Facebook carry out a "strategic takeover" of Steem? NFW!

Image source: Hackernoon article

The article "Facebook and Crypto: what you need to know for 2018" looks at the top 50 cryptocurrencies and tokens to see which are the top three that Facebook might have an interest in utilizing in some way, including actually acquiring them as they have done with hundreds of companies previously.

It concludes that they might be interested in a "strategic takeover" of Steem and:

they could add a “super like” button. Now when you see amazing content, instead of just liking, you can let them know you care. Or donations. Like if your friend gets married or has a baby — you can send a few dollars their way just to say congrats!

and then create a marketplace for spending Steem for goods.

It notes of Steem:

Facebook can’t just acquire it in the traditional sense. They could, however, “adopt” the community — ensuring a large amount of resources being put into the community are Facebook controlled.

Well here is my response to that idea, which I think stems from an incomplete understanding of Steem. It also covers the comments about Bloom and MetaX

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I can’t ever imagine Facebook going anywhere near Steem for several reasons:

1. The primary use of STEEM is to reward content and curation on the Steem blockchain accessible via various frontend apps including the eponymous Steemit. That’s a completely orthogonal world of content and users to Facebook unless you are actually suggesting all FB content would be put onto the Steem blockchain. That would lose them so much control that it is basically unthinkable —see 2. and 3. If not, then merely adopting Steem as a currency… well they might as well use any cryptocurrency then.

2. The Steem community is basically the anti-Facebook. They would fight hard to stop any actor from trying to change the Steem blockchain to be friendly to a massive centralized entity like Facebook. Using the community elected witnesses Steemians can control how Steem evolves. I don’t recall if witness voting is weighted by the amount of Steem held but I think it is highly unlikely that the Steem community could be usurped either by STEEM votes or user votes.

3. As awesome as the Steem blockchain it would be hard pressed to scale to even current Facebook activity levels (that we know of). Searching around I find figures suggesting Facebook gets almost five million posts, comments, and likes per minute. That's 83K TPS. Even though it is an industry leader Steem handles around 1.3M transactions per day which is a mere 15 TPS. Although Steem’s underlying technology Graphene is quoted as “capable of 100,000 TPS maximum TPS when we pay for the network to go with it” I don’t think anyone has actually demonstrated that IRL, it’s more of a theoretical number. I’m guessing it will never scale that high with a configuration of globally distributed witnesses running consensus nodes, just a tightly coupled cluster of machines on a very fast low-latency network. And this is only considering the transaction throughput - what about the 4 petabytes of data per day they generate. Do you think our witnesses could handle that? Yeah, didn't think so.

The reality is, if Facebook were to go anywhere near a cryptocurrency as a reward system (and I’m sure it is working on such things, or at least trying to figure out where it fits) it would just create its own, completely under its control, and completely owned by them.

I think you’re much closer to the mark on technologies like Bloom and MetaX. I know quite a bit about Bloom and I think it has a) a great team, b) a really well-designed system where identity, rating generation, and, data are all well separated. Although they are initially focusing on the loan and credit-rating space it seems like that are also realizing the value of their identity system. Something like BloomId or Blockpass could easily become a global standard IMO just because it is very flexible and leaves control of the ID and associated data with users not centralized systems like Facebook, Twitter, or Google.

Probably a better strategy for Facebook would be to let a solution like Bloom flourish (blossom?), help its adoption in any way without strangling or tarnishing it with the FB name, and then when prevalent enough adopt it as an option for sign-in. That’s assuming they see value in actually letting users adopt a system that gives them complete control over their data. What do you think?

I think that’ll probably happen when Facebook has a gun to its head either by legislative might in Europe where the governments actually protect their citizens (instead of tolerating wholesale leaking of virtually the entire population’s credentials as has happened in the US and then not moving to punish those responsible or legislate a fix). Alternatively if Facebook is facing a credible competitive threat to usage by systems already using decentralized identity solutions like Bloom then they might offer it to try and retain users.

Anything that can reduce ad-fraud is going to be valuable to Facebook but their ads are pretty much a closed system. AFAIK they do not place ads on the Web as a whole, just within the Facebook ecosystem. Therefore they have tight control over that world and can implement their own highly specialized, highly centralized systems.
But hey it never hurts to ask the question “What would Facebook acquire/copy/takeover?”