RE: Potential Steem Use Case: Powering a University's Endowment
Thanks for your detailed reply. To be clear, I wasn't solely criticizing your opinion, but just the general idea that Steem is some sort of magic economy that can solve all problems.
Using Steem for an endowment fund actually hasn't been discussed much and it is an interesting idea. I understand that endowment funds are non-profit. Rich people donate to them to get tax write-offs, instead of the money simply being given away, the profits are used as investments.
There are just too many issues to get past despite the risk for crypto in general. Will the government let endowments invest in crypto? Probably not in America. Is Steem even a good first one to consider? Not only is it ranked 90 and not rising, but there is too much voting to be done to perform well. I could see an endless debate over what to post, what to curate etc. Perhaps delegating all of it with clear guidelines and at a specific rate would get over this. Maybe people will pay more to borrow from a university, that's their choice.
As for things to do with Steem, that is a definite advantage. But does it need to be attached to an endowment? Educators and computer programming students can easily post or develop for Steem and even make some pocket money while they are at it. It's a great testing environment and they may even make enough money to buy snacks. However, with the price of Steem being low, this isn't the best time to advertise how much you can earn with Steem. Even the developers are second-guessing things and everyone is trying to get funded with a proposal.
Then we have the issue of corruption. Would students and alumni be compelled to use Steem? Is it right to tell students to do their assignment on Steem when the university or professors make money from this?
There are so many avenues for abuse and corruption here. It makes a professor forcing students to buy his book seem simple.
Okay, students follow all accounts on the class list. Every week you must upvote and resteem the course-tutorial post, lab-post and the lecture post and leave an insightful comment on each. Additionally, you must create your own post setting the class account and university account each as 10% beneficiaries. This is 10% of your grade with a bonus of 10%/7%/5% for the 1st/2nd/3rd best influencers. FInally, if we catch any of you downvoting or saying anything bad, you are suspended and your grades will suffer. Time to fundraise...um I mean learn.
Thanks for the reply!
Many of the points you raise could be issues with or without an endowment, and with or without Steem. I agree that there's potential for abuse there, but I'm not sure if the existence of an hypothetical endowment exacerbates most it. If Steem ever sees mass adoption, most of those risks will exist, regardless of any school endowments (in fact, they do already.).
As to Steem as a first cryptocurrency, a reason a school might want to make that choice is that the concept does not rely on an increase in Steem's price. I'm not aware of many others where the school wouldn't have to depend on the value of the token to rise. Of course, you're right pointing out that the corresponding drawback is that it's not a completely passive investment.
I want to highlight two important points from your reply that are specific to the endowment concept:
(i) Is there an inherent conflict in interest in asking unpaid students to perform support activities for a school endowment? On one hand, students are asked to perform unpaid fundraising and volunteer work for school-specific things like music, sports, and equipment all the time, but on the other hand, it's not lost on me that the @phillyhistory project wound up donating their account to a non-profit institute outside of the school when their project wrapped up in 2018. I don't know the full reasoning for that. It might help if the endowment is structured as an independent external financial entity, separated from the school by a so-called Chinese wall.
Of course, if appropriate, the school would have the option to limit support activities to paid faculty and staff.
(ii) Would regulators permit it? This is why I had the prominent disclaimer to consult legal and financial professionals. I couldn't begin to guess. I would hope so, but that could be wishful thinking.