Some questions I have about the STEEM reward pool
I have some questions about the reward pool that I could really use an answer to when trying to explain STEEM to others.
I had a conversation with a witness about it a couple of days ago but it’s still not 100% clear to me.
First my own assumption about the reward pool
I think that the reward pool is a fixed amount of newly created STEEM being rewarded each week to the platform. It's distributed according to vote weight.
75% goes to rewards (content creation and curation)
10% goes to witnesses
15% goes to interest on all existing Steem Power
If the inflation of STEEM is 10% of 250 million total STEEM out there. That means 25 million STEEM is created each year. 25 million / 52 weeks = around 500.000 STEEM is the reward pool each week.
I don’t know if this is true, it’s what I think.
Numbers
According to the reward pool counter on Steemspeak the reward pool at the moment is filled with 1.3 million STEEM.
So, this doesn’t match with my previous assumption.
There is simply too much STEEM in a 500.000 (fixed) reward pool. So, the pool must be a lot bigger. But how big?
What is it?
How much STEEM can there be in the reward pool? Can it actually be full?
How much STEEM leaves the reward pool each week? Is the reward pool a flexible thing were sometimes (for example) 100.000 STEEM is rewarded in a week and sometimes 500.000 STEEM. Are there rules for this?
As an investor and a user, I feel like I should know these things, but I have to admit that I don't.
Any insight would be highly appreciated.
Thanks
Follow Me @exyle
HI @exyle - I thought I would wait and see if anyone more knowledgeable than me (like @abit) replied with 100% and accurate info, but since nobody has yet I'll at least reply with my basic understanding. Please note, I have not actually read the code behind this, so it could be wrong. I am pretty sure it is accurate though.
At block 7,000,000 have a 9.5% instantaneous inflation rate, decreasing at a rate of 0.01% every 250k blocks. We are currently at block 11,522,830. So the inflation has dropped by .18% since HF 16. (Currently 9.32%.)
The inflation is based on the virtual supply of STEEM (which accounts for the SBD in addition to the actual STEEM). Currently the virtual supply is 252,237,004.123 STEEM.
That means that every day, 252,237,004.123 * .0932 / 365 = ~64,000 new STEEM is generated.
75% of that (64,000 * .75 = 48,000 STEEM) goes to the content rewards pool (split between authors and curators).
The rewards pool is not full yet, but once it is, it should have approximately 30 * 48,000 = 1,440,000 STEEM. At that point, the amount of STEEM going in each week (7 * 48,000 = 336,000) will be equal to the amount of STEEM going out each week.
Where it gets complicated (I don't have a full understanding of this) is that the amount that goes out each week will not be exactly 336,000. Some weeks it will be higher, and some weeks it will be lower. In the long term though, it should average out to the number.
Hope that helps :)
Very valuable info. Could have been a post onto itself. I had forgot than the pool is now a 30 days pool and not a 7 day pool.
Thank you very much for your reply and calculations. It helps a lot. The witness I spoke to said the reward pool can change a bit here and there because it continuously is moving trough time. I can understand that. It's not really hard fixed per week, so, for example, a downvote now can have some ripple effect later on. (at least that's how I understood it). But I'm happy to read the average of newly created STEEM was at least in the same vicinity of my own calculations. Thanks again!
Will you confirm that the reward pool has less than 48.000 Steem per day to split between ~15,000 authors?
If this is the case, it makes pushing folks into the 100's of Steem per post even worse.
If one 300 Steem post means that 99 posts are at zero, that is going to make this place very hard to sell to anybody that isn't favored by tptb.
The amount of STEEM in the rewards pool sounds about right. Where are you getting your number for the number of authors though? Also are they active every day?
The platform is not designed to give every active author a lot of money. Some authors will make more than others. It also depends on a lot of factors, including the quality of the author's content, and their social networking.
@bitgeek is putting out a report that has conflicting numbers with what I have stated, when I get time I will reconcile my numbers.
https://steemit.com/steemit/@bitgeek/payout-stats-report-for-26th-september-2017--part-i
Do you know how the progress, the new STEEM is created and distributed to reward pool, vesting fund and witness, is recorded in the blockchain?
Yes. If you are interested in learning about it, the best place to start is the bluepaper. There are more technical details in the whitepaper.
Thank you for replying me！ You are the very only one discussing on this problem!
Surely I've read the bluepaper, and it told me the inflation rate and the distribution proportion. However it didn't tell me in what form these inflation is created and distributed, or in what form these inflation and distribution in recorded. Given just the block data I can't find out how many the witness, vesting fund and reward pool get respectively.
I'll appreciate if you can tell me more detailed information regarding these problems.
The witness pay is credited to the witness who produced the block. Each users' vesting funds and the rewards pool get incremented each block. As far as I know they are all done as virtual operations, so they don't necessarily show up as data in the block itself.
That's exactly what i guess, but i wonder how can they know the precise number and make the change? Maybe use some global parameters and the block height to calculate?
It is calculated based on the formulas that are described in the bluepaper.
But we should know some numbers, such as the virtual supply of STEEM, it changes all the time. Where did a block get the information.
A very good discussion to get going!
Thanks @exyle!
Thank you!
You're welcome @exyle!
Edit: I thought for a moment inflation was at 20% and not 10%. I remembered that wrong.
I'm pretty sure inflation is 9,5%. I just used even numbers for simpler calculations. Hopefully, someone that really knows shows up and we all can get our questions answered.
I replied to the post with the info on inflation.
@timcliff will be able to answer this perfectly!
Unfortunately, I do not have a full understanding of the new rewards pool math. I would recommend talking to @abit. He has the best understanding of anyone I've talked to.
I did reply with some info.
Yes, you are very great. Saw your response! Thank you alot!
Good questions!
2 more weeks before the reward pool is full, my up vote is worth 30 cents now, will be worth $1 when it's full
Wow! If this is correct that mean the pool is only a third full. I hope you're right.
Good question to ask. Would love to know the answer too!
I've noticed this page (which is only visible on my phone for some reason, not on my PC when I visit steemd.com) but the "reward_balance" has been increasing every day now since the hardfork, so I'm guessing once that stops the reward pool is full.
This post has been ranked within the top 80 most undervalued posts in the first half of Apr 30. We estimate that this post is undervalued by $1.24 as compared to a scenario in which every voter had an equal say.
See the full rankings and details in The Daily Tribune: Apr 30 - Part I. You can also read about some of our methodology, data analysis and technical details in our initial post.
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very nice photo