The maximization curve

One thing that came up in a few conversations I have had is the strategy of earning passive income. I have some things to add to the conversation in this area for the future, but I thought I would remind people of something that many seem to miss. As humans, we all want to maximize our returns and minimize the effort it takes to get there, we all want to take the smarter, not harder approach. However this is always going to depend on our starting resources.

The example I will use for this is the delegations to bidbots. Even though it is a straight line return for the most part, there is a difference if someone delegates, 1M, 100K, 1K or 100 SP. Each will maximize their return on the stake delegated but that return is significantly different.

What people seemingly fail to realize that even though the option maximizing return on stake is available, that is rarely the best way to maximize value earned from the blockchain unless one is already highly staked. The value of the blockchain really is the community and what that means is the value is in the relationships and network that ties people together.

All of this is dictated by game theory and there are many paths and while a large stake can earn enough for themselves passively, a small stake rarely can. Maximizing the direct return on stake comes at a cost to being able to reward the community directly and instead it turns a blind eye to the network yet, still distributes. This makes it very hard to build a personal network of value when one essentially says they they don't value the community enough to take a hybrid approach.

I myself delegate to @ocdb, the whitelisted @ocd bot that supports previously curated content. It is not the highest return for delegated stake but, it is going to people who have proven themselves at least once on the blockchain they can create decent material. I don't do this to maximize return, I do it to support content producers and hopefully help build a strong community of future curators. However even then, I am never going to delegate my entire stake to them as I want to be active, I want to be sensitive in some way to the community and of course to my followers. As a result, less than 25% of my active stake goes to this path with the rest used for community and personal growth.

The games people play with their stake are a large part of their experience here and those who are absolute maximizers often forgo the potential of building valuable relationships. Many forget that there are many views of the blockchain these days and it is easy to see how people interact. Just like when people who abuse bidbots or use them exclusively rarely build a strong community around them, those who delegate to them exclusively without adding any staked value to others often find themselves somewhat of an island. Islands that require to be fed from a pool distributed by community rarely are going to get enough.

What I would like to see an increasing amount of is small staked users pulling their delegations back from bidbots for a time and use it to reward the content they actually like, the content they connect with and want to consume. Yes, the content is free to view and consume already but one can't expect to get value added to their content organically while delegating personal stake out to automated voting. For those who consider themselves decent contributors, having stake to reward readers can be a vital part of network growth, just like an app that has stake to distribute is.

Of course, this is just a recommendation based on my own approach over time and no one need take it but I do think that if at the lower levels the stake were to be actively used within the community, other factors will come into the light that will increase organic curation. It might not be a great deal more but widening distribution at any level is better than concentrating it predominantly on a very narrow band of users, many of which are only part of the community in order to extract value, never put in.

There is a lot of power in the community that goes beyond stake but how one uses the stake is a pretty good indicator of how one views the community as an individual. This is a a blockchain of options but it doesn't mean that the path taken by one is going to lead another to the same place and therefore, each user can take the time to work out what is the most beneficial path for themselves. Sometimes what appears to be a path of smarter, not harder is actually a position of limitation that sets a hard ceiling on return, which is fine if that ceiling provides what one needs under it, if one needs to raise the ceiling to get enough though, maximizing can be detrimental to well, maximizing.

As I and many others have said, the value of the blockchain is the community but a community is made up of active participants who provide some portion of the work the community needs. On the blockchain, part of that work is in curation and network development and if one doesn't take the time and effort to develop and build relationships. There are many ways to do this and lots of ways to approach being part of the community but this is a stake based platform, and if those with stake are only looking for passive income from their own but expecting active income from others, there is a conflict of philosophy and approach.

One thing that can be said about Stem though is that with so many ways to interact, everyone should be able to find a path that both allows them to grow and helps others also. Finding the balance is a continual negotiation and the dynamic nature of change i the system means that what is suitable today might not be tomorrow. The responsibility of the individual is to do the best they can and the best is rarely to be completely passive and blind.

Taraz
[ a Steem original ]