Ok, this is a lot longer winded then it needed to be, but I felt like trying to get everything out of my head onto a page as quickly as possible.
I am in favor of the EIP (https://steemit.com/steem/@steemitblog/improving-the-economics-of-steem-a-community-proposal) + I am now in favor of inflation funding the SPS. EDIT: I will trust the top 20 witnesses to come up with where the inflation will come from.
Steem is a content discovery platform. I know, I know, Steem is much more than that! Sure, we can be so much more than that. You build governance that runs a social media site; from there, it can leak into all parts of life. But what Steem can really dominate is content discovery. Love or hate the EIP when Steem had 50/50 curation rewards, among other changes, we were a top ranked site. When we moved to 75/25 and linear, we've fallen ever since. The fact I am pointing out is, I don't think Steem can make it without using its superpower; if we try to rely solely on SMTs for curation, that brings the use case for SteemPower down and the distribution way down.
The part of what makes Steem great is it used the wind to move the boat; IE content creators write good content and SEO takes care of the rest.
Sure, SMTs can provide the same thing Steem does now as per upvoting; however, they are not even out yet for testing and if they were it'd still be almost like starting over from the beginning, and can we really afford to do that with big-time competitors (EOS "Steem 2.0", etc.) coming out next month? We would be pretty much losing our first mover advantage on PoB. You start with an SMT; it is new, illiquid, not on any exchanges and no proven track record. (Ask ERC20 tokens how easy it is to get on Binance just because their bigger brother Ethereum is on there.) Of course, an SMT can get to the same liquidity as Steem over time, but that is a big gamble and very expensive. Right now, Steem is the backbone of content discovery and what can propel Steem to a top-ranking website. Once we hit the top 200 of sites, it's pretty much GG, too big to fail at that point. That should be our goal as a community using inflation so that it brings more value to Steem to propel us in site rankings. If the inflation is not bringing more value to Steem comparative to its effect on the price, then it is not worth it. However, let's think for a second how this looks. If Steem as a social currency "fails" IE we never come up with a good economy, strip Steem of its upvoting powers (one of the reasons some of us whales bought Steem was for the sway in attention) - what does that tell potential future investors? "We couldn't get it right on the main currency but give us another chance with an SMT, and we promise someone out there will get it right!" - If anything, this will send out a clear signal that PoB was a failure of an experiment. It is tough for me to see it any other way, I mean it's not like we haven't tried to make it work, we switched up the EIP before, wiggling around trying to find out what works best, I am not so sure throwing in the towel on trying a new EIP is the best choice. I am sure Dan L is foaming at the mouth for Steem to give up content discovery at the base layer, it's the biggest threat we have vs. EOS.
DO we take for granted that PoB works? If we don't have PoB, we basically become EOS or ETH but with open sourced community tools such as upvotes, tags, etc. But EOS/ETH can easily copy that code and add that feature to their protocol, and they have hundreds of millions in fiat to deploy set features. Then what? Are we a poormans ETH/EOS? What is our pitch to come here if we abandon content discovery from Steem tokens use case? Where is our edge? Talk to me like I am 5 big time CEOs sitting in a room, convince me to be bullish.
I think we are a content discovery platform as written in the whitepaper. I believe if we grow, it will be off the back of curating authors, so they continue to make excellent content and SEO becomes the wind to our sails to island top 200. Hell, Steemit even has issues - they are USA based and adhere to all USA laws. Every front end is going to run into this issue. While big ad companies don't rule Steemit, the fact remains our use case is giving people money to produce value, period. Paid to play, paid to post, paid to curate, paid to do, the point is the inflation pays people based on the upvoters desires. You can try to convince yourself or me differently. But having talked to as many people as I have when you say Steem people think of getting paid to post or do x; if it walks like a duck and quacks like a duck, it's probably an f'ing duck.
Now, this brings me to flexible rewards, where the curator chooses how much they want to upvote. While I quickly realized it would be a race to the bottom via 100% curation upvotes, that still gave authors free "publicity" whereas if Steem became a top site again that would be a beautiful thing to have. The one fatal flaw here is distribution. Ah yes, that overused under sexy word everyone keeps hearing. I would argue distribution is the single most important thing to Steem or any currency. If you have lame distribution in DPOS, you have a centralized system, full stop. Now I can already hear people saying Steem distribution is already jezzy fekted because of the early miners. I will argue that EOS distribution is also jezzy fekted and they had a one-year ICO trying all they could to make it fair. Money isn't fair. What is the golden rule? He who has the gold makes the rules. If tokens can be purchased on the open market, that is the fatal flaw to your perfect distribution. So, if the distribution is destined to get jezzied in the end what's the point? The point is to have as decentralized of a distribution as possible — blink blink. Distribution doesn't end; it lasts forever theoretically (if your token has inflation of any kind). SO, if we can make it that the new tokens get into new people’s hands, that is the best goal one could ask for. Miners are way worse than authors when it comes to dumping; most bitcoin miners dump the coins to pay for their costly mining rigs (cost way more $$ to be a profitable bitcoin miner then Witness on Steem). I would argue, someone like realwolf and many other witnesses keeps/power up their Steem earned for protecting and validate the chain. I would argue authors also do the same, ya some sell but the ones I upvote, for the most part, at least power up some of the SP. Each author that powers up Steem creates another curator, another finder of content, another way for Steem to win.
