Some thoughts about funding SMT's
Yesterday @steemhunt announced their SMT airdrop where half of all tokens would go to voters, delegators and existing Steempower shareholders. I resteemed the post cause I thought it was an excellent way to decentralize their tokens while at the same time funding their initiative and at the same time I got excited about the future of SMT's and what they will mean for Steem.
I believe that @steemhunt won't be one of the few to create tokens in this manner. As someone who has been around for quite some time and experienced ICO's that started by accepting Bitcoin and Ether in their crowdsales and then also used the blockchains in their projects there is a lot of sacrifice happening by using their costly blockchains for transfers. The explosion in ERC-20 tokens has proven that the Ethereum blockchain is not ready for that kind of traffic yet as we have noticed with Cryptokitties and the recent 4chan games that became big and ate up a big percentage of their daily transactions.
The negative aspect of this is that you have to outbid other transactions for the mining network to accept yours before theirs. If you remember what happened during the BAT crowdsale that sold out in half a minute and due to the big demand to get their transactions through investors had to pay top dollar to cut in line - leaving many average users out from the crowdsale. This is only a small part of the problem, there is also the issue with you having to get rid of your Ethereum that you believe will appreciate in price over time for an investment. It is kind of like betting that the investment will outdo the profits Ether would bring over that same period of time.
Not only is it risky and requires a lot of research to invest in ICO's, their teams are the ones that now hold Ethereum. If they end up not being trust worthy and defaulting on their project, they will cause big downtrends in the price of Ether which will be like a double negative for you who in hindsight should've just kept your Ether to begin with. Of course there are also many legitimate ICO's but time after time it has shown that many of them have died or stopped moving forward.
With SMT's though there is a completely new effect to be had. With the SEC stomping down on certain tokens and qualifying them as securities due to their promises when accepting investments, I believe that many projects in the future that decide to start their funding on the Steem blockchain will look into not accepting investments because of that.
They will instead do similarly to @steemhunt where they fund their projects through upvotes, delegations and other various ways that the blockchain enables them to. Projects won't have the need to "lock" funds they've received to gain trust to their investors over time as they will be rewarded funding over time instead through upvotes and delegations. Investors and users will be able to cut their delegations if certain criteria is not met and maybe even go so far as to continuously flag their attempts to reward themselves with the SP they have gathered so far in the case of a bad actor. Of course we will still have to be careful with what we fund with our voting power and delegations since it is not difficult for them to just power down the funds onto another account and abuse it there.
The other thing that has a huge positive impact onto funding SMT's will be the lack of having to divest your SteemPower to be able to invest in these projects. It is quite a unique method of funding projects with newly created Steem that will decrease the risk factor of investors by a lot. Once we see the huge boom in new projects starting out and using these methods for funding it will also increase the huge demand for holding SteemPower as you will directly benefit by having helped funding these projects and being rewarded with their SMT for it and continuing to reward them and relevant posts about the project with Steem/SBD and the SMT.
I for one am really happy that the Steemit team has been working so hard on making sure that the blockchain will be scalable and ready for all these transactions and user growth. I know there are many users out there complaining and whining about how much the front-end lacks but there is nothing stopping other people to create something that out-does Steemit. Look at busy.org who for instance is incentivizing users to use it instead through votes and a better layout with more options.
I want to say that what is written in this post is only my point of view and its not all too technical, feel free to further discuss details in the comment section. I am really excited about SMT's though and looking forward to how it will all unfold and what genius projects will come to light through it.
Thanks for reading!
Owk since I heard the news about steemit, it's been jolly jolly alll the way with lots of good sides to it. I am quite shocked at this post because I never really knew there were some risks to this.
As at this morning, according to @exyle's vlog, steemhunt has received over 100k delegations and counting, meaning that people are really buying into them.
Well I might not know so much about them as you do and might not get to even participate because I don't have enough sp yet to delegate but i will just stand aloof and see how this pans out. It could turn out good after all.
100k sp is totally insane! This is going to be wild!
I think that I am ready and then I don't think I am ready to invite my friends and family to Steemit because I am still confused about a lot of things, but I absolutely love this platform and what it has brought to me. So I try to share it with people that I think would be great at it and one signed and others are going to check it out. They are confused with all these cryptocurrencies, and so am I, so I just tell them to try it out, start making posts and commenting and making friends and from there they will learn since that is how I got started.
I sort of want to wait till I start making better money to show them that this is working and they will want to join in.
I really like your point @acidyo of making them want to ask questions and interested in this, then just throwing all the information at them for the first time. I think I might be guitly about that, but they were interested and kept asking me questions, so I just kept answering the best way I knew how and just told them to start doing it and learn from that.
Yeah I've been holding on on inviting people in masses as well until they get their registrations fixed so it doesn't take a long time for approval. I think once that is done we will see an explosion in new accounts daily.
