HF21: SPS and EIP Explained
Hello Steemians, yesterday we announced the release of the code for Hardfork 21 so that public testing may commence. This release candidate includes the Steem Proposal System (a/k/a SteemDAO) along with a long-term funding solution, and the Economic Improvement Proposal (EIP). In this post we want to go into more detail about the code we submitted relating to these two features. These changes are quite technical, and we’re sure people will have even more questions. We invite you to include those questions in the comments section below so that we can answer them in future posts.
The SteemDAO/SPS
The SteemDAO was a concept proposed by @blocktrades to allow Steem users to publicly propose work they are willing to do in exchange for pay. Steem users can then vote on these proposals in almost the same way they vote for witnesses It uses stake-weighted votes, but voters can vote for as many proposals as they want.
Steemit paid $50k USD to @blocktrades for the development of the SteemDAO. Once approved, and after enough time has transpired so as to demonstrate the security and stability of the system (about 1-2 weeks of operation), Steemit will provide initial, one-time funding, by converting 200k STEEM to SBD which will allow the market to test this new feature.
Long-Term SteemDAO Funding
At the request of the Witnesses, we have included code in this release that would add a long term funding mechanism for the SteemDAO/SPS. If this hardfork is accepted by the Witnesses, 10% of overall inflation (pulled from the rewards pool) would be used to fund proposals made through the SteemDAO/SPS.
Decentralization & Sustainability
It is important for the long term sustainability and growth of the Steem ecosystem that there be a decentralized mechanism for incentivizing the development of projects that will add long term value to Steem. Those projects can take the form of development efforts, marketing efforts, or anything else. Steem’s Proof-of-Brain algorithm was not designed to incentivize projects with long gestation periods and which require significant upfront capital expenditures. This was why @blocktrades proposed adding the SPS/SteemDAO to Steem and why Steemit agreed to fund that development.
Funding Valuable Initiatives
While we have agreed to provide some funding to the SPS, our resources are inherently finite. That means that the SteemDAO would, by definition, be unsustainable if Steemit were the only funding mechanism. This was essentially the argument that the majority of Steem Witnesses made to us, and we agreed. @blocktrades has used their experience with previous chains and worker proposal systems to design a system that should be very good at allocating resources to projects that Steem stakeholders believe will add tremendous value to the Steem blockchain, thereby benefiting all Steem stakeholders. Think of the SteemDAO as a decentralized tanker of rocket fuel that can be used to pour fuel into high-potential projects so that they can take flight. But if the SteemDAO has no fuel in its tanks, it can’t do its job.
As far as why the funding for the SteemDAO is coming out of the Rewards Pool, that was ultimately a decision that was made by the Witnesses, and we agree that it is an acceptable solution to the problem. The Rewards Pool is not shrinking, it is being updated so that it can reward a wider variety of creators (including developers, marketing firms, influencers, etc.) so that even more value can be added to the ecosystem, which benefits everyone.
Economic Improvement Proposal
At the request of the Witnesses, we have included code in this release that would implement economic changes which alter the incentive mechanisms to be better aligned with rewarding high-quality content. Last month we publicly voiced our support for a proposal that had been presented by multiple members of the community and which aligned with certain suggestions we had made in the past relating to a convergent linear rewards curve.
Shortly after starting the conversation, the Witnesses came to a consensus in support of adding the improvements to the upcoming hardfork. For that reason we have added essentially 3 elements to the hardfork which we are referring to as the “EIP.”
- A convergent linear rewards curve
- A separate downvote mana pool
- Increasing the curation rewards to equal the author rewards
We believe that these three changes, when packaged together, will shift the behavior of Steem Power holders in a positive way. Under these changes self-voting and bidbot usage will become less profitable than curating good content. While on paper author rewards are reduced, and curation rewards increased, we believe these changes will make it easier for good content to be discovered and rewarded, simply because that type of positive curation behavior will become more profitable under the EIP.
The net effect over time will be that more rewards go to good authors. Users should also spend more time curating content rather than voting for themselves or delegating out their power to bidbots because it will be more profitable for them to do so.
Convergent Linear Rewards Curve
While we can’t know for certain how these changes will affect the system, we do know how the system is behaving now and there is consensus that the system is functioning sub-optimally. Our decision to use the constant 2e12 in the new rewards curve is based on the desire to not change the system too much (because we know that the system still functions), while trying to make modifications that reduce undesired behaviors. In other words, the 2e12 is more similar to the existing linear rewards curve than either 2e11 or 2e13. The relevant behaviors are at the ends of the curve. For the majority of the curve, the payouts are nearly identical to a linear rewards curve.
Separate Downvote Mana Pool
Under the EIP, you will be able to render a certain number of downvotes for free (i.e. without reducing your voting mana). The way this works is that the Steem blockchain protocol looks at 25% of your voting mana and calculates how many downvotes that would grant you. Under the current system, the moment you started downvoting your voting mana would go down. Under the proposed system, Steem would basically ignore those downvotes with respect to your voting mana.
Your voting mana won't diminish, which means you can use that mana to reward more content. Once you use up those downvotes, if you continue to render downvotes, those will once again consume voting mana. This is an important mechanism for regulating abusive downvoting, but by making a percentage of user’s downvotes free, this will lead to more users downvoting detrimental content.
Here are two pie charts which illustrate how Steem’s yearly inflation is distributed now, and how it will be distributed after the changes.
Before:
After:
The Witnesses
While we agree that all of the changes requested by the Witnesses represent a positive step for the Steem blockchain, it is ultimately up to them whether this hardfork is approved, and they serve at the discretion of you all: the Steem stakeholders. Steemit, Inc. and its representatives do not, and will not, leverage our stake to influence this decision. Therefore, if you feel that your Witnesses are not representing your interests then we urge you to exercise the rights granted to you by this decentralized platform to elect Witnesses that you believe will represent your interests.
That being said, with respect to Hardfork 21, we found that the Witnesses you have elected acted rationally and responsibly, working together to develop solutions and come to a consensus on changes to make Steem a better place for everyone, while setting the stage for Smart Media Tokens.
Prepare!
Don't forget, if these plans do move forward, you will soon be able to submit proposals to the Steem blockchain. So start getting them ready!
The Steemit Team
Personally, I just can't believe that none of the ten percent of the funding for the SPS is coming from the witness portion of inflation, which remains unchanged.
Even a symbolic 1 or 2 % would have gone a long way to showing that we are all in this together.
Instead, it all comes directly from content creators. When will it be understood that without content creators this platform will wither and die? Why should content creators alone bear the burden?
Note, I think the SPS is a good thing. My issue is the funding. Just in case anyone goes all 'straw man.'
The witnesses would never allow a fork to go through that reduces their precious rewards. Are you out of your mind?
The majority are leeches who contribute the bare minimum to get that big @pumpkin vote. Once they've got it, they're golden.
Shall we talk about how a single person has sole control over our witnesses? Nah...wouldn't want to bring something like that up...
Yeah, that's true. I was having a crazy moment when I suggested it. Even crazier to think that any of them would be game!!
bwahahah, u were smoking weed coin when you type it out, see my even more ludicrous enquiry/suggestion below
I've been hovering around 80 for awhile and wouldn't be bought. The only one I saw publicly against it was @yabapmatt, who, ironically now - is number 1? Not saying your logic doesn't make sense, I've been trying to help the little guy since I got here being a 'little guy' myself. I love your views, really, not just kissing ass. Just wish more people were as perceptive.
Our main issue (by our, I mean the vast majority of @thealliance community) is the 50/50 split. Is there a way the masses can really have the power here or is this place actually centralized? I know no one that is in favor of this with less than 5000 SP.
@drakos has also publically come out against it, and with a whole lot of campaigning, he just went from 21 to 20! The community is against these changes and is doing as much as it can in the face of large stakeholders who are for these changes because they primarily benefit them.
Now, I've asked this question in a dozen different places, and no one has answered.
In EIP, with the promise that "The relevant behaviors are at the ends of the curve. For the majority of the curve, the payouts are nearly identical to a linear rewards curve."
Does that mean that my $0.03 vote on your comment will still be worth $0.03 all by its lonesome there? And you'll get the penny or two which is all I can offer for your comment, but that I think you deserve? Or does it mean you'll get $0.001 cents? How much does this curve punish these teensy votes?
edit: ugh nvm, @drakos got pushed out of top 20 again. Let's see if we can get him back in there and get some more up there! Unvote the current 20 and vote for the folks against EIP! We only need 3 more (since @yabapmatt is against it, too!) We need votes worth about 160k to move him up.
