Growing Steem to its full potential
We have identified a selection of preconditions that we think are important to the growth and success of the Steem platform. We don’t provide the answers, but hope that this can be the start of a fruitful discussion on Steem’s future.
Efficient Content Discovery
The value created by the platform, arguably almost exclusively stems from the platform’s ability to efficiently incentivize the creation and discovery of valuable content. As such, today’s stake-weighted voting mechanism has its limits. Efficiency is limited by the cognitive capacity of the users. We argue that higher voting power for individuals is needed for Steem to more efficiently discover content.
Identity and Reputation
There are numerous different ways of achieving this, including identity and/or a reputation system. Identity verification would prevent sybil attacks while giving real individuals with limited stake significant voting power. A reputation system could increase voting power for reputable users to discourage spam and increase the production of consistent, high value content.
Proxy Voting
Adding features for Identity and/or reputation directly would entail a fundamental change at the protocol level. However, one feature that could allow for parallel discovery of new reward mechanisms, is proxy voting. Currently, large investors will have to spend enormous amounts of time and cognitive resources to maximize the benefits of their voting power. With proxy voting as part of the protocol, investors could outsource the voting to “power users” who in turn get a cut of the rewards. Consequently, this feature will benefit investors, active users, and the system as a whole.
To take it even further, a company could, for instance, proxy its voting power to its user base, offering value to its users, as well as being an income source for the company. The voting power distribution could be determined by a formula of the company’s choosing taking into account, for instance, some form of identity verification and/or reputation system. It would open up Steem to a whole new level of horizontal scaling by allowing customization.
Low barrier-to-entry
In order for Steem to grow efficiently, we must make it easy and attractive for anyone who wants to participate to create value for the system and thus for themselves.
For the sake of simplicity, we divide the Steem community into three main categories: Users, Investors, and Entrepreneurs. To analyse the situation, we should take a look at it from the perspective of each of these categories.
Users
Casual Readers
For the casual reader, there is not much of a barrier to entry. Click a link and read the content. However, the impression of a closed community with biased or inaccurate content curation might put a casual reader off at the doorstep.
Curators
A casual reader can quickly turn into an active curator. Seen from the perspective of a new user with close to zero voting power, how can that user participate in the system? Voting on posts will have a discouragingly small effect, unless the user goes out of her way to purchase STEEM on an exchange.
As it stands today, the only voting power a new user has is given by the faucet. Paying money to every new user in the system might not be an optimal solution in the long run, especially considering the limited effect of this solution.
Posters
From a poster’s perspective, the strength of Steem lies in the possibility of earning money for producing good content. It is therefore important that a post is esteemed according to it’s real value. Otherwise the user will experience a high barrier to entry, in that she must spend time learning the “rules” of the community and catering to specific biases and tastes of the large STEEM holders.
Investors
As mentioned above, under Proxy Voting, it is almost impossible for an investor to get the most out of their investment. The current situation does not invite investors to actively participate in the network without spending a lot of cognitive resources to curate content. This creates a high barrier to entry for active investors, and discourages investors who would prefer to remain passive.
Entrepreneurs
Entrepreneurs want to take an active role in building the Steem infrastructure. Let us distinguish two types of entrepreneurs: partners and developers. Partners copy, deploy or integrate Steem services in their local community or network. Developers innovate and create new features and services based on the Steem network.
Partners
Partners look for attractive opportunities and easy to understand documentation and licensing that allows them to deploy Steem services through their own network effectively. Partners could be exchanges like Poloniex, social media forums like Quora, or local franchises that use the Steem/Steemit brand in their own local network.
Developers
Developers want open source tools and educational material that gives them flexibility to innovate and create new features without restrictions. Developers are looking for a blockchain with general features and good documentation giving them freedom to innovate and extend and improve functionality beyond what the reference interface allows.
Public Image
In the cryptocurrency space, the public perception of a project is important. Cryptocurrency ethics such as fair token distribution, openness and easy access to communities and resources give projects a good reputation.
In society in general, both cryptocurrencies and claims of rewards for posting and curating content is greeted with suspicion by most people. This means that Steem/Steemit needs to be exceptional in fostering a good public image.
Moral High Ground
This is one of the areas where Steem can really excel, as it represents a disruption to centralized alternatives such as Reddit, Twitter and even Facebook, where the users are the product, and get nothing back from their value creation. The pitfalls here are also obvious: Stake-weighted voting and cash payouts can seem both suspicious and ruthlessly capitalistic to many ideological subgroups. Emphasis on individual voters, their reputation, perhaps combined with proxy voting, could begin to address these challenges.
Open Source
Open Source code is important in the eyes of the public, especially in the cryptocurrency community. It is both a security measure, removing trust from the equation, and it is seen as a friendly model, giving everyone in the community a sense of ownership to the project.
Equal Opportunities
Equal opportunity is vital to a sense of fairness. Everyone, regardless of where they are from, should be able to rise in the ranks. Steemit should have a high degree of what we might call Social Mobility.
