My take on HF21
The word that best sums it up is "Wow!", so much stuff happening in one hit. We have the Steem Proposal system (SPS), which is my favourite, other successful chains such as Dash, Ethereum and Ripple have foundations and worker proposal systems, currently Steem is operating like a country without a budget and relies 100% on the private sector (Steemit Inc) and smaller app developers to build on and advertise Steem, the latter having very little resources to make a difference.
The SPS was initially to be funded by a Steemit donation, which seems to now be around 200K STEEM once off, some people recall a higher figure (6 Mil) being thrown around but I personally don't know where to reference that, which is another reason why a forum would be good to document and archive such things.
From the outset I have said that donation-based funding will not be sustainable long term and only emissions based inflation funding will always ensure a steady budget for growth. Most stakeholders and witnesses agree on this, but what they don't agree in is where the funds should come from, some stakeholders think that only author/curator rewards should be used as a funding source because that is where the largest drain on the economy is.
Others think that stakeholder interest stake should not be touched as this makes Steem a less attractive investment vehicle.
My take on this is that all sources should be taxed fairly equally to avoid finger-pointing and conspiracy theories that witnesses and stakeholders are trying to screw the authors, basically we are all in this together and should all shoulder the funding tax, the current split is 75% Rewards, 15% SP Interest, 10% Witness. My suggestion is 70% Rewards 14% SP Interest 9% Witness and 7% to the DAO.
There are a few others who support the above proposed split but seems majority are pushing for 65% Rewards and 10% DAO, with witness and interest untouched.
I understand the reasoning that if witness rewards are reduced, many backup witnesses may drop off and reduce the security of the chain, also consensus witnesses won't have the resources they need to run price feed servers and several backups and may cut corners which could be bad for chain performance and security, I personally run 4 servers in total. My suggestion is that then witness rewards be adjusted to shift more away from the top 20 consensus witnesses to the backup witnesses and I am totally fine with that.
To me taking from the SP interest inflation is fine also, psychological test...put your hand up if you even knew you were earning cira 2% APR on your staked Steem Power? Steemitwallet.com doesn't give any indication of this and I argue that the interest has any bearing on outsiders wanting to invest in Steem, because how would they know about it? I also argue that if investors want a decent APR they can just delegate on https://dlease.io where every day there is about 75K of Steem Power orders between 16 and 20% APR and would encourage more people to rent if their lease orders get filled timeously, this is the investment vehicle right there, 2% is a joke and you will get more on margin lending and on most masternodes so I don't buy that it makes a difference, maybe it stops some stakeholders from dumping more, I don't know. I personally don't even feel it and won't if it gets reduced.
(No mention at all about interest inflation in the wallet)
Regarding the Economic Improvement Proposal (EIP), I think the free downvote pool is a good idea, this will give 25% free downvotes without affecting your voting power, this means we can really clean up this place of trash and spam, I hope this can be delegated because I would rather give that responsibility to people who are more in touch with what content is considered inappropriate as my focus is on business on the Steem blockchain.
The Convergent Linear Rewards curve ... say what now? Ok I don't have a PhD in mathematics, but from what I understand this to be is that the rewards start off as sublinear, meaning that rewards are less as the first few votes come in, once the content is proven by consensus to be vote-worthy then it converges to linear as it gets more traction, linear is what we have now. I don't think this is much of an issue and is worth a try so I'll approve this.
Now for the contentious part, the shift from 75% Author/ 25% Curator rewards to 50/50! The idea behind this is to encourage more curation and less self-voting, I don't hate the idea but I really think it is too much for one Hardfork, especially since author rewards are already going to be reduced in the SPS, content is the inventory and lifeblood of the ecosystem, on one hand, paying less for content creation could mean that we get lower quality and fewer posts, however there is an argument that with improved curation, good posts may actually get voted on more and not have to buy votes from bots as much or at all.
There is another benefit, this means that 12.5% is shifted from liquid author rewards to staked curation SP rewards, basically reducing circulating supply which means less dumping! Great, the Steem price may go up a bit with reduced selling pressure, there is always a silver lining to every dark cloud.
This will encourage people working together and curating as teams rather than solo self voters and could bring about a refreshing change and new business prospects. Services like @steemvoter (Guilds and autovoting) and @dlease (Steem Power leasing) will continue to be in demand, while bot services like @minnowbooster will decline in use.