1400 (mvests)500 (approx steem/mvest)0.233 (USD/steem)=$163,100
Hm.
@berniesanders agreed - its a rich-people fork ...
But the worst of all, FREE DOWNVOTES ?
its not bad enough already ? give the haters their hobby for free ?
i shouldn't have read this
Can SteemDAO/SPS be used somehow to change the decision wrt who pays for SteemDAO/SPS? And can we use it to somehow create a different system of ruling decision? Maybe a more democratic way with many more Steemians being able to vote for a change than limiting this to a few witnesses?
"Even a symbolic 1 or 2 % would have gone a long way to showing that we are all in this together."
Great point!
1% would be a 10% reduction, and 2% would be a 20% reduction. Would these be catastrophic? Perhaps not, but when the current level of witness rewards were set (as part of a previous hard fork which already cut them by 80%), that was done with a goal of maintaining a safety margin in case of realistic but pessimistic scenarios on the Steem price and operational costs. 10% or 20% reduction would be a big hit to that safety margin.
Given:
many witnesses and stakeholders, myself included, view the proposed split as the best tradeoff, despite what may seem like "unfairness" when viewed solely from the perspective of this group vs that group. Sometimes perceived "fairness" can and should take a back seat to function and good economics, particularly when you are talking about an arguably failing project which if it continues on its current trajectory is likely going to ultimately result in no one getting anything.
Finally, it may be a hard truth to hear, especially for community members and content creators such as yourself or @meesterboom who absolutely have contributed a lot, but the content reward pool by design is supposed to be an engine which drives Steem's growth, not only with literal "content" but by attracting and retaining a growing community of people who contribute meaningfully to Steem. Sure there are some who do this, but as an overall mechanism, it clearly hasn't worked and on that basis alone is a prime candidate for having a slice of its budget reallocated to better use (or at least different use with the potential for more value add).
Witnesses, by design, are supposed to securely and honestly sign blocks to maintain the integrity of the network, securely and honestly adjust blockchain parameters, and approve hard forks (which in practice includes some consultation with developers on what is included in hard fork proposals). That portion of the system has generally worked, including at low Steem prices, and most if not all of the current witnesses are doing these things well (this hasn't always been the case).
The bottom line is that witnesses are mostly (if not all) doing their job; the content reward pool has not been doing its job. Looking at this from the perspective of what is best for Steem as a whole, the reasons for the proposed adjustment to the budget ought to be pretty clear.
Different adjustments can be made in the future with the benefit of further experience.
Might I suggest we incorporate the Ferengi Rules of Acquisition to our HardFork21 code?
Thanks for taking the time to reply. Your arguments are valid and well expressed.
Honestly my biggger concern is the new voting curve which I think will severely damage my ability to reward commentors on my posts. I've spent most of my 3 years here trying to encourage engagement and incentivising real human activity.
Will changing the reward curve destroy other business models? If the problem is bots aren't there other coding solutions? If the problem is self voting are there not coding solutions to limit that activity?
I've read of others delegating their Steem Power, buying stake in Palnet and moving their activities there.
I'm keeping my eyes open, trying to learn and staying ready to make the needed moves.
The curve is an interesting question for sure. I personally believe there needs to be some curve, but not necessarily this exact one. The Steemit devs have studied things carefully and have their own presumably good reasons for proposing this particular curve. I'm pretty open minded on this particular aspect of it and will be looking to engage with both Steemit devs and the community on the matter going forward.
Not directly, since people can always move stake to different accounts, and generally tiny payouts are a huge burden on people trying to catch milkers/self-voters (who aren't always literally voting for the same account but may be voting for accounts of other friends/collaborators or sock puppets).
I'm sure your own efforts are well-indented and may well contribute a lot of value, but apart from AI (if even then) there is no way for a computer algorithm to tell the difference between your tiny votes and someone working with some friends/sock puppets to milk the pool to death by a thousand cuts, so we need to put some sort of speed bump in there.
Thanks for the raising the issue.
Thanks to you. Seems like a plunge into murky waters. I was wondering if each Dapp couldn't have their own reward algorithms similar to what Palnet.io has done.
That is one way things can work. Individual apps can have their own tokens, algorithms, and eligibility policies. For example they can easily ban anyone they want, which is one way to address some of these problems but is also much harder to do at the core level of a public blockchain.
Well, and that's the big problem. The biggest positives in the communities I'm in is that personal engagement: People reading, responding, and voting on things in comment sections they like. That's the way in which steem most resembles social media. This change is throwing the baby out with the bathwater. I'm told there are tremendous abuses of the rewards pool going on. Undoubtedly this is true. But this change has too large of an impact on the best of steem's ecosystem. This change must be struck down. I'm doing everything I can to get the witness votes needed for a different top 20, but it certainly feels like there's a wall of rich people making the decisions for us. I've invested what I can afford into steem. They happen to be richer. That doesn't make it right. They're pulling the rug out from underneath all the target demographic. You want to attract the masses? Make Steem attractive for the masses. Not for the Steem whales. Their incentive to behave well should be that they want the value of steem to go up, because they already have a lot. Changing the system so that they can acquire more steem is not going to make them behave better. They'll just have more power to come out on top while the rest of steem sinks.
Trickle down economics doesn't work. It's been demonstrated time and again that it only leads to greater wealth disparity and an overall lower standard of living. This is that.
Yes yes yes!
interestingly, in case steem price would go up to lets say 10$, all the top witnesses become multi millionaires with high monthly income that should be the incentive for any witness to be ok with some lower $ value monthly income for the work today with the low steem price. as mentioned by some others, it would been the best if everybody would have contributed to pay for SPS.
There were discussions about this. Some were in favour (most noticebly @thecryptodrive), but the majority was against it; including myself.
I can only speak for myself, but the reasoning was quite logical. The SPS is very similar to the reward-pool. It's just more fine-tuned on achieving results, instead of just having a playground for people to co-operate. So taking the cut from the reward-pool makes sense.
In contrast, witnesses are the backbone of Steem and its ecosystem; which includes Steem Engine & co. Taking from that source would possibly mean pulling the rug from underneath.
Witnesses in the TOP 20 are making roughly 9280 STEEM per month; backup-witnesses are making far less (roughly 1/4 or lower). 9280 STEEM at 0.4 USD is ~3712$. (Brutto; tax has to be subtracted) Infrastructure is roughly 400$-1000$ (or more); depending on factors like full-nodes, hivemind-nodes, etc. But this only includes hardware costs, not the costs associated with the individual(s) behind the witness. Besides the obvious requirements as in securing & monitoring nodes and reviewing code, there are many unspoken requirements from witnesses; taking part in discussions, answering questions, helping new/old members, etc etc.
Now imagine BTC would drop to 3000$ and STEEM were to stay at its current level; this would result in a 12 cent STEEM. 9280 STEEM would suddenly only be worth ~1110$ (Brutto). At that point, maintaining a witness would still be possible, but a far bigger risk-factor, as the costs of running Steem nodes are essentially only rising (MIRA is helping, but TOP 20-30 witnesses do have to run high memory nodes in order to keep replay-duration low).
Especially, as infrastructure costs are really just the fundament. And you want to have experienced witnesses that feel their time is valued, which includes adequate payment.
I'm obviously not arguing with you that a 1% cut wouldn't really matter in the great scheme of things, but then why even bother with doing that, when the logical thing to do is to reduce the reward-pool in favour for the SPS pool (as I explained above).
Just because people would have a better feeling, as in we're all in this together? That's just sugar on top. Because what if I told you, that we're already in this together?
I'm a witness and developer for sure, but I'm also a content creator. Over my 2 years here on Steem, I've produced 283 posts. That's probably not as much as really dedicated content creators, but its still something. So yeah, the reward-pool cut also effects me directly.
I appreciate your thorough reply and the work that you do as a witness.
I understand your projections of a stagnant price or a lower price for Steem. On the other hand all of this is being done with the hope of increasing the price.
I also believe that witnesses have the best chance of benefiting financially from SPS since many are building as witnesses they can also make proposals and get paid even more with SPS.
In actual fact my bigger concern is the voting curve. I've invested a lot of money in Steempower and I'm very concerned that my vote for commentors on my blog will be negated.
I don't buy votes but I do give my own posts a 100% upvote. Keep in mind that on most of my posts I give away between 5 and 10 Steem in prizes. I feel that my business model will be destroyed. Maybe I'm wrong and time will tell.
For the first time in 3 years I'm powering down in order to be flexible enough to make drastic moves if necessary.
