and the freedom to treat their users with more sensitivity than Steem can.

Right now and over the last three years, there is an opportunity to build a stake of Steem through contribution, buying and all kinds of other aspects that can be powered up to take advantage of the future of Steem, not just the day to day earning potential. We can see that 100 million stake liquid and something like 90 million on the exchanges, many people don't see the future potential of that Steem and would rather sell. That is fine, that is good, as low prices mean that those who are looking long can both buy more and earn more from the pool, because unstaked Steem doesn't take from the inflation pool.

While many people are worrying about the little fish, I think @steemhunt is a good example of just a drop of the future potential of SMTs and distribution as they rewarded their HUNT token to users while using the blockchain and then, that token had value that benefited those who used Steemhunt. For many of those hunters, they would not have come close to that kind of earning potential if they had chosen to only be rewarded in Steem. The potential for similar applications and tokens that can go across many applications is immense.

In my opinion, reducing the low end extractors and rewarding those who stake up and use their stake more heavily is a necessary process that starts to clean up the use case for the steem blockchain from being a reward token distributor and makes it an investors token, with SMTs slowly becoming the real earners. This also cleans up the arguments across content and quality etc as the applications will cater with more targeting skill users who are interested in a narrow set of use cases.

All of this is still possible with feeless transactions and usage as long as there is enough Steem powered up to offer a massive amount of users access to a massive amount of uses. All feeless because of the witnesses who are always going to be earning Steem. Remember that they take about 10% of the inflationary pool now and that means that in 15 years, they will be splitting only around 600,000 Steem among all witnesses. That sounds like a lot but isn't if we consider that if only going to the top20, that is 30,000 Steem each. If prices don't increase, why would they bother for $10k a year?

While this is all speculative, the entire industry is driven by speculation and I believe that for Steem to be and maintain being a strong contender in the industry, it has to secure the blockchain and still make it scalable for the masses. The only way to do that long term is through incentivizing staking up and while many will sell along the way, those that don't will increasingly become invested and dug in.

As said, this is a golden opportunity that doesn't come along often in a lifetime for people to have ownership of part of the new economy, the new internet, the new employer, the new way people are going to empower each other and themselves. Those that don't want to take the opportunity and invest long term are free to go elsewhere also, free to always be unstaked contributors but what that means is always being an employee and never having ownership of ones own experience. In a future where social security is fast crumbling, owning some earning potential is going to be increasingly valuable, many might not see it yet.

Again, I am not technically-minded, I am not an economist and I am not an investor. I am a content producer, I am looking to build a future, I am hoping to play my part in something that has the potential to change the world for everyone.

All actions toward the future come with risks. Very little is as risky as staying the same in a changing world.

Taraz
[ a Steem original ]

I am sure I missed mentioning something, under- or over-stepped somewhere but, I hope it offers something you might not have considered or, something you might choose to think more on based upon it. The most important thing any individual can do on Steem is participate in the community and that can mean being part of the conversation, even if it means taking flack for being wrong.