Steem Distribution: Aligned With Other Blockchains And Changing
People often complain about the distribution of Steem Power and how the system is unfair. I am here to show how not only is Steem in alignment with other blockchains, it is one of the better systems out there. It is time we took a look at a few of the other well known blockchains to see how Steem fares.
Bitcoin
The best place to start is with the grand-daddy of them all. Bitcoin just celebrated its 10th birthday, compared to Steem approaching its third.
The point that stands out here is that .65% of all the Bitcoin accounts control over 87% of all the tokens issued.
Litecoin
Litecoin looks a little better with 1.64% of the wallets controlling 85.79% of all the tokens. This blochchain was started in 2011 if memory serves me correctly.
I wonder if Charlie Lee selling his entire stake had something to do with these numbers. I surmise it did.
EOS
EOS engaged in a year long ICO before going live. This was done to give people a change to get the tokens in an effort to level out the distribution. How did that work?
At the time of going live, there were 163,930 wallets with any EOS in them. The top 1,000, or .61%, held 85.81% of all coins put out.
Also interesting is that the top 10 wallets held almost 50% of all the EOS.
*This is the breakdown at the time of going live: the numbers could have changed some in the last 8-9 months.
https://www.trustnodes.com/2018/06/03/just-10-addresses-hold-nearly-50-eos-tokens
Ethereum
It was just reported that over 80% of all Ethereum is held in 7,572 addresses. This is astounding considering the fact that there are over 50 million Ethereum wallets out there. I will state that I would not use this number to figure out the percentage since there are a large amount of wallets that were set up and nothing was done with them. Like with Steem, I do not find it applicable if someone sets up a wallet and no Ethereum enters it.
We can go through the Rich List that was used for Bitcoin and LItecoin to get similar results. Looking through Dogecoin, Dash, and the Bitcoin Forks nets the same scenario.
Steem
It is important with Steem to find where we stand now and if things are changing. So let us review some different charts. We use Steem Power since that is what yields the influence on the Steem blockchain.
All charts will be from @arcange. Here is the latest.
There are 398,689 MVests total.
One interesting piece of data is that 89.66% is in the hands of the Whales, Orcas, and Dolphins. The number of accounts in these categories is 2,352.
https://steempeak.com/statistics/@arcange/steem-statistics-20190310-en
For number of accounts, I use those that have Steem Power in them. We know there are a lot of accounts set up and people do nothing on the blockchain or post once, then leave frustrated. I figure those with at least 1 SP are active to some degree, hence earning Steem somehow.
This gives up a total of 264,312. That means that .89% of the accounts control 89.66% of the MVest (or Steem Power).
So let us review:
Bitcoin .65% controlling 87.09%
Litecoin 1.64% controlling 85.79%
EOS .61% controlling 85.81%
Ethereum .15% controlling 80+% (presuming 5M wallets with actual Ethereum in them)
Steem .89% controlling 89.66%
In terms of the present distribution, Steem is in line with other cryptocurrencies out there. It is important to remember, with the exception of EOS, Steem is a number of years younger than the other blockchains.
It is also crucial to look at the trend and pace of change. I like to use the month I joined as a barometer which is about a year and a half ago.
On 8/1/2017, there were 336,932 MVests.
On that date, the Whales and Orcas held 90.3% while the Whales, Orcas, and Dolphins made up 97.46%.
Today, the Whales and Orcas hold 76.24%. Combine them with the Dolphins and you get the 89.66% of the total.
There is another interesting point to make:
Today's numbers see 376 Whale and Orcas as compared to 268 on 8/1/2017. At the same time, the W,O, and D totaled 1,417, in contrast to the 2,352 today.
8/1/2017
https://steempeak.com/statistics/@arcange/steemit-statistics-20170801-en
What makes Steem a bit different than most of the other blockchains out there is the ability for accounts to earn STEEM and power up. Each week, there 800K STEEM available in the reward pool. This enables the distribution to change over time even if people do not purchase STEEM using fiat (or other cryptocurrency).
Over the past 18 months, we saw the amount of SP held by the W,O and W,O,D drop as a percentage of the whole while the number of accounts in those two categories grew.
Here is the shift spelled out.
W,O 8/1/2017 268 Accounts 90.3% of the total
3/10/2019 376 Accounts 76.24% of the total
W,O,D 8/1/2017 1,417 Accounts 97.46% of the total
3/10/2019 2,352 Account 89.66% of the total
Shorter Term
The shift is noticeable on a shorter term basis.