One last thing. Too many changes all at once. The last time it was an awful hardfork, not smooth at all.
Thanks for mentioning me as a proponent to taking from the witness pool. I have been heavily negotiating for witnesses to shed 1% as you know. I do believe strongly in securing the chain but I also feel that 1% is not that much and the public relations between witnesses and the community benefits would be far greater. If we don’t it just creates an us vs them scenario and breeds witness conspiracy theories.
I don’t understand one thing, you say that if BTC drops to 3000, Steem drops to 12 cents, but when BTС grows by 2-3 times, from 5000 to 14000, Steem does not grow, it remains at the level of 30-40 cents. It looks like a game with only one goal. Why it happens?
Why not take from witness rewards and make the remaining witness rewards a proposal in the SPS system?
Why not do so with the whole rewards pool?
That was exactly my thought in the original SPS discussion.
Another alternative is that SPS proposals, if approved, can be paid directly out the same reward pool that currently pays posts and comments (making the observation that both a "proposal" and a "comment or post" are fundamentally the very same thing: making a transaction to the blockchain that says: "Please vote to pay me").
I think in both cases this is premature if only because the existing implemented, tested and ready-to-deploy code does not work that way, but also because I'm pretty sure people want more confidence in seeing SPS do something useful before more tightly integrating it into Steem. (Those with experience seeing a nearly-identical system work on Bitshares may be more confident, but not all of us have that experience.)
I know, and I hated it 🙂 ... But the more I look at the what seems like failure of the rewards pool to reward valuable contributions while the inflation pulls the price down, I’m wondering if it’s the road we are heading down.
The only way that would ever work though is if we had a front end that was good enough on it’s own to actually attract people, engage them and make them want to stay or perhaps a separate reward mechanism (Content token?).
As a social media platform we are lacking a way to encourage people to enjoy and engage and so it’s now just all about rewards. As silly as it may sound - emojis, “claps” or other “expressions”, ways that make it easy to find content and other users with same interests, resteems with ability to add comment etc would make it actually fun to interact on the platform... and maybe there wouldn’t be as much focus on an upvote.
I also agree that the SPS has to prove itself before additional funding is considered, as we really have no idea what to expect at this point.
Agree with you about emojis, etc. Also the UI is very clunky, and between that and RC costs, it discourages casual interaction and humor in the sort of way that drives reddit, twitter, etc. It needs a serious re-imagining, like maybe comments are removed from being payout items and are just comments (which would make them much cheaper). As well as emojis, etc. of course.
As for the dynamic split between SPS and the rest of the pool, I'm not sure why you hate it. Stakeholders would vote on the split one way or another, and if stakeholders aren't sold on the existing reward pool mechanism pulling its weight, sooner or later it is going to get drastically reallocated or even zeroed out by hard fork. You can't stop stakeholders from doing that, and the economics of it may become too compelling for it to not happen (if Steem doesn't die first). Giving those same stakeholders a direct vote on the matter doesn't seem all that different to me.
You should submit those feature requests on https://github.com/steemit/condenser/issues
There is a little handful of devs from the community, including me, who are working on fixing bugs, adding features to Steemit (see my recent posts).
Features that requires more effort could be funded by SPS in the future.
Why the do so with the wowl rewards pool?
I am a bot. I turn comments into owl related puns.
Interesting!
Totally, just even 1!!
@meesterboom I’m one of the few to offer to sacrifice from the witness funding to show solidarity, another very few agreed with me, I’m still pushing that agenda as you can see on my forum post https://neosteem.com/topics/thecryptodrive/tokenbb-topic-sps-inflation-funding-split-prop-1560906423422 sadly you unvoted my witness (even though im fighting for creators like you) because I got into some heated discussion with a friend of yours and said one thing to offend him whereas in the rest he was way more abusive to me.
I am glad you are still pushing that agenda, it is a credit to you.
The issue of unvoting you as a witness is a separate issue to this one.
It’s to do with the other guy who swore and slandered me way worse than the misinformed observation I voiced :)
I hold my witnesses to a high standard though.
:0D
“Let he who is without sin cast the first stone” - you never been in an argument before? You don’t think other witnesses havent? If your standards are so high why do u vote NGC, he intimidates and abuses countless ppl on the platform including women, threatened to rape one of my team members even a while back.
For the record:
https://steemit.com/steem/@nonameslefttouse/pth3gv
Hey back to what you were saying about marketing, I believe most of all the new Worker proposal projects will be MARKETINg based. I believe 1% of the steem inflation put into marketing could increase steem user base and price back to all time highs or at least $2-$4 range :D
At the current market price, it would be just under one million a year for funding. If the price raises it even more funds to get things developed with. Yes, content creators and commenters will take a hit. But because of this, our dependence on the development of the chain goes down. So say steemit goes bankrupt we can still find developers to put the changes in that we need.
This is also a very good backup plan for us, without faster forks and development steem was going to die anyway.
Yes, this is true.
My point is not against the creation of the SPS. My point is the direction of the funding being solely from content creators.
The witnesses are stakeholders too, it is only fair that all stakeholders contribute. To leave all contributions coming from just one group is far from ideal.
I will reiterate. I am for the SPS. I am not for all of the funding coming solely from content creators. When you add the other changes into the mix it exacerbates the pain that will be felt from them.
Let us not forget that highly competitive days are coming. To discourage, even slightly those that could potentially draw audience to the platform is counter intuitive.
A la fina el SPS es dinero par los testigos ellos son los creadores de todas las iniciativas d acuulación de steem .
Por eso son testigos. Crean la trampita, acumulan y después compran el voto para estar en la mesa...
Confiemos más Blocktrades que le da igual Stem queEOS. Estas Grades ideas para estabilizar la moneda Steem con un fondo especial creo que es más un pago de soporte finaciero. Las grandes ideas que tiene de ellos deben ser poque les estan pagando como asesores...... era muy bonito el cuento aquel que steem liberaria el mercado a la final hay que someterse a la mano invisible de las Crytos.
No, es no correcto
You got to remember these witnesses are also content creators. So yes they won't be taxed for securing the chain. But they will be taxed for using the stake they own. Which is used to upvote content or sale votes.
Much of the funding will come from things like vote bots and self voting whales will feel this tax, more than most of the content creators or voters. The whales who own a large amount of the stake will feel this tax more than lower users since 10% of their fee's will out shadow the normal users. So whales also being witnesses are voting yes to a tax that doesn't benefit them as much.
There is more to this, that people are overlooking.
Not all of them are content creators. In fact, some of them are conspicuous by their absence on the chain. There is far more to being invested in Steem than running a cloud instance of a witness on Privex.
The many I know of actively curate content or make posts. Yes, some don't post as much but that's because they're developing. Though some are just draining the system and i can fully agree on that.
Most of the funding is going to come from bots and whales. Since they make up a large number of funds paid out. They're taking a hit in some way which many have multiple accounts. So they will be paying their fair share in some way. And at current market cap they don't really make a lot when the price is low.
This really should be seen as an investment in the system.
The SPS is an investment into the system.
Agreed. On that, I have never disagreed.
Funding - I categorically disagree that the funding should come entirely out of the content creator portion of inflation.
Last I checked the median payout was .01 SBD. SPS will lower that reward for producing content. It's retarded to further decrease incentive to become and stay a Steem user. Retention was already at ~7.5% YOY last I checked. Reducing potential rewards will not improve retention, and will shrink the market for Steem. You might note that reducing the market depresses the price.
This tax will create capital losses, not capital gains, making an existential problem worse.
It has been determined that you are trash, therefore, you have received a negative vote.
PLEASE NOTE: If you engage with the trash above you also risk receiving a negative vote on your comment.
It has been determined that you are trash, therefore, you have received a negative vote.
PLEASE NOTE: If you engage with the trash above you also risk receiving a negative vote on your comment.
It isn't true it comes solely from content creators.
Apart from the fact that literally all rewards come from investors who are paying them (via inflation), not from people who receive them, it comes from the reward pool which pays both authors and curators (stakeholders). The latter will absorb either a 25% share or a 50% share of the SPS budget depending on whether you based it on the existing split or the post-HF21 split.
But, again, all rewards are paid by investors. Shifting around who receives them does not change that.
I think my point is quite clear. I am aware that it comes from both creators and curators.
To mince words semantically like this is merely disingenuous.
Edit, I don't mean that to sound as abrupt as it reads. I am trying to get my kids out to party :0)
Well forgive me but I do think think that it not shifting solely from creators/authors but also from curators is more than a semantic point.
