Was I wrong about Hardfork 19? Probably...
I recently posted about my optimism about Hardfork 19... But then I reada post by @neoxian called Bad feeling about HF 19 where he points out a caveat I was not aware of...
He makes a pretty clear point in his post, but let me put it in my own words.
What It Affects Badly: Voting Synergy
The Case Prior
The exponential curve does not affect just the value of each vote, it also affects the payout a post gets. So while each vote had a certain value, the facts that votes were pooled together for a particular post increases the payout not by mere addition, but exponentially as well. This means that people voting for the same thing leads to synergy.
The Linear Curve Destroys That Synergy
Now with the new linear curve (a straight line) it is not only the value of each vote that is affected. The exponential effect created by people voting on the same thing is removed as well. I was very surprised to learn that as it didn't (and still doesn't actually) make much sense to me. I think the weight of each voted could have been adjusted without destroying the synergy created when people vote on the same post. So what I wrongly and optimistically expected to happen was that the value of each vote would be calculated in the new supposedly fairer way where each unit of STEEM weights exactly the same, but then when people are voting on posts, there would be some synergetic effect created by an additional curve or algorithm. I guess that was quite naive and not very well thought-out on my part. Unfortunately, something like that would have probably been the right way to go and might be a solution to look into for future hardforks.
The Wrong Incentives
The worst consequences of those changes the way they are setup right now is the fact that it creates the wrong incentives and could easily backfire. The lack of synergy and the decrease in daily votes available to spread around would incentivize larger players to vote more conservatively and is likely to end up concentrating power towards the fewer larger accounts and the expense of the smaller accounts since there will be less love to go around for left field shouts.
Of course, this community is great and I will not be surprised if a lot of whales act responsibly under the new rules and continue to do their best to better the platform instead of just taking advantage of it for their personal gain. Still, I'm less confident that HF19 will end up doing what it was designed to, but let's see. No turning back for now anyway, right?
I hope all of us are still positive about the great future ahead of this cryptocurrency and platform, I know I am!
Oh, and please call me out if I have gotten something else wrong as well...
Ok I'll try to explain it. The problem is that Steemit can't actually give credit to different accounts voting on the same thing. Why not? Sybil attacks my friend.
Imagine this (simplified code)
There are certain people in the system who have managed to gain control thousands of accounts. If the code above were implemented, you'd simply be exchanging one set of whales with another. Those bot masters would become your new whales.
Instead of this, the system only knows SteemPower. If ten minnows (accounts with 10 SP) vote, the effect will be 100^2 = 10000.
But a single account of size 100 SP would get the same treatment
100^2 = 10000
Bigger accounts become "groups" unto themselves, which is why whale accounts feel so powerful.
There is no easy answer to this problem, but putting a power cap on the biggest whales could be a thing. That's basically what the non-whale voting experiment is doing right now.
See, I knew I was still getting something wrong ;)
Thanks again for the explanation! I think your comment is actually more valuable and enlightening than both my posts on the topic so I really appreciate you writing it ;) Unfortunately not enough people will actually see it here, so if you feel like it, I think many of us will appreciate you going on this tangent in a stand-alone post.
So if I understand you correctly, the network needs to walk a fine line between giving too much power to single accounts that hold a lot of Steem Power which happens with the exponential curve and giving too much power to bot masters who can sockpuppet large pools of account to start creating an equivalent of whale votes by having large pools of accounts voting in unison. But this can really be a serious problem only if we have "two different curves" as I ignorantly suggested. I agree that this would be even less fair because with the N^2 curve, we at least have correspondence between being invested in the system and having influence over the system. Opening up the network to Sybil attacks (which I of coures also checked on wikipedia ;)) would exchange the current whales who do have a merit and a rightful claim to influence with people who would be gaming the system without having a corresponding stake in it.
I guess the little bit of Steem Power loaned by steemit to new users is something that could still be a basis for a Sybil attack, it just requires a really huge scale, right?
I wonder, how is the network currently protected against individuals who want to have 1000s of accounts and game the system? My guess would be that can never be 100% protected, but settings like the curve we are talking about can make this difficult enough to not e worth it for potential abusers.
I could not have said it better.
I will add the SP is SP, in other words, owning 1000 acounts with 10 SP each is pretty much the same as owning a single account with 10000 SP when it comes to affecting post rewards (or witness voting). Reputation is a different matter. It's easier to get a single account a high reputation.
Nice investigation work!
Cheers Dave, i have some thoughts on HF19 and am trying to put together a blog currently. Whilst i understand less this linear curve business, i hope there is a way to keep everyone in action come tomorrow when the HF becomes live.
Oh, I'm sure most of us are still on board regardless of hardforks and curves. But let's see how it goes. I'm sure the community will evaluate the effects in week or two or a month or two and hardfork 20 will end up being awesome one way or the other. Or at least I hope so!
Yeah I'm sure so. Here's my effort if you fancy a look: https://steemit.com/hf19/@abh12345/hf19-pulling-the-ladder-up-or-more-encouragement-for-minnows-to-buy-steem-targeting-500-steem-power
Quite honestly! I think most people like me that are fairly new to this can't make heads or tails out of the voting situation. So I will continue posting, commenting, and upvoting while I gain more experience with the process.
I agree. I think it's certainly a conversation worth having, but I also think that we should remain active, engaged and honest in our voting, posting and commenting behavior here. If all of us keep doing that, things will continue to be looking up.