RE: 100 Steem Bounty: What is the solution to a lack of SMT development?
Because I don't feel that SMT's are going to be the end all be all anyways and only offer support to a very limited amount of use cases based on the white paper my current project has decided that we are going with issuing our own coin on another network. We will sort of be doing what you are suggesting with #2, but not exactly.
Currently the biggest issue is everyone wanting to use the reward pool to fund their little projects is a real issue. To much of the reward pool is needed to fund these apps and more apps added ends up spreading the pool to thin. Even at $3 steem it's still an issue as the developers need fiat to pay the bills and will create constant downward pressure on Steem. With this in mind I started trying to come up with a solution.
I am in the process of working on something that will not pull from the rewards pool in the least, but instead add value to the blockchain by bringing in outside fiat on what I imagine will be a daily basis. All bills will be paid from our fiat revenue and no need for steem for funding. This will be a real live company that will also lives outside of steemit, but use Steem as a payment option for those who want to earn Steem. The other option will be our own coin, but as that coin will be treated as a stable coin I'm guessing that many people will opt for Steem for the upside potential. These coins will need to be purchased by the company to then pay those who earn them.
A key point is this will live outside of steem and attract new people to Steem. People who never before owned steem will be exposed to free lighting fast transactions. This should help bring in new users to Steemit and more important for value new holders of Steem.
Not going into to much detail on purpose, but giving enough to hopefully let you know there are things in the works that can potentially be game changers for Steem and it's purely about Steem being a currency without worrying about the reward pool in the least.
This is a flawed circular argument. If STEEM is at $3 that means that buying support is in balance with selling pressure at that price.
Regardless of who gets it, a lot of the reward funds get sold. It really doesn't matter, in terms of selling pressure, whether that is developers or bloggers. If people think that developers getting reward funds is the best way to make Steem increase in value then it should be done. Let traders worry about selling pressure, which will happen anyway.
The biggest issue right now is that the reward pool is dysfunctional and a huge and increasing portion of it is going to nothing but SP holders voting for self-enrichment.
Trust me I get the economics that are required to reach $3 and how that would include the selling pressure from app devs. But there is no question that app devs that are relying on income from the reward pool to pay the bills will always be pulling value from the system. We need cash to flow into the system each day just to stay even due to the inflation and reward pool.
With an approach that allows for outside money to flow into Steem and Steemit there can be real value growth.
I'm all for outside money flowing in. But you missed the point I was making. As long as we have a reward pool that is usually turning into selling pressure we might as well give to devs who create selling pressure and add value by building a better ecosystem rather than give it to people who create selling pressure without building a better anything.
This is what I dispute. If there is a reward pool then the selling aka 'pulling value' happens regardless. It doesn't only happen when you award the money to devs.
If your proposal is to shut off the reward pool in connection with some other changes to improve the overall economics, I'm open to looking at that.
We have ventured way off topic here. But in terms of outflow of steem creating downward pressure on the markets I'd be really curious to see where it's coming from. I'd guess there is way more downward pressure from those running apps trying to pay the bills then from individuals who currently are trying hard to power up before the next run in price.
When you have to pay bills with the reward pool money each week you will be selling no matter the price to cover those bills. As the price has dropped the required amount of selling pressure has increased as it's constant in terms of dollar amount needed to pay the bills.
Next you need to look at the upward pressure created by the devs and individuals. Who do you think buys and powers up more steem over the last 90 days. Also would love to know that.
Wonder if someone that is good at pulling data can figure that out.
Anyways I believe that by allowing more accounts to grow faster we would be far better off then subsidizing apps with very little user base.
Problem is the key point to any social media site is that the People are the Value. All the apps in the world mean nothing without users. So those people that you feel aren't building a better anything...they really don't need to as they are building a better steemit just by being active (assuming they aren't content thieves, spammers, or scammers). If people want steemit to become mainstream they need to get over the idea that posts need to be amazing long form content, it's not what people want to produce or consume. If long form content was what people wanted twitter, Instagram, facebook, and all of the other social media sites out there would look a whole lot different.
Definitely not in favor of that.
The actual value of an individual social media user is quite low. For example, last I looked Facebook generates revenue of about $40 per user per year. So yes, I think it is reasonable to pay people just for being active, but not unlimited amounts. In fact on Steem a very large portion of the reward pool goes to a small portion of users. Most of them are not building anything of enduring value, and they are being grossly overpaid for being active.
Yes that describes a lot of them in broad terms. Or simply overpaid.
I certainly did that a long time ago. In fact I never believed it.