Creator of value gets value
The feeling of ownership and “belonging” in the community is paramount to a prolonged commitment to the platform. This is perhaps the strongest feature of Steem, that it pays its users to create and curate content. Again, the important point here is to make sure that creators are rewarded for content that is valuable to all users, not just to a few stakeholders with lots of STEEM Power.
Artistic Design
The user interface esthetics should not only contribute to ease of use, but is also an important part of the public image. If something looks professional people tend to like it. Clever interaction design and gamification can give a good impression while being easy to use and educational. We shouldn’t be afraid to use ideas from working designs (e.g Reddit).
Marketing
As part of the marketing there will have to be a lot of education about what Steem is and what it represents, beyond just the benefits to the individual users. People want to be part of something meaningful, and Steem should position itself as a genuine alternative to Facebook, Reddit, and other centralized social media platforms. Charity, public social events, and personal video blogging can help light up the human element of Steemit.
Robust and Secure
Decentralization of development is extremely important to grow and make the fundamental infrastructure more robust and secure. Attracting a world-wide network of active developers ensures that the technical aspects of the system are of high quality.
Responsive Evolution
To promote responsive evolution of the Steem blockchain and the various applications (like Steemit.com) they should be open for parallel development. This will avoid centralized bottlenecks for each decision and sprout novel features that can later be integrated by the other actors.
Conclusion
While we consider these to be the most important preconditions for the growth and success of the Steem platform, we claim neither that they are exhaustive, nor that the answers we have provided are in any sense final. We hope this document provides a starting point for a wider community discussion.
Signed, Christian (clains) and Manuel (spectral), BitSpace
Related content
https://steemit.com/steem/@donkeypong/rise-of-the-outer-circle
https://steemit.com/steem-marketing/@cryptoctopus/growth-hacking-casestudy--dropbox-recipe-to-500-million-users
https://steemit.com/steem/@clains/horizontal-scaling-of-steem
Identity and Reputation
Steem system is already quite complicated and this would add more layers to it. If a good reputation would give more voting power, does that mean that the user would get more Steem Power? If yes, then the reputation system would be a redistribution of funds.
Proxy Voting
I'm not sure if this would be a good thing. We need more active users – who use their own accounts – rather than investors who just want to make money and optimize their revenue. Unique active users are those people who build the community and make Steem flourish.
If Steem becomes successful, investors will get enough profit from growth of market cap and price of steem.
Curators
I think it's enough if we make new users to understand that Steem Power and voting power are the same thing. Currently new users don't necessarily get any kind of understanding of the system when they sign up.
If Steem was a game, Steem Power would be one of the most important things to have, if not the most important. There should be clear explanation for new users what Steem Power is and how they can get it more.
Posters
One important thing to make clear to new content creators is that they might need to create their own audience. If there is not enough people to vote for them, they have to become ambassadors of Steem and try to get more users to create accounts that will like their content.
This shouldn't be too difficult if a writer has already a successful blog. They already have a big audience, all that is needed is to convince them to create account in Steem and vote.
Thank you for the good input! You make some strong arguments. However, I think you are not seeing clearly the massive improvement proxy voting could lead to.
Identity and Reputation
We agree. That is why we believe so strongly in proxy voting, because it would allow Identity and Reputation to be implemented at the application layer instead of in the protocol.
Proxy Voting
The brilliance of proxy voting is that the stakeholder would, rightfully, retain the power over her own steem power, but has the option to temporarily distribute this power to other users according to her own formula. Let's say we have 10 whales with different ideas, who are also looking to be entrepreneurs in the space. They could test out 10 different ways of distributing votes to their own user base. Now THAT is horizontal scaling. Let the free market decide which formula works best! For example, we at BitSpace could get an investor involved, buy up a good chunk of STEEM and use that STEEM to establish a flourishing community according to rules that we set ourselves. We could test out reputation and/or identity systems at the application level, and use that with proxy voting to find better ways of curating content efficiently.
Today that is not an option. Our new users could vote their hearts out, but the yield for the users would be close to zero.
Curators
Unfortunately, the way it works now, a new user has close to zero voting power. There is almost no point in voting, unless you buy some STEEM power first. That is not a good way to attract new users. Give normal users the voting rights over whale power (through proxy voting), and suddenly you can have fresh curators with meaningful power in the system.
Posters
While this might work, we believe that proxy voting and the parallel development and horizontal scaling implications have a high chance of establishing voter formulas that will yield better and more fair rewards for the posters.
very nice article
thanks!
upvoting helps make sure you do the same
Proxy voting could also centralize the platform even more, if you look at bitshares for example there are some voters that hold more than 5% of the total amount of votes available, the same thing could happen here if someone gets a lot of proxy votes to his account then he will become a whale while the users who proxy to him will have no incentive to use steemit, they would just sit and wait for returns...
You have a point, but there is one problem... Passive investors do sit and wait for returns. That is just what they do. Does that mean we don't want passive investors in STEEM? Is it not better then, that they have the opportunity to power active curators and growing the community?
The percentage split in reward could be debated. However, a free market negotiation between curators and investors should be able to determine the best split. It is actually just like hiring curators, and the "salary" would be determined by negotiation. Why shouldn't investors be able to decide how to best use their STEEM power?