Now insert SMTs, with the EIP on the table, it goes hand in hand. What do you need to run SMTs? Why RCs from Steem of course! With the EIP, it's my belief authors will earn MORE, not LESS. I have talked to many curators, and they all agree they would stop selling votes and start upvoting content 100% because that would be the most profitable. I personally would inject curator hulk with steroids, and you'd potentially see a 1mil SP hulk in your upvotes. Why? Because it would make me more money WHILE making the platform better. It is hard to be a virtuous beggar, IE if you don't have it you can't give it.
Everything in life should be about bettering your financial prosperity WHILE bettering your community/family and surroundings. If you do one without the other, you become vulnerable with less ability to grow. If you make money while destroying your surroundings IE Steem right now people selling votes while sipping tea in a burning building, you end up destroying the very thing that feeds you. If you build up the community and make no money, you become a burden to others and or take yourself out of the game by quitting and going to find a 9-5. What's the point of a 9-5? To make money. Could I do what I do if I had to work a 9-5? On a 95% less scale, yes. SO, you find what does both, makes money and builds the community, a conveyor belt to success. If people MAKE MONEY curating, THEY WILL CURATE. It's really that simple. I am not speaking out of hand, I am one of the largest curators on the platform, I spent over a million bucks out of pocket on Steem, so these words come from the horse's mouth. You can listen to my PoV or shrug it away, I do speak the 100% untainted truth of my experiences here, and I know other curators that feel the same way.
I want to make a wager, that the 150+ content creators I currently upvote daily, if 90% + of them earn MORE Steem than they did before the EIP changes, I win a big pat on the back. If they earn less, I will donate $10,000 worth of Steem to the charity of the communities’ choice; we will run a poll. I am very confident that the authors will make way more than they are now, just a hunch from a curator. ;) Keep in mind I joined Steem as an author because I didn't have much Steem back then to curate. I am an author at heart and always will be; I wrote a book ffs.
I didn't touch on the curve or downvotes. I believe the curve will combat self-upvoting, forcing people to curate if they want to play the game for max ROI. Pretty simple, you force people to play by the rules, and if they do, they earn the gold. I believe the downvotes will be a HUGE game changer and trending will look way different. I will use all my free downvotes every day and will encourage others to do the same, targeting trending page garbage. The new downvote system will make anyone think twice of posting up trash and upvoting it with bots, the downvote army will happen. I also believe malicious downvoting won't increase nearly much when compared to the probable increase of good downvoting. Because if you want to downvote someone, losing some $$ to do that won't stop you, look at the famous flag wars we have. Downvotes of passion are going to happen regardless of what they cost, and adding free ones isn't going to make people more passionate about downvoting, sure they may get more ammo, but I would argue these are rareish type people. Most people who hodl Steem want to see it do well, thus won't go around downvoting people just to do it. Reputation also plays a roll, there are several natural barriers that block malicious downvotes, while good downvotes will be praised by the community, thus encourages people to downvote spam more. Plus, I will double my efforts to combat malicious downvoting, and I am sure others will too. The rewards that get put back into the pool will help the entire platform, authors will make more, curators will make more, and trending will look better. Is it a cure-all? Hell, maybe, I certainly think it will change the dynamics of trending and make people think twice before promoting anything because they can do at a profit today. Jeez, people right fcking now can promote a piece of shit on trending and actually make ROI, right now they can and hardly anyone will downvote it. And even if I wanted to combat it, I could make a tiny little dent that wouldn't make a difference, except my ROI would be trashed in the process. That is not a good sell. Buy Steem and use it all to downvote content on trending. It won't make a difference tho! tehehe!
I wrap this overly long message to say, I believe Steem is the upvote of the internet. Every app I create on Steem will utilize Steem upvotes alongside SMTs/Steem Engine tokens what have you. Steem is needed for RCs to use the platforms, thus they should be spread far and wide to people who want to power up and use Steem. Curation is the best way to get the most RCs into the hands of people we want to see have them. While not perfect, I argue if you are looking for perfection, it will never come. Sometimes you must make the leap and figure it out when you land. Right now, the boulder Steem is sitting on isn't stable and is slowly sinking. Right now, we have the right angle and timing to make a leap to success. The window is surely closing, and before too long the ledge we want to reach may be out of site. One thing is for sure, if you are not moving forward, you are moving backward, and if we look at our website ranking, it is clear which direction the current economy is taking us.
I'm going to kill it here, cheers peace!