Steem Solved the Prisoners Dillemma
Based on my read through the Steem white paper, the complex integration of multiple concepts around the reward structure, vesting timelines, and social dynamics leads me to one simple conclusion: Steem will cause paradigms to be shifted in ways not seen since the Bitcoin white paper made its debut on the world.
Now this is a bold claim and I had better come correct if I don't want this to be filed into the #circlejerk filebin of crypto-history, so I'll start by making my claim.
Steem solves ...
If such a thing is 'solvable' in the traditional sense, I submit that Steem has figured it out. Quickly, it would be important to define my terms of the 'Prisoner's Dilemma', so this argument can be assessed on its merits.
The Prisoner's Dilemma is defined in it's simplest form as ...
a game analyzed in game theory that shows why two completely "rational" individuals might not cooperate, even if it appears that it is in their best interests to do so.
It demonstrates the challenges of getting two or more 'rational' parties to instinctively work towards cooperation when faced with decisions of how to behave in an environment. This is particularly a challenge whenever there are financial interests at question. Consider the DAO Attackers perspective on how Ethereum should behave.
However, the complex yet elegant integration of different concepts seems to present a very strong long term picture when implemented, very similar to the sort of dance Satoshi Nakamoto (and friends, in my opinion) orchestrated in his white paper.
Consider the result of integrating the following concepts in content marketing ecosystems:
1) Powerful incentives for ecosystem investment ('Going long on the platform')
With a strong degree of confidence in the system from the early adopters (always the case), sunk cost investment into the ecosystem is a visible group choice. New users are encouraged to invest in the system rather than to look for a 'quick flip' of profit. The number of available and liquid STEEM is known via blockchain statistics, as is the amount of STEEM POWER invested into the platform. Plus, the whales have a much harder time manipulating with so much STEEM frozen in power ups.
2) More Perfect Information via Blockchains
Everyone can know the same information that would potentially drive internal Steem market dynamics. All market indicators are available to be modeled and theorized on. Bots can be made to interact with this data and behave according to specific algorithms and plans. This makes the process of 'selling the pickaxes during the gold rush' that much simpler. The information playing field just got much more level.
3) Two Way Incentives Encourages More Engagements
Curators who earn by showing appreciation for what they just looked at? Commenters earning for chiming in from the peanut gallery? All because some other character rolled their head on the keyboard and hit "Post"? Yep. All of that... and you can too!
4) Reputation Based Constraints
With great Steem Power, comes great responsibility. Villains and ne'er-do-wells have very little capabilities in this platform due to the way negative voting effects rewards. Those who behave 'against the whole' or even 'against the majority' simply do not receive rewards. Reputation and trust can be lost in identities, but people can not lose their identity in this platform. This encourages improved behavior or a simple reset. The blockchain doesn't lie and we know what you did... repent!
So apparently, when you combine those four, rough factors, you get an environment where value is created exponentially because it can be rewarded exponentially. What we all consider to be valuable is something we can all work towards because the information we have to support the value in that destination is clear to all.
When people act a fool, which they certainly will, they can be corrected, or not corrected based on the available information to the ecosystem. If their behavior is truly beneficial, this will play out on the open stage rather in the back rooms where most deals are made.
Solving the Prisoners Dilemma within the realm of content marketing generates opportunity for those who are clever or passionate enough to create things that are considered valuable to fellow participants. We're seeing the first swings of a giant flywheel right now. Each evolution of abilities, perceptions, and players involved will shine light on a new area of value creation based on desirable content.
What did we learn when the giant three-dimensional puzzle of financial Prisoner's Dilemmas was solved?
The size of this pie is not fixed.
Great post! The two way incentives is huge. I think a lot of people intially have a mental hangup on the idea that Steem Power isn't super liquid. But neither is real estate, CD's, Bonds, or Venture Capital.
That is a good analysis. Steem solves so many problems simultaneously that it's amazing to watch. I have been following @Dan from the Bitshares days. I've invested in that too. I knew all the pieces were there just needed to find the right combination. Looks like he found it so far.
@blakemiles84 that's a great tagline;
'Steem ~ the size of the pie is not fixed'.
Use it! I don't even want credit. If it resonates it's a win. Hell I think I heard it as a concept from @bacchist maybe?
A tad bit over my head (out of my realm of understanding) but thanks for your input and I hope steem does rock things up a bit.
No worries brother! TL;DR = Steem as a package solves the problem of aligning incentives 'naturally', rather than by coercion
Once you can see through the matrix, you have ability to see how these things WILL change humans paradigma about what actually is freedom and responsibility. More and more creativity is waking up because of self preservation instinct of humans. I am in love with future of humanity. Great post :-)
You point out some concepts that I've seen as great advancements in social platform technology...I'm still curious to see how this all plays out when the population of the platform grows and the new developments that may bring.
Great post!
"Steem will cause paradigms to be shifted in ways not seen since the Bitcoin white paper made its debut on the world "
exactly this !!! steem is so simple and yet so complex.
The only thing I would say is wrong is that malicious actors are heavily incentivized to work against the system.
Now, just because they may be acting outside of the system does this mean they are not part of the game? Should their incentives not also be considered?
Consider this: https://steemit.com/steem/@robinhood/offline-attack-on-steem-user-credentials
And this: https://steemit.com/steemit/@positive/warning-easy-potential-social-engineering-hack-steemit-hack-temporary-solution
(The latter is powered by the fact that Sybil attacks are so affordable on Steem.)
And the plethora of other threads on security that haven't seen the light.
The dictionary attack could have yielded thousands to an attacker, the social engineering vulnerability can yield thousands to an attacker etc
Why would they bother exposing vulnerabilities?
Unless the emotional value they extract from being a non-malicious user is high or unless their investment in Steemit is high, I see little reason not to attack the system.
Otherwise it would not be rational to favour the white-hat approach that carries lower expected value.