At the end of the day, radical change is needed as Steem slowly loses ground on the Coinmarketcap top 100, these changes can always be tweaked in a future HF anyway. I would have liked to have seen the SPS done first and gain good traction and community support and think the EIP might give the SPS a muted landing and the distract from its short term effectiveness and community embrace, I am also however sensitive to the fact that more HF's mean more exchange node upgrades and downtime for exchanges and potential delisting of Steem so makes sense to push it all into one from a technical perspective.
Please be assured that I will remain a faithful consensus witness on the chain and as CEO of BuildTeam will continue to strive to make Steem great again.
If you like what I do, vote for thecryptodrive witness with this vote link: https://steemit.com/~witnesses
Or use the quick SteemConnect link: https://app.steemconnect.com/sign/account-witness-vote?witness=thecryptodrive&approve=1
When is the HF set to take place?
June sometime.
thanks.
I believe the witness percentage of the inflation should be reduced to fund the SPS for one simple reason. Witnesses, and their supporters will obviously have the most influence over the direction of funds within the SPS system. When Steem price has been high, Witnesses have justified the pay on the basis that they are funding other projects and developments or supporting the community with some of the Steem received that is in excess of their costs. These projects funds should now be requested and voted on through the SPS instead. It would also be trivial to build a SPS proposal that supplements witness pay during times of low Steem value, but there will be no way to claw back the inbuilt inflation to witnesses without a Hardfork battle. If Steem price rises, node costs fall, and the SPS is used as a witness piggy bank... I just know I won't be happy about it.
The big fear for me with convergent linear is the crippling of small interactions. Like everything on Steem, number of votes doesn't matter... just stake and vests. One whale vote achieves the "consensus" that it would take many smaller users to achieve. Meanwhile, if these smaller users don't band together en masse, their votes are totally lost. Small accounts lose virtually all of their voting power unless piling on to a "popular" post. This is the exact opposite of organic curation. I think you're correct in that we'll see a resurgence of voting trails and curation guilds, but I don't see that as a good thing. That's not organic curation or good content discovery. That's just a bunch of people communally choosing one post to vote on so they can all make money together without enjoying it or even viewing it. The landscape will also look a lot more like it did under the superlinear curve. Many weren't here or don't remember, but I know that my feed was 90+% posts with zero payout and a few posts with big payouts. As I take a moment to scroll through my feed right now, every post has a payout... some are only 15 cents... but it's a payout. I also choose to spend some of my power voting on comments, usually dropping a 4 to 6 cent payout with my vote so it's above dust threshold and provides a payout. All of these micro transactions will cease under convergent linear. We are actually seeing a gradual broadening of the "middle class" and a greater diversification of stake. Convergent linear and 50/50 are going to slow this process enormously i fear.
I also see 50/50 as a negative against developing business models like Steemhunt and Oracle-D. These are businesses and initiatives that function on the premise of businesses and brands utilizing their stake to reward users for performing tasks, writing reviews, talking about their products, etc. Businesses are incentivized to acquire SP because their voting power is their marketing spend. It's already an amazing system because these brands can reward their followers and ambassadors without ever touching their original SP principal, that may in fact still grow over time with price appreciation, 25% curation rewards, etc. Under 50/50 the "marketing spend" of these projects is effectively reduced by a third. The same goes for all philanthropic curation projects that actually want to reward their vote recipients as much as possible and don't honestly care much about the curation rewards coming back.
I also foresee the large whale accounts whose voting behavior this is supposed to change being completely ambivalent. One large vote from a whale will automatically propel them to the point in the rewards curve that converges on linear, so they won't benefit nearly as much from votes following after their own. Plus, since they're voting with a ton of power, they need an equivalent amount of power coming in behind them to make the 50/50 pay off as much as just self voting themselves. This will only happen if whales collude to trade votes and pile on certain authors. No organic curation or content discovery. The only way these whales can see significant rewards under the new 50/50 convergent linear system is to break their votes up into many smaller votes... probably voting at 5% strength or less. I don't believe for one second that an account holder who currently is delegating to a bidbot, or autovoting their own spam posts and receiving completely passive rewards... is going to shift to evaluating hundreds of pieces of content daily, and delivering 200+ reasoned and authentic upvotes that assist in curation and content discovery. Traf's post wasn't heartening in this regard. A whale who is engaging in the unwanted self voting behavior, and is one of the main architects and proponents of this new EIP, could only say that he would "likely" change his behavior if it passed.
