Bid bots are a way to inflate the rewards on the Steemit platform. I used the word "inflate" and not "increase", because bid bots are an "artificial" way to generate revenue, as opposed to the "organic" way to get rewards, by being upvoted by your regular followers.
How Does It Work?
Before diving too dip, I would like to recommend @yabapmatt excellent https://steembottracker.com. You will get a much more appealing image of what bid bots are than the brief description that follows below.
Basically, there is a time window of 2.5 hours between two bid bots, roughly the amount of time necessary to regenerate the actual bid account voting power. It seems that all bid bots are using the same time frame and they split their "rounds" into 2.5 hours chunks.
During any of these "rounds" or "sessions" you can send a certain amount of SBD / STEEM to the bid bot operating account and wait for the end of the round. Other users can send tokens as well, and that will dilute the potential voting power. Each bot also has an upper limit (cap) and a certain ROI (Return of Investment). There are also some other parameters, like the age of a post that can be voted upon, wether or not the bot will post a comment about voting that content, etc.
So, based on the bid bot max cap per round, its ROI and the numbers of bidders, you will get a vote. That vote will increase your initial investment with a certain amount.
Most of the time, in my experience, this amount is between 5% and 7%.
So, if you bid $10 worth of STEEM/ SBD, you will get back between $10.5 -$10.7 worth of STEEM AND STEEM POWER! It's important to understand that the rewards you get by using bid bots are still following the normal STEEM voting algorithm (so half of it will be in STEEM POWER).
How The Test Was Conducted?
For a week, I tried about 4-5 bid bots, based on various criteria: the max cap, ROI and wether or not they were publicizing their activity. The posts were just random posts that I write here (mostly market snapshots). I sent the bids around 1 hour after the post was live. The amount I sent was between 5 and 15 STEEM.
What Have I Learned?
There are a few cons and pros to bid bots (in their current form).
Here's what went well:
- the fact that you can increase the revenue with a predictable amount is tempting
- the fact that there is a (very rough) way to bid for user attention is encouraging
Here's what I consider not too well:
- there is no "intrinsic" value to the posts that are being upvoted by bids, so you can end up with a simple thing, not worth anything under normal circumstances, taking out a certain part of the reward pool
- because of the inconsistent publicizing of the bod bot vote, I noticed the rise of another type of bot (mind you) that is commenting on the posts upvoted, stating that the value of the post is not from organic curation. Under "normal" circumstances, I think bid bot votes should be public, so a post can have some sort of a "bid bot sponsored" badge. In line with this idea, I think the "sponsored" posts (those using bid bot votes) should have a different way to be displayed, not mixed with organic voted content.
I see bid bots as an intermediary evolution stage of attention bidding mechanisms on Steemit. In their current form they are way too rough to provide value to the ecosystem and they are only drawing a certain amount of reward pool to people willing to use them. Please understand that I have nothing against getting an ROI on your investment, but if the only form of influencing the user attention is money, then Steemit will be no better than Facebook, or other social media platform that are selling advertising.
I do think that, as time goes by, there will be a lot to be learned from bid bots and they will eventually evolve into something less toxic.
I just don't know how long this will take.
I'm a serial entrepreneur, blogger and ultrarunner. You can find me mainly on my blog at Dragos Roua where I write about productivity, business, relationships and running. Here on Steemit you may stay updated by following me @dragosroua.
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