On 12/31/2018, Whales accounts for 57.13% of the MVests. At the same time, we saw the Whales and Orcas make up 77.23% of the total.
In less than 90 days, we saw the Whales drop to 53.86% while both, combined, fell to 76.24%. This occurred while Whale accounts remained at 35 and Orcas jumped 27. Certainly, Steemit powering down had an impact and gave all other accounts greater stake.
Conclusion
There are two main points to take away from this:
A) The distribution on Steem is right in line with other blockchains. This is actually to Steem's advantage since it is newer than most of the other ones out there.
B) Due to the weekly reward pool, the distribution is changing over time. The stake the larger accounts have of the whole is steadily decreasing even as their numbers grow. To me, this is how the system is suppose to work.
Another point is that we are seeing a shift at the lower end too. Each week I post the accounts at different intervals below 5,000 SP. I started this at the end of November and the results are consistent Every week, we see gains in each category tracked in terms of the number of accounts at each level (there were a few weeks were one or two did go negative). While I cannot say that we are seeing an acceleration at that end, I can relate that the growth is consistent there too.
Basically, more accounts are acquiring Steem Power AND moving up to higher levels.
In my opinion, Steem's distribution is not much different than other blockchains and we have a system that is changing it. Over time, I expect it to even out. Watching the lower levels add more accounts verifies my belief that they will, collectively, start to take up a larger portion of the reward pool.
Give it enough time and we should see the MVest balances flip flop.
If you found this article informative, please give an upvote and resteem.
Great data! Thanks for sharing ! I will be thinking about it for some time, maybe do some math, and try to understand this better. Still, I would love to see more of that steem power from 10-10.000 being better distributed, since we are millions of at steem, and many good content still don't get a fair share. But, don't get me wrong. Great post, keep up with your good job. Bring more insights to us all! Thanks!
Hopefully we will see that shift taking place.
There is a big push on now to create more Minnows. The goal is to get to 10K, another 800 or so.
That is a great starting point in my opinion.
Hmm
Distribution seems to continue being problematic..
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Yes. I am more optimistic about Steem spreading the distribution out than some of the others.
At least with Steem, people are receiving tokens on a daily basis for their activities on here. Most of the others require people to buy in.
Yeah that's also one of my big arguments why I like steem so much.
You can start from nothing.
And learn so much stuff on your way up..
In other projects you mostly have to buy in. And the biases in the community may be stronger.
At least it seems so to me.
People also keep forgetting that there is no real fight between blockchain projects.
They are more likely to work together and improve each other on the way to a great ecosystem.
You'd think that if the STEEM price appreciates along with BTC and the demand increases, that whales would have more incentive sell on the open market, which would continue to flatten the distribution. If you have a bunch of whales standing pat powered up, it means they are confident in the future price of STEEM, and are willing to hold out. At some point they are going to want to trade some of that STEEM for houses and Lambos! I think it will be retail and new investors that pick up the majority of that.
This is slightly off topic,but I've been looking around out curiosity and coming up empty... do you happen to know what the delineations are for the different categories?
Like, when does a dolphin turn to an orca and so on?
1 MVest = 499.47 STEEM presently. Steem moves in multiples of ten
Minnow 1 MVest (499.47 SP)
Dolphin 10 (4994.70 SP0
Orca 100 (49947 SP)
Whale 1000 (499,470 SP)
Right on. Thanks!
I figured you would know.
It's just sorted in mvest amounts :)
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interesting
Bitcoin .65% controlling 87.09%
Litecoin 1.64% controlling 85.79%
EOS .61% controlling 85.81%
Ethereum .15% controlling 80+% (presuming 5M wallets with actual Ethereum in them)
Steem .89% controlling 89.66%
Even with a super low inflation rate it’s going to
Be hard to change this balance in the short term but as active users grow it will spread out more.
It is and will be slow going in the short term. To really make a dent, the Red Fish and Minnows would need, maybe, 100K active users. That would create enough activity to pull in a decent amount of the daily pool.
There is no where near that amount of accounts.
Distribution is improving and with some near term focus on the Minnow class, I think that will expand further! #tenkminnows
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Great article. A very intersting analysis and let's hope that things change more and more as time goes on!
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