Nevertheless turnabout being fair play, I do think the more important point in my reply is not about curators vs authors, but that in fact all rewards are coming from investors. Before the fork, all rewards come from investors, after the fork all rewards will still come from investors.
For investors to start spending some of that inflation budget via a proposal pool (where by the way, anyone is free to make proposals stating what they intend to do for Steem and how much they request to be paid to do it, even including for that matter, content creators) rather than continuing to spend all of it via the content pool is not changing where it comes from, it changes where (some of) it is going.
I doubt very much that there are too many investors happy with overall performance of Steem over the past few years, and the reward pool is the headline feature of Steem representing by far the largest portion of the inflation budget. If we aren't happy with how things are working, and many are understandably not, questioning whether it is doing its job, and then looking to spend some of that budget on other ways of adding value to Steem should hardly be viewed as radical.
When witness rewards were cut 80% a couple of years ago in order to focus the witness role on core blockchain maintenance and away from general project funding (with the 10% of inflation budget assigned in order to sufficiently fund that essential core blockchain role), that was done with the explanation that:
Well it has taken over two years to get here, but now were are finally at the point of doing #2.
IMO it is a completely reasonable, and even pretty modest, adjustment to make at this point. After some further experience, we can reassess.
All stakeholders will be contributing, because the funding will come from inflating stakeholders existing holdings, just as funding for everything else comes from that.
The question of allocating that inflation budget is not or should not be one of different groups each trying to grab the most they can for themselves at the expense of the others, it is or should be one of looking at how that budget can best be spent to give Steem the best chance of success.
I sincerely believe that the witness reward should not be reallocated here, not because I am a witness and am wanting the higher (or at least not lower) pay, but because witness pay already went through a process which cut it (by 80%) to the lowest possible level reasonably consistent with chain safety and security (and going forward even that assertion of safety is open to question in my view).
I also sincerely believe that the reallocation of a portion the payouts from the main content pool to a proposal pool is in the best interests of Steem. It also doesn't directly translate into a cut for content because some 'project' funding can and should move to the proposal pool, freeing up more of the main pool for content and general social uses. I for one will be looking to use some of my new downvotes against posts/comments which try to extract project-like funding from the main pool when they can and should submit their request to the proposal pool instead.
Have you ever noticed how some around here will say things like, "If these content producers were producing something of value, they could be out in the real world making money."
All that does is prove how disconnected they are from the real world. This is the real world and since so many fail to see that, they can't wrap their heads around how the arts and entertainment industry generates billions annually, in the real world. Since this platform is all the land of make belief to them, they have no problems with stepping on content producers, kicking them to curb, losing out on potentially and eventually billions of dollars, so they can scratch their heads and wonder why they can't even get a few thousand dollars pouring in, while thinking they live in a dream land.
Hopefully it's not a coma though because it would be nice if some folks around here could wake up.
If only they could wake up. If only they could see for a moment what they are creating. Or rather what they are not. As we both know if they carry on deriding content creators then they will only ever see ever diminishing returns. And then nothing. When it is too late they will try to change things up but it will be too late.
Lots of people were panicking when Dan announced Voice which in the end turned out to be a damp squib fraught with problems before it even began. There will come a competitor though, one that understands the basic paradigm and seeks novel ways to solve it.
The content creator bashers here can attempt to make it hard for them or carry on the way they are going and make it easy for them. I am not holding my breath
I don't even see how something marketed as a social media platform like Voice is a direct competitor to a content production platform like we have here. I realize some use this platform as a social media site, which is fine, whatever. What would Facebook be though if people weren't sharing content from content production platforms though? What would Youtube be if people were not sharing links on social media? Many people saw Voice as competition but social media and content production go hand in hand. Each one makes the other one better.
Bashing content here is like visiting Youtube and being angry about videos.
I think maybe because some see their own efforts and see how they run their blogs, they just assume everyone else is the same. Start running the blog like a business and act like you're stepping out on a stage with every post, and you get guys like us, and in the real world, when performed live, the seats fill up, the money pours in.
We've both entertained thousands of people since showing up here, while working under conditions that make that nearly impossible. Imagine what it would be like if the odds weren't stacked against us.
Hehe, I often say similar in that those who cannot produce content worth a damn like to run down those who can by running down everyone who does. Saying that all the content here is crap and that its ALL low quality etc. Its a porr tactic of theirs and yet sometimes it seems to work on some sheep who parrot it back blindly.
I guy walks into a bar. Tells everyone they don't know how to drink.
That made way more sense in my head.
I get it though!!!!
Yes I agree completely. Especially when some of the witness funding was said to be to help them build projects. The rewards from being a top witness far outweigh the costs, especially after MIRA, even with steem at $.40. Why we are not directing some of the inflation from them is ridiculous to me as well.
Exactly, it's ridiculous and will cause a lot of negativity
I cannot see how that will encourage new people to come here.
Witness funding was and is not intended to fund projects after it was cut 80% (I believe in HF12).
Some witnesses do get involved with projects as part of their campaign for votes, and given surplus funds under some conditions, but that's not a core part of witness rewards based on how the budget was designed.
By contrast, witness rewards were intended to support projects prior to being cut 80%. That bundling was not seen as a good approach and was a good part of the motivation for the huge 80% cut. It was always envisioned that: a) existing reward funds could be used to fund projects via voting for posts, and b) something like SPS could be implemented later to more directly fund projects without the somewhat messy process of doing it with posts. It took almost three years to get there, but better late than never.
And you think the current inflation allocation setup is the right way to go for witnesses? Their costs are fixed in USD, which means a tanking steem price could make it un-economical to run a witness node at all... which would put the entire network in jeopardy.
In this system witnesses secure the network, in a POW system the miners secure the network. Miners are not able to mine at a huge profit for long before the system corrects itself. We have no such correcting mechanism with steem...
Instead, network securers continue to get inflation regardless. Fundamentally, that doesn't sound right to me.
With the recent cost reductions to run nodes it also makes some sense for there to be revenue reductions as well and this was the perfect opportunity for that to happen.
There are no cost reductions to run witness nodes as yet. Over time the costs have simply grown, though to some extent this was expected. The MIRA version (with its associated cost reductions) isn't recommended for witnesses.
I don't think the witness reward mechanism is perfect, but if we are looking narrowly at the reward amount, I think the analysis that was done when it was reduced by 80% and set to 10% of total inflation was reasonable and hasn't changed significantly, therefore the split shouldn't change. Proposals to revamp the system in a more fundamental way can be considered. I'm open to looking at it.
Why is it not recommended? That was one of the selling points sold to us by Steemit,Inc... That this new version would help decentralize the platform as it would make running witness nodes cheaper.
I would guess it will eventually get there, but not yet. The main priority was reducing the costs of Steemit's own expensive RPC nodes, and they did that.
MIRA can reduce expenses of running a node (full RPC, seed, witness) but at the cost of a much slower replay. On my witness test node, a replay usually takes 20-22 hours without MIRA but when I enabled MIRA I gave up after 3 days of replay still not completed. For a top witness, it is critical to be able to replay as fast as possible in order to get the node back on track on events such as a HardFork where a replay is required.
MIRA will help with reducing the costs of other nodes but for witnesses nodes it's not recommended for the reason above.
Interesting. Thanks for the explanation. Was that just smoke and mirrors then from steemit,inc saying that MIRA was going to help reduce the costs for running a witness node and thus making steem more secure and more decentralized?
And by the same principle why not a thin slice off the Steem Power interest so that all beneficiaries of inflation system - fund the SPS. After all, I think I'm right in saying that 35 accounts hold over half of the Steem Power. I guess that would have been unpopular with the whales.
"When will it be understood that without content creators this platform will wither and die?"
I agree with you, but I think that it is important to mention that this platform will also wither and die without content curators, and to be honest, this platform currently lacks of real content curators.
I am on Steem since 2017.05.17, and I see that people are selfish and greedy.
Many people are writing blog posts, but only a few people cares about other people's blog posts.
Maybe HF21 (EIP) (Economic Improvement Proposal) will change this by "Increasing the curation rewards to equal the author rewards".
If this will decrease the number of bloggers (and content creators in general), and increase the number of content curators (and maybe the real, human interaction with it), then HF21 will be good for Steem.
We (the users and the community of the whole Steem blockchain) need to find a good balance between content creators and content curators, otherwise this platform will wither and die.
And I agree with you hence in my original comment I said that I agree with the changes proposed. I am all for the change to 50/50.