I think you make some excellent points here, no time to really comment in depth as I really SHOULD be working on something else, but very three valid and coherently made criticisms of the HF I think.
Very fair point about how it may not be beneficial for businesses, it would be interesting to hear @starkerz views on this particular point.
Although I'm ambivalent about whether killing off rewarded micro interactions is a good or bad thing - I enjoy giving out those 2-5 cent tips on comments myself, and receiving them back, but is a cheeky comment on a post by a 5-30K account (the level of SP of most of my 'Steem friends') really worth even 0.02 cents, that's 20 cents if Steem 10* like we all hope.
The short answer to that is obviously no, so maybe getting rid of rewards on those isn't such a bad thing!
I see the micro rewards as much more valid and potentially a huge draw to the platform in the future. Going forward it’s obvious that the vast majority of accounts will earn very little, regardless of what changes. Steem is just too scarce at any semblance of scale. And your average social media users account really shouldn’t be making hundreds or thousands of dollars a year for some selfies and food pictures. These casual users won’t bother to link a Steem wallet to a bank account, cash out for fiat, etc. all for the sake of $5-$10... but they will spend Steem back. That’s easy & free.
As a comic artist, I can interact with folks in my comment sections and over time they’re easily going to get a few bucks worth of upvotes from me. Then I will gladly sell them a comic for $3 worth of Steem. Through that experience, they’ll probably be a loyal fan, a promoter, and possibly reach into their fiat pocket to buy more merchandise too. Even at its base layer, without SMTs and overcomplication, Steem can be a great loyalty rewards & marketing system. That’s even how I’ve begun pitching Steem. Not as “come blog and earn money!” but as “come hang out and get a few free comics!” (Valid for my target audience of course!)
So I may be speaking selfishly out of my own use case scenario, but it’s one I see working for lots of businesses and brands. I want my vote value to go to my target, not boomerang back to me in curation. I want my lone vote to matter. An inciteful comment from a reader remarking on page 7 panel 2 of a comic isn’t going to achieve consensus or go viral, but it’s a perfect place for that one on one relationship building and value reward.
Unfortunately taking the rewards down to 65% to fund the sps will seriously affect client relationships which we have worked hard to set up. Inflation for funding the sps must be taken equally from all parties. If the witnesses don’t like it, they can leave. I know we at oracle-d will continue to be a witness regardless. Funding the sps from rewards and splitting post rewards 50/50 will affect many business models on the steem blockchain significantly, and not for the better. It will give delegators less reason to delegate since they can no longer reward as much as they could before and there fore the whole reason for delegation is gone, that reason being the ability to have a trusted third party manage your ability to influence others.
In my view the whole problem here is that you can sit and earn 15% from bots and various other schemes on Steem for doing nothing. This is truly crazy. The Idea that large holders (or anyone) is able to earn 15% pa for adding zero physical value to the chain is socialism for the rich. This 15% pa is backed by the value created by the community so in order for the Steem price to hold value the community needs to create more value than this 15% per year before it can break even. How can we possibly expect this to work? The Steem price will go up once the amount of fiat brought in through investors surpasses the value of the inflation distributed. At the moment much of this value transfers to the pockets of people who just delegate to make a passive return in exchange for not actively engaging with the network. This is unsustainable.
The true fix is here; Not anywhere else. If large stake holders are rewarded more than 5% per year for doing very little value added activity, we are finished.if it stays at 15% pa we are finished. If people don’t like it, they can leave and go find another unsustainable model to leach off where they can get their 15% for doing nothing. If they want more than 5% pa then get if from the fiat they can charge users or clients for accessing their projects or services. Large stake holders should be rewarded no more than 5% inflation from the chain and they should only get that 5% based on the value they create for the community, how successful the projects they help set up are and how they often they interact with them positively. If our hard forks do not move us towards this model, we are unsustainable, and will continue to get poor together as we give away our precious token to people who do not add value to the ecosystem.