I think you and I are on the same page. Just about the wording more then anything. Everything you just wrote I'm in complete agreement with.
Not looking for people to be over compensated, but feel many times the wrong people are being compensated.
We do need to figure out how to let new accounts come online and actually function. I run @pifc and we do a weekly curation contest (week 35 now) and it needs to be people who are reputation score 55 or under that get featured. So we see a lot of newbies come and go...and see the issues they deal with. RC's have really messed with the ability of a new person to actually use steemit.
Some have speculated that there will be pools for RC's down the road where a community can allow it's members access to the use of the RCs it has to help smaller members function. This would be great if it happens as any account with over 500sp probably never needs all of their RC's and they go to waste.
There has actually been some development on the RC pools, so it is a little more than speculation, but I have no idea if or when it will be completed and released.
With the changes in development priorities after Steemit layoffs, I am much less confident about the likelihood of RC pools than I was before.
Something like 30% likely within one year, 70% within 3 years, where before I would have said 70% within one year, 97% within 3 years.
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I'm aware of the comment thread that follows between you and @thedarkhorse. Though I'd like to butt in and give my crypto-newbie opinion if that's at all considered.
It sounds like we're taking the assumption of "just sell it in the exchange" for granted. Has the possibility of using Steem/SBD as a medium of exchange been totally scrapped in the zeitgeist of major Steem holders?
What if I one day offers a fiverr-type service to be paid in Steem and only steem, would that sound positive or laughable?
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Not laughable at all. If a fiverr-type service that used Steem as its currency got big enough that would be great. In essence that's what all the Steem-based apps are trying to do in their own ways.
I daydream about people using Steem/SBD (maybe not SBD yet until it's a properly functioning stablecoin) for real-world interaction. While I'm code illiterate, I still want to find ways to make myself useful to Steem not just as a hodler. Otherwise the thought of "Steem is only valuable by selling on exchanges" is depressing af.
I couldn't agree more. The mechanism of incentivizing search for good content via the prediction game + curation rewards never really worked. Very small fraction of (arguably) good content gets rewarded, which in turn makes looking for it unprofitable. We at Steeve are trying to change that.
Here we described how. What do you think about this approach?
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I welcome new tools and initiatives but I don't think most of this issue can be addressed without changing the core incentivization model that is built into the blockchain.
Why is that? Where do you think is the problem with curation or what do you think would have to change?
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The incentives for self-voting and vote selling are too strong. Without addressing this, much of the inflation as 'wasted' and we end up with the perceptional and market disadvantages of high inflation without the benefits of a large treasury going to uses that actually help improve and grow Steem. Community initiatives (that I've seen so far) can only address this to a relatively small extent around the edges but don't get at the core issue.
You're right, self-voting incentives are too high and it's a big problem. On the other hand, curation never really worked even before the introduction of linear reward curve and consequent spread of self-voting.
So even fixing this wouldn't fix curation. For that, I argue, you need 1) better content discovery, so that people are able to actually find the good content even from unknown authors - this is a necessary condition for curation which has never been satisfied on Steem. Without it it's just circle jerking of known authors who have no competition and thus no incentive to continue writing good content 2) start rewarding the good content, not just good authors - this will incentivize both the creation and curation.
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Introducing linear isn't the only reason for self-voting and vote-selling. In fact incentives for high stake accounts or for methods of paying to concentrate votes were even higher under n^2. Making the payouts linear flattened the incentives but it really only did so by moving the too-high incentives from one group to another. They remain too high, but perhaps in a somewhat more fair manner (i.e. too high for everyone).
There have always been methods of finding valuable contributions, such as sincere efforts by large curation guilds, paid curators, and individual stakeholders interested in doing it. Maybe these would break down and/or need to evolve if the volume increased say another order of magnitude or more, but that has never been the issue we have seen in practice. It still does no good if the incentives don't support finding and sending rewards there once it is found, and they mostly don't.
The only method I know of that could possibly address the incentive issues (outside of a complete structural redesign) is strengthening and normalizing downvotes. You can't usefully downvote yourself and you can't really concentrate the rewards with them either. It is a bit like giving an executive a line-item veto but not the ability to spend money on his or her own. I can't say for sure it would work but it at least has a chance. There is a good deal of opposition though (in part because the 'normalizing' part requires a painful shift in cultural norms).
Unless we can try something (arguably) radical I don't really see curation having much of a future on Steem. Hopefully Steem can evolve into something else useful, like a neutral substrate blockchain for communities and tokens with their own methods of distribution.