Something needs done and this is something. Curation is sorely lacking, whether this will truly help remains to be seen but it is something and I think that's important.
Like others have said, why not take from witness rewards and make the remaining witness rewards a proposal in the SPS system?
A fine idea! :0)
Because the system needs a stable core to function at all, and that requires that witnesses not only be paid but paid enough to always maintain stable infrastructure and contribute enough of their time to necessary 'soft' functions, but also enough so that concern of losing a witness slot is a meaningful incentive to remain a good actor (if you are doing it break-even or at a loss, who cares if you get voted out once you have messed with the chain, possibly for personal profit or paid by someone else who profits).
Without a stable functioning and secure chain you can't even conduct an SPS vote. For example, witnesses could tamper with the vote by censoring transactions, or punishing accounts which vote the "wrong" way.
A DPoS chain depends fundamentally on the competence and integrity of its witnesses Putting that at risk puts the entire system at risk.
Yes. Also, why 10%? Where did that number come from? Not just just 5%? Why not 15%? I just don't understand. Also, I agree, Witnesses should be giving up some of their funds. I think 5%, just so that we're both losing half. ;)
I would definitely like to see something coming from them. I find the fact that it all comes from the creators disrespectful of those who put the work in day in and day out.
some witnesses work harder than all the content creators combined lol steem doenst have godo content anyway it mostly sucks, mostly, we have great people but they are lost in a sea of garbage which si NORMAL its NOT ABNORMAl for a social mediasite to be FULL of trash they ALl are LOL :D But we have to actually hit a saturation point to get to the point wher ewe can actually get GOOD content rise to top liek reddit and 240 million users
just give @steemit inc tiem toi realize they MUSt sacrifice or INVEST millions of steem on NEW account creation , THEN we can onbaord millions of reddit users and BOOm we win
jajaja lomismo pense, bueno es lamisria del poder y la miseria de los gobernados d nunca onfiar en los gobernantes...es como una maldicón a voces...aunque sea 0,5 hubiera sido motivante,,,
Yes indeed, anything would have been motivating. There would be no issue if they said 0.5 but the fact they vote for everyone elses haircut is poor!
My thoughts exactly.
Cheers old dog!! As is yours too!
Witness rewards are what controls the security, if you cut witness rewards, you cut funding for a proper server infrastructure. Which means the chain might go down or worse get forked out. Which would be a distaster. I don't think it's worth to reduce chain security to show that "we are in this together"
Yeah. Right.
He is right.
I disagree that a token amount would reduce chain security. I am not talking a huge amount, anything at all would show some solidarity. Just now it smacks of arrogance against those who create content.
The most often referenced number is 1%, and I do not consider that to be a token amount, it is a 10% reduction when the starting total is only 10%. In fact I have long term concerns about the sustainability of witness funding given the declining inflation schedule, so I do think that cutting it even further is dangerous.
But really the main reasons I don't think it should be done are:
I just have to disagree. And not with any of the facts you have eloquently referenced. It is over the sourcing coming entirely from the content part. There are many and perhaps valid points you have outlined above but it just smacks of witnesses looking out for themselves.
It looks arbitrary to me and it also looks as if it was decided amongst a biased group. Of course the witnesses wouldn't vote for any kind of cut to their allocation. Were there many non witnesses in that discussion, relative to the whole I mean?
There are always options. what about the ten percent coming from the rewards pool before it is split between witnesses, content etc?
You speak on behalf of securing the chain and the witnesses themselves. I have very valid fears that anything that further discourages content creators will ultimately see the demise of the platform and not in the long term. The situation is already dire.
And I am genuinely not saying this from a worried I will lose out perspective. We need the SPS. I hope it helps us move forward but I disagree with the sourcing of that ten percent.
I can't speak for everyone. Sure it is possible there are some with that view. But, truly, you are as far as I know making this accusation with no evidence at all, and simply on the basis of how it feels to you. Is that fair?
Anyway, it is stakeholders who are in charge, not witnesses. If stakeholders think that this isn't going to improve their bottom line or just isn't the right approach, witnesses who support it can and will be voted out and we go back to the drawing board on something that stakeholders will support (or alternately perhaps do nothing at all and keep things as they are). Witnesses are really just the messengers, not the ultimate deciders. (Some, perhaps most, are of course also major stakeholders, so their views carry additional weight and authority on that basis.)
This is exactly the same as the 1% (10% cut) from witnesses already discussed.
So you think that instead of shifting 10% from the content pool, if we instead shifted 9% from the content pool and 1% from witnesses, this dire outcome would be averted? We're discussing here, an increase in the resulting content pool from 65% to 66% of total inflation. That is literally a 1.5% increase in each payout, all else (Steem price, etc.) being equal. You think that will save the (Steem) world? Consider me quite skeptical about this.
On top of all the other points I mentioned, the bottom line is that nearly all of the budget is now going to the main content pool. Shifting of any percentage from the content pool has the smallest relative effect, and has a much bigger effect elsewhere. The 1% we are quibbling over is about a 1.5% change in the content pool, and would be a 10% reduction to witness rewards. You do the math on where that makes the most difference and carries the most risk. I have already stated my view.
I understand where you are coming from emotionally and philosophically in terms of "fair" and "sharing the pain" and all that, but ultimately the substance of the argument doesn't hold up.
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Can you please bring back the charting updates towards reaching the goals of implementing communities and SMTs?
Why has communication slowed down a lot again?
When do you plan to pursue STEEM listing on exchanges?
@socky that the real question brother
Posted using Partiko Android
@socky thats the real question brother
Posted using Partiko Android
Just wanted to clarify that the downvote pool is probably better referred to as a "downvote mana pool" not really "downvote rewards pool"
There are no rewards for downvoting, it simply draws from a different mana pool, aka voting power.
Otherwise great post @steemitblog
Post updated. Thanks!
Great point. Thanks Net!
Will users be able to see how much downvote mana they have used?
My guess is that it will be added to steemd.com and other sites. Steemit.com doesn't even show how much of your regular vote mana has been used.
Regarding SPS why take away 10% of the reward pool in order to pay for things that are being built anyway? This building is being done organically and the builders are actually creating business models with outside income sources. This will take away incentive! In my worst English "if it ain't broke don't fix it!"
Let's look now at the reward curve and why I hate the proposal. As a disclaimer I must first write that I have purchased about 25,000 SP at between $1 and $3!
Why I Don't Like It:
1.) If Steemit.com wants another reward model for bloggers they can use SMT's to do it. Don't mess with your unpaid builders!
The Steem blockchain is NOT a blogging blockchain so they shouldn't base everything on that! That is NOT visionary!
2.) Those of us that have built using the current reward system are going to get penalized. I reward all commenters on my posts with an upvote of at least 3% if I can't do that my community has less incentive. What about big investors that are trying to build a communtiy and reward them. Will they still invest? Probably not.
Steem's economic model is broken. That's a fact. Otherwise, we wouldn't be losing relative market-valuation constantly. Inflation is being generated and sold on exchanges, but the buy pressure is not big enough to sustain a high market valuation.
And regarding taking from the reward-pool: the majority of it isn't being utilized effectively. The inflation should have been something that is advancing this ecosystem, but only a niche group of people are actually doing something. SPS will hopefully help to have more streamlined goals for people to be rewarded for actual work done.
this a bear market, the low of 40 cents is alot higher than the lows of 2016. For steem to work it needs investors and believers. Authors are the ones who dump steem because they are effectively working and need paying. I believe the Hardfork encourages more of an investment mindset which is crucial for the steem price and ecosystem long term. It is not broken it is a bear market and we ride it out with every other alt coin.
That's not entirely correct. We're at 4400 satoshis right now, which is far lower than when Steem was at its lowest in terms of USD valuation. Which essentially means: Steem lost a lot of value in comparison to BTC and other alt-coins which did much better (EOS for example).
I've written quite a lot of posts over the last 2 years and the only reason I'd power-down those author rewards, would be for tax purposes, but not because it's such hard work. On contrast, creating content on Steem should be fun and I'd argue that the majority creators on Steem aren't professionals in the traditional sense.
Now, while authors are of course part of the dumping problem, I agree with @whatsup that most of it was done by early stakeholders (incl. Steemit Inc.) But that's part of the game. What we need are more incentives for people to hold their Steem and buy more of it. And this is not happening with authors alone. Everyone can read/watch their content without spending a dime.
in all respect your twisting what im saying. Im not talking about satoshi im talking about dollars. The only people who are going to buy steem and hold it and take it off exchanges are curators. They now how more incentive to do so.