Initially, when I heard about the 50/50 proposal I thought, hey that's a bit drastic but at the same time saw how little engagement is left on Steem so a part of me figured no harm in trying and shaking things up cause the current path is going nowhere. I did feel it was too much of a change, 65/35 or 60/40 would have been more prudent, but some feel it isn't enough to make a significant difference to user behaviour, fair enough but as I'm discussing this in public and am receiving feedback from you and others I am realising more and more that steemit.com and other frontends aren't the only game in town, there are many other business models, 50/50 kills fundraising models like fundition and many other business models like yours, so yes I agree with you but I think my voice is in the minority.
Also great to hear that you as a backup witness who has the most to lose are happy to take an inflation cut to save on the content rewards being reduced on its own.
It would be good to run 50-50 on a test net somewhere for 2 months or so and see what happens. Then make a decision based on that. Any professional team with millions of dollars of market cap on the line would run a test first before going to the real thing. (I would think that by definition, upward mobility becomes very difficult with 50/50.) it maybe that we should propose several curation models and let the community choose here. I know this might not be in ur interests, but another incentive to get people curating and encourage more organic content creation would be to penalise users who use bid bots and users who delegate to them, thereby removing enough Steem form each vote to make them uneconomic (we use bid bots all the time by the way - but this is to keep up with the Joneses) in an ideal world, promoted content should result in burned Steem, and not add a selling pressure to the Steem price by redistributing Steem to token holders who do not do anything to add value to the chain.
What ever we decide to do, I propose we test 3-5 options first. That is what any team would do in order to minimise risk to the community and obtain the most clear view. For example, we could run a 25/75 split between author and curator as well. If we could get the content sponsored externally, the best authors could earn rewards additional to Steem rewards and content consumers and whales would be incentivised to review content. This would bring back organic discovery again. But really none of us know what will happen and this puts a lot of risk on a change like this. So I would advise running several test cases for a few months and then let the community decide what it likes before deciding on one particular solution. This will also give businesses adequate time to adjust their models before the change happens. Either way, the community must get organic content discovery going again at the same time we must disincentivise larhe holders from earning rewards unless they are adding value to the chain via supporting projects or setting up large, manual curation teams to properly distribute the wealth to the highest quality content.
I don't think a testnet would be a true representation of what would happen, only a small subset of users would use the testnet and since rewards aren't real on the testnet you can't simulate real human behaviour. I have no issue if bots are no longer the flavour, we have many services, bots however do democratise visibility where anyone can purchase visibility and does not discriminate, I would hate to go back to the days where u have to kiss ass of whales and go cap in hand to try get their vote so you can get your content promoted, I think that is very humiliating.
Yes, this is also tough. One thing is for sure, these days u have to pay a whale for exposure. It just means organic content discovery has gone. There should be voting guilds with many curators and large delegations to solve this issue. But, you are right, every scenario has its down sides, it just depends on which type of down side will result in the most active whales and organic content discovery.
I said I was ambivalent! Thanks for the detailed reply - you make a very valid case for micro rewards - I hadn't really considered in that way TBH but it certainly seems like a strong argument FOR linear.
Although... this scenario isn't most people on social media and I think SMTs cld be another way of giving out loyalty rewards.
But there is still something appealing about the simplicity of linearity.
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Thanks for your thoughtful engagement, we need people like you to be party to such proposals early on and bring up concerns such us micro interactions and how the convergent linear curve threatens that. Community voices like yours aren’t heard as much as they should be which is why in a separate post I have proposed a @tokenbb forum for things like hardfork discussions rather than them happening in slack channels which are not accessible to most.
I also like the simplicity of linear as mentioned by @revisesociology and convergent will make it harder for apps to calculate returns etc that users will receive. I also agree that 50/50 kills certain business models and it is part of the proposal I don’t really like. I also agree that whales don’t have time to curate and likely won’t change their behaviour, they will just code a bot that picks up when a post is starting to get traction and then gang vote with their trail.
The problem is these reward splits are being discussed in the context of steemit.com and little thought given to the fact that the landscape has evolved and there are many other apps in the ecosystem now that use rewards in different ways and now will be disrupted and have to retool, slowing down development on new things.
I however don’t agree that witness pay should be impacted solely, witnesses need incentives to run good servers and have backup servers etc, to be on call 24/7 incase the chain halts due to a malformed json error like happened once before, witnesses were running on 3 hours or less sleep on that day and one even drove back home from hospital to attend to his servers, we also have lots of discussions on important matters such as this. Lowering pay to witnesses is the same as lowering pay to bitcoin miners, soon after no one would want to mine and process transactions. I also don’t agree that witnesses will get preference on the SPS proposals, some might but the community is bigger now and many big stakeholders and alliances exist that can sway the proposals towards their members, the PAL community for example or the Steem Business Alliance to name a few that could have strong enough membership.
