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RE: Improving the Economics of Steem: A Community Proposal
I think fixing the economics has priority over SMTs at this point. If the economics don't work then who is going to be using Steem for the SMTs to matter?
The issue is that unless we have communities to test these economic theories, no one really knows if what they are doing to 'fix' the economics is going to work.
We've had a community to test this for over a year now (steem has existed longer but I'm talking of current situation with bidbots), and as you can see, there's really not one to speak of.
Community. We need that ies or it doesn't count. When we have hundreds of communities (or fine maybe just dozens) each one can do something different and PROVE their theories. Stabbing in the dark is how we got here, and some people think we are worse off than 2017 in this very comment chain.
Should we go linear? How about super linear? Parabolic? I don't know, but I know that if there are all three at the same time we can test them
We've already tested the current rules and they clearly don't work as well as we need. So we're not stabbing at the dark here at all. But it all depends on how long the SMT's take time to get out, we can't really wait for year or two when we have competitor coming out that's backed by big money in few months only, that's specifically learned from the issues Steem is facing...
We have dropped 30 places on Coinmarketcap in the last two years. We are worse off now than then.
Not only would that require for us to wait for Smts and communities, it'll also require some SMTs to reach a level of recognition, legitimacy and market confidence that would dwarf the underlying Steem token for voting behavior surround that SMT to be indicative of its viability in terms of economic incentives.
This is basically impossible in any reasonable span of time.
Just because we have to speculate over the the economic equilibrium of a change doesn't mean we don't have any intelligent things to say about it.
100% hyperinflation is a bad idea, because in 30 years, the currency increases by 1,000,000 times
n^2 is a bad idea, because someone's who has 1000x your stake will have a vote 1,000,000 your weight
linear and low curation is a bad idea because it leads to content indifferent profit maximization voting behavior (ie self voting and vote selling)
I don't need to test these to tell you they're completely off. I can also give you numbers around around curation rewards, rewards curve, separate downvote pool size, curation curve that are at least not completely off and likely conducive to getting the behavior we want at an acceptable cost.
It's hard to do worse than what we have so what do we have to lose? The status quo doesn't merit caution. Why fear changing it?
That's not factually correct. Curation rewards fundamentally encourage content agnosticism and financial manipulation of voting to maximize rewards extraction IN ADDITION to self voting and vote selling. You can verify this by considering whether any minnow ever gamed curation for rewards, without doing either of the others. Someone might have, but it's so small a financial return for small stakeholders they didn't do it for long.
Curation rewards are only significant incentive to game for financial rewards. They do not encourage anyone to curate content qualitatively, and since author rewards are highly gamable, are essentially merely additional incentive to game author rewards. They don't even matter to folks without substantial stake, and no one with substantial stake is able to curate both for content quality (actual curation) and maximize financial extraction. Folks intent on ROI ignore quality for gamability.
All curation rewards are counterproductive to curative purposes. Even if 99% of rewards were curation rewards, this would not change. Conflating curation with extractive mechanisms replaces content quality with financial return as incentive to vote, no matter what the curation rewards rate.
Boy I guess this is the part I am very unsure of:
I actually think it would be very easy to do worse. That doesnt meanim against everything, actually I am testing 60/40 curation on weedcash.network right now; its an incentivized test net.
The problem with testing our economic equilibrium accurately is that it requires people to actually care about the currency. That means the stake has to command a certain level of real world legitimacy and confidence for the voting behavior to be indicative of anything.
This is why I'm against testing it out with SMTs and other currencies that have yet to be really established.
Smart traders paper trade their systems first, and then find that reality behaves differently. This is why large quant funds do back-testing first and then forward-testing with small allocations before scaling to meaningful size.
I go back and forth on this a lot. I think test nets are important, and SMTs will give an opportunity to test a lot of things. On the other hand, the most important impacts will only occur if the change happens universally across Steem instead of being opt-in.
Long-term, I don't think it all matters that much. SP holding will be about RC's instead of vote value, and most of the value distribution will be SMT's within communities. We do have to actually survive to the long-term.
While I responded negatively to your other comment about the tax, I think you are correct about the overall impact (and need) for these economic changes.
I'm also skeptical that we can survive through to the long term without a reasonably functional economic system in place for our base token. As a pure bandwidth token, many other projects have beaten us to it, and can do what we do faster and better.
I think test nets are better used for technical tests of function than economic behavior. We're interested in the latter which can only happen if people really really cared and are playing with real money. Maybe I'm being insufficiently imaginative with SMTs that can be pegged to certain other currencies etc, but I don't see people caring about them for a long time for voting behavior surrounding them to be a useful indication of anything.
I'm all for SMTs, and I think even if these economic changes are implemented alongside them they'll take no more than a weeks worth of extra dev time.
This.