You said that the valuation of Steem is higher than at the all-time low. But that’s only because BTC is at 9400$+. Looking at the USD can give the image of Steem price being good, but it’s far cheaper than it has ever been.
That's correct. As long as people actually want to hold Steempower. Which is why 50/50 is so important.
i dont care, its still higher in what matters, money.
Obviously STEEM was not ranked 69th(!) at CoinMarketCap some months ago, so of course you are right, and the problem is not only a general bear market!
But I really wonder why many 'stake holders' care so much about their ROI? What does it help to get a bigger part of a cake which is getting smaller and smaller? I prefer to have a smaller part of a huge cake. :)
If I knew it would let the STEEM price increase significantly, I would accept not to earn one single STEEM from now on. :)
Why do people buy BTC? Because they want to earn as much as possible interest or because they believe the value of BTC should rise?
In my eyes a real curator loves what he is reading and will curate anyway, he doesn't care if curation rewards are 50 or 25 % (and won't just join automated trails without reading what is he upvoting).
When I upvote stuff I upvote it because I like it. I don't care when I upvote (if for example after exactly 15 minutes), and how many other users have already uptoved that post.
I intentionally seek posts from new and/or unknown authors to give them a dollar or two.
With 50 % curation rewards I can't give them the same amount in future, because then I myself will get a big part of my own upvote back (as curation) instead of being able to support the authors! Sounds ironic anyhow: then I want but cannot anymore support people ...
I don't need to earn a lot of STEEM anymore because if the price will rise, I am rich anyway, if not it also doesn't matter to have even more STEEM (then I will enjoy my BTC). :)
Less than ~10% of rewards are received by creators. @arcange publishes daily statistics that reveal the exact numbers, and my last check showed the median payout was .01 SBD (median = what most people receive), yet the average payout was ~15 times that. That is because the vast majority of rewards are paid out to 35 whales, not the rest of us. Their few posts and comments receive ~90% of payouts from the rewards pool, about a third of that from bidbots. The below chart is almost two years old, and despite repeated requests for a current updated chart, I have been unable to get one. The authors have changed, but the curve is practically unchanged.
It is not creators that impact the price of Steem, because they hardly get any of it. It is profiteers, manipulating rewards by their substantial stake weight, that extract almost all the value of the economic activity on Steem, and prevent capital gains from ever impacting the price of Steem - because that value is instead diverted to their wallets as tokens, rather than raising the price of tokens.
Check @arcange's latest post for the most recent relevant statistics.
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He said relative market valuation and he's absolutely right. In the crypto market, which as a whole has indeed been in a bear market, Steem has dropped from top 10 to top 20 to now barely holding on in the top 70 (!). Some of that is due to promising new projects which took their spots in the high ranks, but mostly it is due to being much lower than projects which Steem used to considerably out-rank.
Blaming Steem's relative performance on the bear market is way off base. This is mostly on us.
dude, every single altcoin is in the gutter. Every single one except BNB and litecoin. He is not right, he is twisting my words to suit his own argument. I said steem is higher now and holding on to 40 cents which is way above the 0.03 cents of the lows in 2016. Thats all the matters nothing else, when Bitcoin tops 20k Steem will scream back up to 3 and 4 dollars. People dont understand crypto, fundamentals have got nothing to do with it. Its all relative, when one coin makes a run for it and hits a crazy price everyone says well if that xyzzy coin can be that much then every other worthless coin can be worth more too. That all feeds into itself and the casino and hype becomes alive again. I laugh when people talk about marketing and this and that, its a joke. Nobody uses this stuff yet its not happening like we thought it would its all speculation, all of it, fuelled by hot money coming out of nowhere. Slagging off steem and people saying its doomed does not help though i agree but it makes no real difference, because when it all kicks off again steem will be the best thing since sliced bread until the bear market attacks again.
Yeah and at least 50 of them have STILL managed to outperform Steem.
Stop making excuses.
Most of the Authors can not hurt the price. The dumping comes from above.
Much of the stake is not being allocated to create value at all. It is a difference in opinion on what brings value.
The eyes of the community cannot support all of the dumping, but it is mathmatically impossible for the dumping to come from most authors. The witnesses also sell to pay expenses.
Although I am not a fan of how they are approaching this, I do hope it teaches people why it is important to fight abuse. We can't change SteemIt Inc's selling, but do we have to support self voting, bot abuse etc? If people learn to downvote maybe not.
By the way I agree the funding of the SPS should have come out equally, it does need to be funded.
Agree and disagree. Yes "most authors" purely counting numbers can't hurt the price because their earnings are tiny. But the reward pool in the aggregate is responsible for a large portion of the selling pressure, in that it totals about 17 million STEEM per year, far more than what even Steemit is selling (about 9.6 million per year).
Not 100% of the reward pool is sold immediately but a very significant piece is, and of that which isn't sold immediately, a lot of that ends up being sold somewhat later anyway.
17 million STEEM/y is important, it is a big challenge to find enough investors to float that selling, and we need to be very careful to make sure it is used effectively.
You are under the assumption that the stakeholders and witnesses are better at directing it at places that add value. Based on the distribution and the last 3 years, I disagree.
It is not the tiny users that have run down the price and run end users off. They just don't have the power or the stake.
You and I both remember the original distribution. Any changes in that are a result of large stakeholder selling and small accounts buying or holding.
My view is that the mechanism which has been used for that for the last 3 years has been severely flawed and these new mechanisms are much better, especially the SPS mechanism which apparently (I say because I have no personal experience but I believe those who claim it) has a track record of working well on Bitshares.
IMO with the exception of Steemit nearly all large stakeholders selling from the original distribution has long since occurred. What is left of the original distribution, people have mostly decided to keep long term (there may always be exceptions and people may always change their minds, but it isn't a constant flow of selling). And remember, in the original distribution Steemit had 80% and everyone else shared 20%.
But numerically the inflation paid out to content rewards matters a lot. It is more than the rate at which Steemit is selling, most probably higher than the net rate at which all whales, Steemit included, are selling
To be clear, this does not mean content rewards going to minnows. Most of it goes out at the top. But we also can't micromanage where it goes. Maybe with better mechanisms we can have some chance of managing it at effectively all.
Inflation being sold is irrelevant compared to steemit inc selling rate, isn't it?
Mostly yes. But instead of working to create revenue to solve the problem we seem to be trying to plug a leaky damn by putting our finger in the holes.
Imagine if steemit.com structured things in order to bring in tons of new users which in turn would boost their ad revenue, instead of making it even harder to on board new users, which will ultimately reduce their ad income and likely spell their demise.
Hell no. Author rewards (not all of inflation but the biggest single piece) are currently about 17 million STEEM per year and Steemit sells 9.6 million. Not all of author rewards are sold (nor other components of inflation) but you can be damn sure that a lot of it is. It is very, very wrong to dismiss inflation and rewards as a source of selling pressure.
Okay thanks for putting things into perspective. I had no idea how much STEEM steemit inc were selling.
I guess we still have a few years to get STEEM on the cheap while inflation is high, and then the price won't go down as much.
That is certainly one way to look at it. And in addition to Steemit eventually slowing and/or stopping their selling, the baseline inflation declines by 1/2% per year. So yes, over time, the amount of available new Steem will decline a lot.
You are why Steem's economy is broken, and are the best example of that malfunction. You extract it's value for your personal profit before the economic activity and infrastructure can produce capital gains.
Less than ~10% of the rewards are reaching the intended destination of rewards: content creators. Almost all rewards are being extracted by manipulative financial mechanisms, and end up in the wallets of whales. You are the niche group 'doing something', and the something you are doing is preventing capital gains. The whales are cutting their own throats by concentrating all the value of the economy into their wallets, each to the maximum degree possible. EIP is a set of mechanisms to increase the rate of extraction of value before it creates capital gains. Halving author's share of rewards and instead delivering twice as much to those extracting it with the weight of their stakes, increasing the exponential power of stake with the modified rewards curve, and availing free flags to flaggots censoring creators that returns rewards the community sought to provide them as incentive to the rewards pool, where you can extract it instead, all increase the rate of extraction of rewards by stake weighting, and suppress capital gains.
You and your ilk are doing so because you can simply move on to the next victim once you've drained the host economy of the stake you extract. Steem will be a corpse, drained dry by your parasitization, left to blow away in the winds of avarice, leaving the gems that could have instead have been nurtured by substantial stakeholders to create capital gains for all investors; censorship resistance (in a world more silenced every day); one of the best blockchains ever written; a currency model that made transaction fees obsolete and proved microtransactions not only viable, but scalable both globally and fiscally, and a social media use case that could have leapfrogged every business model extant - had you only been willing to rely on capital gains for your ROI.
