Giveaway as a Token Distribution strategy
A recent phenomena emerged, where new projects sell tokens within seconds of a crowdsale launch - and most of those tokens end up in hands of a few whales.
There is nothing inherently wrong with a couple of strong hands holding onto a large stake, however a narrow distribution might not be optimal for a project where the token serves as utility, or life blood if you will, of the network.
A hypothetical example of such network would be a platform for content creators, where the token is used as a social currency, as well as a mean to pay for things like storage. A good initial distribution would help with bootstrapping user adoption, increase potential monetary velocity and hopefully accelerate growth.
This post proposes token giveaway as a potential vehicle for widening of the initial token distribution, and explores some synergies in doing so.
Without a doubt, one of the most valuable assets Steem has is the community. If we are to give tokens away, we should gift them to you.
Who gets the tokens?
We would like to reach out as many people as possible, while avoiding spammers and inactive users. We also need to be mindful of the wealth inequality. It is hard to distribute the token fairly, as we need to rely on quantifiable metrics. The simplest proposal is to use Steem Power holdings as a proxy.
First, we need to set some constraints, on which users to exclude from the distribution.
Having a min threshold eliminates bot-created accounts, and accounts that haven't contributed to Steem in a meaningful way (either trough posting or as stakeholders). It also dis-incentivizes spammers from creating more accounts, and causing further damage to Steem's account creation faucet. As a bonus, it might also have some positive market pressure, when people buy some Steem and power it up to reach the min threshold.
We should also impose an upper cap on SP > Token conversions. If we don't do this, the whales will end up with most of the tokens, which defeats the purpose of the giveaway.
And lastly, we should exclude all accounts that haven't been active in the past few months.
Example:
| SP | $ value | |
|---|---|---|
| Min | 100 | $200 |
| Max | 50k | $50,000 |
This yields a distribution that includes nearly 10,000 Steemians.
You can play with the chart interactively here. The output data is also available on GitHub.
Multiple Snapshots
One improvement over the existing model, is to have multiple snapshot events, and then take aggregate (avg) results. For example, we could have 3 snapshots taken, one in the past, and 2 in the future (at unannounced dates).
By doing so, we would expand the distribution to users that join in the future, as well as incentivize people to hold Steem Power long term.
Feedback Welcome
Does this model make sense?
How can we improve it?
Do you have any ideas for alternate models?
I don't know if it makes sense but if you were to do a giveway do not use reputation as a way to determine if a user is eligible.
My reputation has been ruined thanks to berniesanders because I spoke my mind and since I am not posting much I will never get my rep back. I have always contributed positively to steemit but because I called him out one time my rep is now ruined.
Maybe it is perfect timing for you to open a "new" account, change your name, transfer all you Steem, SP and SBD out to the other account and mosey on from there... ;)
From one crypto-musketeer to another, all for one and one for all! Namaste :)
Hmm...that would also ruin my following! Berniesanders now owns me completely..my body belongs to him
LOL!!! TOO FUNNY! Thanks for the great laughter this morning. :) Namaste
Lots of good ideas here. Im all for some type of reward for those in between a certain threeshold it helps make people stay invested in the platform. Though yes probably better of we can go on based on activity amount of steem vs reputation. I think this is a great idea.
We must create incentives for holding not just based on the huge upsurge in steem price over the past few months. Saying that the economics of sbd sp and steem should ensure this anyways. This hf has been awesome and I thank the people who developed this hf to a form of platform based egalitarianism
tnx for upvote and resteem
First of all, I agree one of the stipulations should be that the account is active over the last N days/ weeks/ months.
From there, tie the distribution algorithm to the number of "unique upvotes" that an account receives from accounts above X rep that are still active (over the last Y months), multiplied by the weighted account SP (with a cap at Z SP).
Better yet, give unique votes that came from longer ago more weight (12 months ago could be weighted at 1.0, 11 months at 0.95, 10 at 0.9, etc.), so that it's harder to game it by creating new accounts to upvote oneself and also rewards people who've shown dedication to the platform.
Speaking of which, ENGAGEMENT with the platform should also be rewarded, so # of posts for the account could also be factored into the formula.
What does this all measure in the end?
The highest scoring accounts will be those that have had the most engagement with the platform, who've had the most unique accounts upvote them, and have stuck it out the longest with the platform. It's hard to game because of the "time since vote" weighting (an alternative solution is to only count votes from accounts that are N days old as a "unique vote") and the required rep (let's say something like 45, or so) to qualify as a "unique vote".
It should be obvious if an account gets hundreds of upvotes from hundreds of newly created accounts with 45+ reps (presumably from a few whale upvotes) that someone is trying to game it -- these could be flagged (either automatically or manually) and counted out of the distribution algorithm.
hi @james..like your intro about yourself "...market trader by day and party animal at night" in Nigerian cliche,we say "body no be firewood" just followed,joined recently...i need guys like you with influence ..feel free to follow back sir.
Thanks @arizonawise.
I gave you a follow and I'll make sure to check out what ya got :)
Great idea.
Reward should be every month.
So even you have few SP you know you can earn something every month by participating.
thanks for resteem.
I like the sound of this, seems like a positive step in encouraging and rewarding people on this platform. Hopefully this can be implemented!
This is actually a proven concept in the world of business called 'Endowed Progress.' It basically shows that if you give someone something for free - they will use that free inertia to go on and make a purchase that they never would have done before. Say a coffee company has those 'Buy 5-
Get 1 free stamp cards, well Marketing studies have shown that if they stamp 2 holes for your first purchase then you are 60% more likely to buy the extra 3 to fill out the card. In another instance - if a waitress brings you a small chocolate with your bill then you tend to tip her 20% more if she would not have done so. This concept is also called reciprocity - and generally mean that those given free coins will in turn pay for more in the future - and the flow of good karma continues :)
Why not create a token where there's a maximum amount of money an individual can put into it. Not sure if that'd be too tough on creators raising enough money, but it sure would help with volatility!
Because then that individual will just send crypto from multiple addresses :P
good posting
A lottery. With qualifications to enter. Leave it up to chance who gets what.
You can release the tokens like they telecast episode. Also you can create riddles and let participents win it . This would also ignite curiousity and let the best win. Just a thought.
Follow me at @honeychum