Wow that's the great . Thanks for reply
I have dreamt of doing a guerrilla steem campaign once this happens, we need to bring all the fan fiction writers into steem! especially the harry potter crowd, steem needs their content!
"Harry I don't remember your wand being this long!"
"Hagrid! that's not my wand, Its my slytherin!"
I should stop visiting those sites but I can't! help 😭
I did read the post from @steemhunt and also the one of @taskmaster4450 about it.
But I still don't understand how we could participate into it! For sure if you don't have enough power to delegate.
But like you wrote it is a great sign for the Steem blockchain. Really looking forward to HF2.0 which should go life Q3 this year.
Than we will have a much clearer idea how things will evolve!
I think you'll get some tokens by just upvoting their posts as well.
Mhh, will try it our and let you know :)
I think the SMT’s are a game changer and is going to help bring more users to the platform and increase the price of Steem and viability in the long term.
It seems to me that focusing on creating a scalable blockchain rather than a pretty UI was a smart decision. There are so many different ways to interact with the Steem blockchain and as more people come to the platform, there will be more developers who can build a better front facing site for blogging.
We have already seen the likes of Zappl, DTube, and Steepshot created as their own variation of Twitter, YouTube, and Instagram.
Being able to fund the projects with delegations is a game changer!!
It is a game changer indeed and am thankful for steemhunt for showing us that! They do know how to get this frog hot!
Fair points!
I'm really hoping that this is a signal for chance with regards to how people a) view their liquid rewards - ie. Power up more of them, and b) choose how to use their SP.
Yeah the bots are currently paying well, but spreading some around to projects like @steemhunt to take advantage of airdropped tokens, will hopefully see accounts choosing this option too.
And yeah, screw the interface here, if you don't like it, use another. What was mentioned in the @steemitblog yesterday is more important and has potentially, far more potential to increase the value of our STEEMs.
Cheers!
You can imagine how im agreeing to you right now as im waiting for my ETH token transactiion for the past 2 hours with a 2 dollar transaction fee. 2 dollar transaction fee...
SMT has been talked alot about by @ned. And he seems pretty invested in it. But without it's implementation, I'll always have a healthy amount of skepticism as to whether it really will become a reality.
When SMT does roll out, goodbye ERC-20...
I'm starting to think that SMTs are going to be the catalyst to the bubble popping of many altcoins built on Ethereum.
It definitely will.. entrepreneurial people will start suggesting companies to ICO usint SMT since its way easier and it wont take many SMT to get media attention.. Once that's done its all going uphill.
you mind sharing with me why do you think that @tim3w4rp?
Sure.
Consider Steemhunt, for example.
They will be distributing their own tokens built on top of SMTs, once they go live. Not in a way ICOs on Ethereum work, though. To be able to jump start their business, they came up with the idea of distributing those SMTs to Steem Power delegators.
You delegate to steemhunt -> you gain a share in HUNT tokens. It gets more complicated, hence the link. You can read more there.
The point is, Ethereum does not have the power to do this. There is no delegation there. You simply have to buy the token with ETH.
You could say that I have to buy Steem and you would be right. But the delegation gives you the power to seamlessly transition between projects. Meaning that I have the freedom of taking my money out of certain projects to put in into other in a matter of minutes.
Not bad, it's a cool idea for token distribution. So it means that the value of steem will go up even without skyrocketing of SBD (Like the last time).
It is quite a unique method of funding projects with newly created Steem that will decrease the risk factor of investors by a lot.
As a result of which more people will invest in steem because people are afraid to invest in crypto and when the risk factor will be minimum more people will invest and the steem platform will grow and touch the stars.
I hope SMT will bring positive result, wating for SMT wating for good days of STEEM.
I am really excited about SMT's though and looking forward to how it will all unfold and what genius projects will come to light through it.
Same is the case here @acidyo, I am also excited a lot.
I'm getting excited about SMT now, i can't wait for its launch, please tell me when is it going to launch?
thorough SMT we can have many benefits and some of them are listed in the post @acidyo, you have done well man, steem is a blessing and SMT will add new life to it 😊
Do you guys always vote each others comments up?
yeah we do
: <
is there any problem friend?
I'm personally not fond of vote-trading, plus I usually reward good commenters that don't self-vote/vote-trade on their comments.
oh so sorry 😑 will be cautious from now on
Hi, I’m one of the creators of Steemhunt. Thanks for such a great view on SMT as well as mentioning Steemhunt.
We are actually building a concept of HUNT coin based on SMT platform, but the timing is not ready yet. We want to build the healthy community first before the ICO (especially nowadays there are too many ICOs for not-even-a-single-user-existing app 😂).
Anyway, thanks again for your great post 👍