Should Steem somehow remain viable after you profiteers have moved on, perhaps the remaining users will be able to implement sound policies that encourage investing for capital gains, and then be able to grow instead of feed parasites.
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Exactly. When did we even have a debate or when was a case even made where agreement has been reached on the need for SPS? What is SPS supposed to do for the ecosystem to make it worth 10% indefinite spending rate?
How do we stop or reverse course if we find SPS is not somehow profitable or growing the ecosystem? If Steem were a company or a government how would we justify this to shareholders or to voters?
@blocktrades is certainly the subject matter expert on this, and I believe he's published a number of posts explaining the careful design of the system. The discussion was had amongst the Witnesses who are the ultimate arbiters of these decisions. Those are the people stakeholders voted for.
What the SPS is supposed to do is fund projects that create sufficient value to justify the expenditure, and that's the analysis people should perform when determining whether to vote on a proposal. If there are no good proposals, then people shouldn't vote on any proposals, and that money will go unspent. That's how you roll back the SPS, if it doesn't generate any value, don't use it or downvote proposals you don't like.
Is 'none of the above' an option?
Yes, there are two ways to vote "none of the above" in SPS. One is a return worker which returns the funding back to the SPS treasury to be used later and another is a burn worker which sends the SPS funds to @null.
Well, at least it has that going for it,...
Not liking the level of the toll gate, either.
How do we get to it?
It get its own tab?
I know that a basic web UI to view proposals and vote for them was completed along with the blockchain code but I do not know where that will be placed on steemit.com
The question is how will we track and measure how much value a funded project is provided? The question of "is it worth the amount of funding it is receiving?" is a question the community is likely to ask. If a project somehow drives some sort of revenue so that the value/price of Steem starts to go up then of course we can all agree this is good.
But I am concerned we could end up with a lot of low value "projects" which developers and insiders like but which does not measurably drive according to any traced metrics. So if we are talking about increasing active users, or increasing investor interest in holding powering up, or something measurable like this then great.
Are there any current ideas that @blocktrades has in mind to be on the initial proposal list?
There are blockchain history elements generated for all payouts, just as there are for content payouts today. UIs like the many we have for existing Steem functions will process this history show the data. We know who are the largest earners on author payouts, curation, who is powering up and powering down, etc. because of the many UIs and reports that have been created by the community to show this kind of data.
The initial version includes a pretty limited web UI that shows proposals and allows for voting on them but I have no doubt that over time many additional UIs will be created to show the data in more and different ways (some may even have their funding provided by SPS, some may not)
What I meant to express but did not word very well is will the UI allow for us to track the metrics of projects so we can determine the success or failure based on how much a certain project is contributing to success measures?
If it's retention stats, or if it's the Steem price, or if it is something else, I think every project which is asking for funding should have a business plan with a profit motive. The project can be a great idea but then how does it increase the price of Steem or bring in more users or make current users more active?
Example, a game in the style of DrugWars for example could bring in new users and increase the value of Steem too if it were designed the right way. The project could be funded via SPS and then every month report their success metrics such as how many users they are gaining each month, how much retention they have, this and we can look at if the price of Steem is going up or if people are powering up more etc.
So yes, we can find a way to measure "profit". We just have to agree on which measures should represent profit.
Long term, I think the most important metric should be increase in the value of Steem tokens, but it's not always going to be easy to match that to work that is done, of course.
So I agree that other metrics will be useful for measuring proposals, and there's not going to be one or even a few metrics that will be useful for the wide variety of potential proposals. Marketing proposals could be the easiest to measure, IF they can show successful adoption by new users (especially if the users are retained over time).
The impact of new infrastructural features gets more difficult to measure, and I doubt any single metric is going to work for such things. Personally, my original vote is going to be based on how useful I think such a feature is (coupled with the price asked/etc) and my continued vote is going to depend on how well the task is being executed over time.
Can you elaborate on the dynamics of the system a bit? I mostly see it being compared to witness style voting but I know that isn’t quite accurate. How exactly is the threshold set of vests needed to fund a proposal? Can proposals be downvoted or are they an upvote only system like witnesses?
Of course there will be funding for low value projects with the usual source of beneficiaries at the top who say we need to alter rewards to stop the vote bots that many of them profit from. Right now its campaign time promising the moon, then once in place what will be will be.
It seems only you have ever heard of kickbacks. Sadly, they are how government is run, and taxes create governments.
SPS sounds like a perfect mechanism to tax from the smallest stakeholders a flow of funds to a group of cronies with enough stake to ram through their proposals. We will see what happens when we allow a group of 35 rapine profiteers that have already managed to extract ~90% of the inflation from the rewards pool to vote themselves another 10% of the rewards.
I think we both know what we'll see.
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I've certainly had ideas at the past and no doubt in the future for things to propose, but the real idea behind the SPS is to have an open system where many people can suggest ideas and provide a mechanism for stakeholders to vote on those ideas, so it's not so much about my own ideas.
Making sure that we choose wisely what to upvote is of course a key ingredient for the success of the SPS as a work allocation system. I don't know of any way to guarantee such a thing (if I did, I suppose I would be the wealthiest guy on the planet). But I think it is critical that we have such a system to increase the rate at which we grow the Steem ecosystem. From my point of view, progress has been much too slow in the past and we need to expand the available pool of people that can help out. No doubt there will be proposals that fail or don't provide benefit, and voters will just have to learn to make wiser decisions in such cases.
What are some specific examples of proposals that will be introduced through this system?
I have no idea if it would get funded or not but let's say we wanted to hire a professional Marketing firm. I could get a quote, write up what costs and benefits would be involved and see what the response is.
Thanks for the reply. I assume some of the parties advocating this system have already considered certain proposals, otherwise there wouldn't be impetus to move forward with this, so I was wondering what some of those specific plans are floating around in the private communication channels that are used to determine the fate of the rest of us.
You guys really need to work on your process and outreach.
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Thanks for the feedback!
Those with substantial stakes are inveterate profiteers, and were convincing in their assurances that they wouldn't fund development with that stake. Since the vast majority of stake is in the wallets of 35 whales, and they won't part with any of it, the only funding source left was a tax on creators, whose current share of rewards is less than ~10%.
~90% of the stake in Steem therefore will not be funding SPS, and those costs have been foisted on creators as a regressive tax - a tax on those least able to bear it. Retention last I checked was ~7.5% YOY. The median payout was .01 SBD. This tax is going to fall hardest on folks making about $.01 for their content now, and not staying here very long to be taxed already. Bye bye market for Steem. Without users the value of Steem will plummet.
The current proposal for SPS delivers 10% of inflation - the rewards pool - to fund SPS. It is completely delusional to claim that 10% of stake on Steem will ever vote to exercise control of such a mechanism rationally. There is no example of such coherent voting in Steem's history, and just because it's theoretically possible for such a thing to happen is no reason to expect it to. After all, we could all just quit arguing and fighting and world peace would break out today. It won't, and only fools will expect it to.
I have repeatedly called for prudent preparations to be made to reverse HF21 in the event my dire predictions are fulfilled. Please exercise that prudence by enabling a rapid reversal of the HF should price plummet, users hemmorhage, and market cap decline. Failing to prepare is preparing to fail.
Don't let profiteers suck the last bit of value from Steem before abandoning it's empty husk.
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Just to be clear things are being paid for by steemit. We can't expect them to make every fork and pay for them. This new system would allow us to lower our dependence on any one organization.
This is a backup plan for steem, if steemit goes bankrupt we need a way to fund development not saying they will but we need to have a plan for any eventuality. This will also allow us to come up with better features for these content creators. Development doesn't fund itself, we as a community should take the hit to guarantee the longevity of the chain.
We as a community can voluntarily decide to vote for and fund proposals as we see fit. SPS being funded as a tax on the ~10% of rewards shared by content creators whose median payout is .01 SBD is undeniably regressive.
I cannot imagine a set of proposals better designed to reduce Steem's dismal retention rate of ~7.5% YOY further. Every aspect of EIP and the SPS funding proposal is going to increase the flow of the economic activity on Steem into the wallets of the most substantial stakeholders before it can raise the price of Steem, and decrease the distribution of Steem to that demographic creating all the value of Steem by creating content.
If you want to cause the price of Steem to plummet, market cap to decline further, and to reduce the number of people creating content, I can't think of better ways to do that.
