The Steem protocol MUST distribute new STEEM tokens that are continuously created over time.
Users can and are encouraged to profit-maximise by fully using their allocated voting power everyday. This could be a mix from manually curating, trailing votes, selling votes, etc. (To clarify, everyone's voting power replenishes by 20% per day. To check, insert your username at the end of this URL https://steemd.com/@username)
There are only two distinct outcomes to voting: wealth accumulation (self-voting, vote-trading) vs wealth distribution (voting others, curating). There are other terms like selfish vs selfless voting, stingy vs generous. But I think they're ultimately not very good terms, since by trying to act selfless and generous, I'm also being selfish in hopes that STEEM's value increases over time through what I do as a voter.
Voting to accumulate wealth enriches a smaller group, slowing network growth. It encourages lower quality contributions, because less actual contributions are being rewarded.
Voting to distribute wealth enriches a larger group, speeding network growth. It encourages the better quality contributions, because more actual contributions are being rewarded.
Currently, it's much more profitable to adopt a voting behaviour that purely accumulates wealth vs distributes wealth. Why should actions that slow network growth be rewarded more than actions that accelerate network growth? Now voting activities on this network is converging to simple wealth accumulation, simply because that's where the money is.
IMHO, Steem is operating like a premodern economy at the moment.
Images taken from Sapiens: A Brief History of Humankind.
Users are going to vote according to their own fleeting whims anyway, so the profitability of both types of voting should be more or less the same, instead of being vastly different. Wealth distribution activities should be just about as profitable and as equally risky to partake in compared to wealth accumulation activities.
When distributing wealth becomes as profitable as anyone using 100% of their own votes for themselves or their circles, maybe unnecessary spam filler posts and comments will reduce in the process.
At the moment, 25% curation rewards mean that voters only gain a small chunk of their vote's worth in return. The rest is given to others. Voting to distribute wealth isn't so profitable even on what voters think are the better contributions. Curation rewards are too low.
Test #1: Reduce curation rewards to 0%. This will obviously cause more wealth accumulation. There are no incentives to distribute wealth to others.
Test #2: Increase curation rewards to 100%. Maybe not obvious to some, but this is also encourages wealth accumulation behaviour no matter how anyone votes. Simply because it's 100% returned to voters and none is spared to authors. Quality of content / contributions are also expected to be much lower, since there are no authoring incentives on the table.
Test #3: Maybe all we need is balance. Increasing curation rewards from 25% to 50% may render voting activities a fair and equal risk for both wealth distribution and wealth accumulation behaviours. In the beginning, persistent wealth accumulation will still be most profitable. But rewards from curating good content now have higher chances of yielding better profitability. Plus, voters also know they're getting back ~50% of their votes, instead of only ~25% in this current setup. The effects are two-fold. Firstly, wealth distribution behaviour becomes less costly and less risky per vote. Secondly, this new economic scheme may sometimes provide better returns for wealth distributors vs wealth accumulators as more users take the fair risk to distribute wealth by curating quality content (could be through intermediaries like curation communities). So all in all, more voters are encouraged to distribute wealth because it also has the potential to accumulate just as much wealth for voters at the same time.
In effect, we could use an economic model that renders both voting behaviour equally profitable, statistically. Maybe this is the equality that our community should be focused on. The network may have a better chance to improve when more users are persuaded to distribute wealth as well, instead of purely accumulating. The only way to do this effectively is by making wealth distribution activities more profitable, maybe to the point where it's synonymous to wealth accumulation. Curation communities should be just about as profitable as vote bidding communities, if not better.
Finally, why is slight superlinear reward curve maybe necessary? Firstly, to reduce unnecessary spam. Secondly, slight superlinear makes it necessary for all voted content to have a minimum of at least one other peer validation from higher SP users in order for more substantial wealth to be distributed, unlike zero validations at the moment. Thirdly, to congregate and amplify the best and worst voting behaviours for community self-regulation, instead of having them distributed flatly and widely like what we're experiencing on the network at the moment. Fourthly, to make vote bidding price discovery less predictable.
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