Agreed on your witness counterpoints. I really wasn’t clear enough, but I agree the SPS should not fund solely from Witness pay, but that it should be a contributor in the mix, as well as SP interest, to have a much lesser impact on the rewards portion.
I’ll be interested to see how the SPS plays out exactly, but top witnesses by nature only hold their position by gathering voting support, so through their existing contact network and infrastructure alone they’ll be in a much stronger position to leverage the SPS from the outset.
I’m very interested in the forum. I did see your post and thank you for taking that initiative!
Thanks for the discussion @bryan-imhoff, I am with you 100% that the SPS should be funded from all sources, the split I proposed is fairly equal across all, basically reducing all by 10% and rounding to the nearest round number so we don't deal with decimals. If the forum goes ahead I hope to have you engaging on it.
Dear @bryan-imhoff
You nailed it!
I've been supporting number of curators by upvoting their valuable comments and right now it seem that it will not make sense any more.
Any idea when HF21 will take place?
I'm afraid I see it the very same way :(
To some degree I believe you're right. However they may simply use extra curation rewards for steem-bounty and that way promote their content and reward authors.
Yours,
Piotr
I am not sure if I am happy with this... When will it start?? Then Smartsteem has to adopt :-/
Followed - Thanks for sharing your impressions and thoughts!
I’m not really sold on that one point myself, think it will start sometime in June if it gets approved.
Is this point already 100% sure???
Isnt there something like a democratic voting on that?
Dear @thecryptodrive
Excellent take on HF21, I feel SPS will be vital in the success of Steem however on the fly after its implementation it will be that we see the results little by little.
Friend @thecryptodrive, I just voted for you as a witness. Great work that you do.
Thanks for the witness vote and for supporting my post, I really appreciate it.
i like the idea of delegated downvotes. maybe a bit of both.
Yeah it’s very practical I’m not a professional curator but wouldn’t want my downvotes to go to waste either.
You have explained it more. I don't really support that 50/50 proposal to me and also we should be mindful and concern about the witnesses. The cost they spent to run. So I also will support the witness reward remains untouched
That’s really nice of you to consider witnesses, the backup witness especially need the consideration, I don’t think many would think the way you do and be upset if only content rewards were reduced.
Great take on HF21, I feel SPS will be vital in the success of Steem @thecryptodrive
Hey old timer! ;0) I like your reasoned take on things!
Heya, look who's talking, your account is almost as old as mine hehe! I'm glad you liked my insights, don't forget to vote my witness, surprised you aren't hehe. ;)
Haha, I thought I was!! I shall investigate the matter!
loool, escalate the matter to the proper channels! :)
Hahaha, I have alerted the authorities!! :0D
They coming to put you in jail for vote fraud, ahahahaha!
Oh noes, I shall remove it!!!! :0p
Nooo u were committing fraud by not voting for me :)
Thanks for the vote my man! Boom!!! :)
I think the idea of 50/50 rewards impacting self-votes and circle jerking is delusional.
Be whale.
Have 2 accounts.
Use one to upvote the other.
Keep both sides of the spread regardless of the splits.
A circle jerking arrangement will be sightly more complicated, but it follows the same principle.
Changing the rewards split will impact the bid bots and the curation trails.
Yeah the problem with curation abuse is it is harder to detect, post abuse is easy to spot cause it goes up on trending and the author is blamed for selfvoting, with curation it's harder to point fingers and detect, and yeah they just vote with several accounts and gain the required rewards, I mean I could make a post with one account and split my stake to 10 accounts and upvote my post with it. Luckily I run a business on Steem and have no time or interest in doing such things.
I could never understand why it have to be ether 25/75 or 50/50, but not the calculated mediane of vitnesses voted parameters.
The same principle could be applied to the size of the downvote pool and in fact to just any parameter.
Yes a witness parameter or a SPS proposal would be good.
Yes, I thought that maybe witnesses don't like to be under attack of not-content content creators on day-by-day basis.
A SPS proposal looks like palatable substitute.