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And for the 'normies' like me: https://steemit.com/normietalk/@justineh/normie-talk-hf21-explained-sps-eip-what-it-is-and-what-happens-next
Very good post, much better than this one here. I think you explained the potential value of SPS. My concern remains though how do you distinguish between an idea which is likely to be profitable for the ecosystem and an idea which merely receives a lot of votes but which is a "bridge to no where".
How are the votes going to be calculated first of all? Do whale accounts get to rig the vote? Can whale accounts somehow be excluded? Do verified accounts get to vote exclusively or do accounts of a certain age get higher weight in the vote? If it's stake weighted alone then I think you can see what can happen here.
It's going to take a lot of discipline, planning, discussion, on how to rank/rate ideas. My suggestion is we need a way to try and determine how much value or profit an idea can generate for the ecosystem. Such as does it have potential to increase the value of the Steem token?
If two ideas accomplish the same thing equally but one of them burns Steem tokens and another does not then do we prefer the one which burns tokens?
If two ideas accomplish the same goal but one of them does so in a way which can bring in lots of revenue or investors then should we favor that one?
What metrics do we track to determine the success or failure?
Well this is @justineh's work, I can't take any credit but thought it was worth linking as they appeared at almost the same time.
Personally, I believe we are already on that bridge to nowhere and so almost anything should be an improvement.
There are a lot of 'ifs' though. If bot-boosted shit content is downvoted, perhaps stake will come out of the bots to curate as there will be less profit there, and a greater % of inflation heads towards curators.
Umm, same as before?
Potentially?
Not in this proposal, and likely never.
Nope.
I see some of these changes as much larger/more radical than what is being proposed - something for palnet-type efforts/SMT's to test?
SMTs could fix this I think if we can distinguish using SMT holding how verified an account is by percentage or points or something like that.
The concern I have is what would stop whales from simply rigging the votes and then voting for their pet projects without regard for the revenue it generates for the ecosystem?
If you look for example at corruption in certain industries historically such as construction for example? We know how a construction project can end up costing way more than it should and take way longer than it needs to take etc. When people start voting directly on how to spend money it also is historically known to create infighting, even civil wars happen over these sorts of disputes.
I wish more thought could go into the on-chain governance aspect so that we can really know it's what the community wants and that all factions of the ecosystem are equally represented. Example, content producers are a faction, witnesses are a faction, developers are a faction, and different politics are emerging right now favoring one or another faction.
Sounds like a job for Oracles
https://steemit.com/ned/@steemitblog/ned-scott-and-theoretical-of-steemit-explore-oracles-on-steem
Ah OK, your previous comments and this one I think relate more to SteemDAO - I didn't catch this initially.
I think the voting here is planned to be stake-weighted, but I could be wrong. I live in hope that those with the largest stakes would wish to grow the value of their holding by voting for the projects they think have the best chance of taking Steem forward in the medium/long term.
See palnet.io for a first glimpse of this. The whales there have been made so on the premise that they wont self-vote and cannot powerdown for a year. And a high stake account 'nopal4u' sits at the top of the rich-list ready to govern.
Pal is interesting. I assume Pal is an SMT right? Doing this with an SMT makes sense but I think the people proposing Steem DAO would have had better success in promoting their plan if they actually showed that there are some good ideas waiting to be funded, some whitepapers, business plans, etc.
You also have hoped that those with substantial stakes would actually curate, instead of extracting ~90% of rewards into their own wallets via manipulating rewards with those stakes. How'd that work out?
Hope springs eternal, and a sucker is born every minute. Human traits are predictable, and every part of EIP is designed to increase the profitability of profiteering, and that is also a feature of this funding mechanism for the SPS.
It isn't particularly hard to design mechanisms that prevent profiteering, and instead enable investors to rely on capital gains for ROI. Capital gains have encouraged investment for thousands of years. Profits have also been possible from hostile takeovers that extract the value of businesses while eliminating capital gains. Selling the means of production of a company whose stock is cheap enough can create profits. It destroys the value of the company stock though, as well as the company.
The means of production of Steem is creators, who cannot be sold. Their product can be profited from by the various mechanisms enabling stake to extract the rewards creators make possible, though, and we see that ~90% of rewards are extracted that way today. Now taxing that last ~10% of rewards can increase the extraction of rewards before they can create capital gains.
Guess what's going to happen? Well, you don't have to guess. You can simply predict that the same people are going to do the same thing for the same reasons that they have been doing, only they're now going to be able to get more rewards for doing it.
There's no point in hoping some words will change human nature. Reasonably preventing extraction of the economic value of content creation before it can increase the value of Steem is easily doable, and investors - not profiteers - have been provably investing for capital gains since prehistory.
HF21 is not going to change human nature, but is intended to enable the profiteers to extract even more profit. There are no experienced investors on Steem today, because capital gains are prevented. All substantial stakeholders have been, are now, and will continue to act as they always have, and parasitically extract every satoshi of value from the rewards pool before their competitors can. They have the voting power to effect what they want to see, and this is what they want.
I won't have hope until they've sucked every bit of value they profitably can out of Steem, and leave to parasitize their next target. Then maybe we can implement rational mechanisms to create capital gains and attract investors.
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Nothing. This is the kickback generator every corrupt bureaucrat dreams of.
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You must be young. I'm pretty old, and experience has taught me that things can always get worse. Indeed, without extreme measures, things going badly are very hard to keep from going worse. EIP and the SPS funding mechanism aren't radical changes to stake weighting manipulations. All they do is increase the profitability of manipulating rewards mechanism via substantial stake to extract rewards before that value can raise the price of Steem and create capital gains.
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And if the security and stability fail what will happen then? Will the SBD be reconverted to Steem, or just thrown away?
And if the Security and stability do not pan out will this be immediately HardForked out or will the funds be diverted to something else?
Steemit agreed, as has been pointed out over and over and over again when ever Steem and Steemit are bought up it is that they are different and not the same entity. Did Busy.org, partiko, eSteem, and the others agree to fund blocktrades? The witnesses protect the Blockchain Steem,that means all users of the blockchain, and all organizations on the blockchain come under their umbrella of protection. That includes busy.org, partiko, eSteem, and other forms and methods of accessing steem blockchain, not just steemit.
This is a lot in one post, so since it is an explanation post can you elaborate on what will happen to SPS if blocktrades is unable to provide the needed security and stability?
Probably there is some misunderstanding about what they were refering to by security/stability here. It's not about any service that we provide. I think they are just referring to the possibility that there is some bug in the SPS code. It's been tested by us (and reviewed by Steemit Inc as well) and I have no expectation that there will be any security bug of significance. But if such a bug was found, it would just be a matter of fixing it. I think all they mean is that they don't want to have it handle too much funds until it's proven safe by usage in the real world.
Yes, that is exactly right. Thanks @blocktrades for clarifying that
It will be rolled back, anytime anything doesn't work it can be rolled back, forked out or a fix will be made as soon as the issue is discovered.
And when has any HF that produced horrible unexpected consequences been rolled back? Not in the two years I've been here, IIRC. Without intentional preparation to do exactly that if things turn out poorly, I don't expect such a rollback to occur.
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Steemit and other substantial stakeholders mined Steem prior to Steemit being public. They remain the holders of the vast majority of Steem today. Busy, Partiko, eSteem, and other front ends did not participate in the ninjamine, and therefore do not have that 'free' stake to invest, as does Steemit.
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Will rewards drop to 0 again immediately after the hard fork? If so, how long is it expected to take to get back to equilibrium? Any other sorts of quirks expected during the transition period?
I hope the top witnesses remember the lessons about code audits, testing, and contingency plans from HF20. We are counting on them to maintain stability for this blockchain.
This will be a good time for the rest of us to compare our witness votes against results.
That should not happen, but I will triple check that and reply back here if I'm wrong.
@steemitblog,
Yeah I think this graphical description of upcoming changes probably work well!
But I still doubt how that Downvote mana thing works, coz this can leads to more issues and people might rage quit by whales who misuse this power!
So I call drama for that content!
!dramatoken
Cheers~
Your chart is very broken. About a third of rewards go to bidbots. A lot of circle jerks and self votes are being cast too. An honest chart would represent those rewards flows. About ~10% of rewards goes to creators.
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We should be able to downvote content anonymously, is it technically possible to hide/mask these transactions on blockchain?
That creates chaos friend. What if you are targeted by a whale and you never knew who downvoting you !? At least now you can raise a issue if some one constantly downvoting as we get to know who doing this.
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