Steem Debates #2 : Burnsteem25
Thank you to everyone who contributed to the first Steem Debate about the Club system.
Now we move on to the second topic - Burnsteem25.
Is this helping to rise the price of STEEM, or is it just an unfair tax on rewards?
Burnsteem25
Burnsteem25 was introduced about two years ago by @steemcurator01.
The general idea, as with all cryptocurrencies, is that burning STEEM will help increase the price.
To use the #burnsteem25 tag you have to set a 25% beneficiary to @null - this means a quarter of the rewards are 'burnt' (destroyed).
Posts using the #burnsteem25 tag have a greater chance of attracting a bigger vote from @steemcurator01 & 02, as well as all the other steemcurator0x accounts.
The Pros
The use of the burnsteem25 tag has become very popular with large sections of the community.
Posts using the tag do appear to attract more frequent votes from @steemcurator01 & 02.
While setting the beneficiary to @null reduces post rewards by 25% it does appear generally that the larger votes given by @steemcurator01 and 02 do more than compensate for the loss.
As well as potentially attracting more frequent and larger votes from the main curators, using burnsteem25 does allow members of the community to play some small part in helping to increase the price of STEEM.
The Cons
Not everyone of course supports burnsteem25, and certainly when first introduced there was significant opposition.
People who oppose it do not like giving up part of their rewards, and do not believe it has any positive impact on the price of STEEM.
Opposers to burnsteem25 also question why the big whale accounts do not participate.
What Do You Think?
Is Burnsteem25 a good thing?
Should it be kept in its current form?
Should it be modified?
Or should it be dropped?
If #burnsteem25 went should there be some other way to burn STEEM?
What are your ideas?
Using the #burnsteem25 tag does seem to attract more frequent and larger votes from @steemcurator01/02.
But it doesn't guarantee a vote.
Many are happy to participate. Others see it as an unfair 'tax'.
The goal of burning STEEM to help increase the price is definitely a good one.
The difficulty of course is knowing what if any impact the burnsteem25 initiative actually has on the STEEM price.
There are too many variables and too many external factors to be sure either way.
The only data available comes from the burnsteem25 tracking posts that @remlaps did for some time...
Last October he reported the largest ever monthly total for burned beneficiary rewards...
To burn or not to burn that is the question.
Keep following the Steem Debates and make your views known.
Thank you
Pennsif
I've always had fairly neutral feelings towards the burnsteem initiative and as is customary to replying to questions, I shall ignore all of the questions and just share some thoughts. I'll probably think about it more in this reply to you than I ever have done so maybe I'll have a strong opinion by the end of it.
Once the initiative was launched, it was quickly pounced upon by the community. At the time of writing this sentence, there are 2,601 posts that have @null set as a beneficiary with a total reward of $11,507.18 - a minimum of 25% of this will get burned.
This c~$12,000 per week has been consistent for a while so 25% - $3,000 ~ 12,000 STEEM from a circulating supply of 463,270,794 STEEM = 0.0023% per week being burned. Tesco say that Every Little Helps and without being an expert on the matter, this feels very little - and to prove my lack of knowledge, the other 75% increases the circulating supply so this 0.0023% will trend towards 0. (This reminds me of my maths degree. As x tends towards 0....)
Like I say, I'm no expert.
Releasing the cynic in me - the majority of the community (bar a couple of exceptions who have discussed this well before it became an initiative) don't know (or care) what impact their burning has. They're not doing it "to increase STEEM price", they're doing it to attract sc01 votes. Obviously. And it makes sense for them to do so. 100% of $(tiny) is $(tiny). 75% of $(tiny) is $(slightly-tinier). 75% of $(boom-time) is $(boom-time). It's worth throwing those dice and hoping to strike lucky.
Repeating my comment in the last debate - it's another wasted hashtag that could be used to identify your content.
I could calculate what percentage of sc01 votes go to #burnsteem but that'll require effort on a subject that despite writing nearly 7 paragraphs on so far, I still feel nothing either way.
Circling back to @danmaruschak's comment regarding "the burn happen at the point of reward-granting", this could be more impactful as a larger quantity can be burned and there won't be a divide between "Users who feel like they're losing something" vs. those that aren't. By burning at point of distribution, nobody's losing and nobody's winning. The reward amount might be "reduced" due to the sum being burned but this would be evened out by the
increase"reduced-decrease" in price from the "slower increase" in token supply. I should expand on me not being an expert to state that I don't know what I'm talking about.So in summary, great. #burnitalldown although it's probably a bit pointless at its current scale.
Glad you can show us the numbers in the calculation, that tells a lot.
Burning steem to have an effect on the price requires lots of steem
As a little bit of extra information, it's now been exactly 2 days since this comment and the Circulating Supply has increased to 463,419,656 (+148,862) which equates to 521,017 per week. Rounding down to 521,000.
12,000 / 521,000 = approximately 2.3%
So currently, approximately 2.3% of newly minted crypto is burned.
This number sounds more impressive but still feels like a drop in the ocean when considering the existing coins in circulation.
I'm inclined to still conclude that it's probably not achieving much at its current scale.
Thank you for the figures.
I guess it is a case of 'little or nothing' or 'better than nothing'.
Maybe or maybe not.
I am still of the opinion that burning tokens is not a good idea. People don't toss valuable things in the trash, people throw worthless things in the trash, so why would you do that with a supposedly valuable token? It is not clear at all to me that it helps the price, there's a hand-wave-y argument that it ought to but I haven't seen much analysis that it actually does. Traders probably aren't monitoring global supply numbers, so how could the information that there are a few less tokens in the ecosystem than expected impact their behavior? Having the burn happen at the point of reward-granting isn't as bad (there's an element of the author and voters agreeing to a lower amount of inflation) but I still think we'd be better off thinking through the economics than chasing the "burn everything!" hype train.
Token burning is extremely important in any crypto system for the simple reason of the law of supply and demand. If a product is abundant, its price goes down, if a price becomes more expensive, the price tends to rise. Obviously, this is not the only factor for a token to increase in price, but it is a very important one.
Global supply is a simplified abstraction, sometimes it can make sense to think about "producers" or "consumers" as if they act collectively, but an actual economy happens in the aggregation of lots of individual transactions. "Global supply" doesn't directly impact any individual who wants to buy or sell Steem, the only thing that matters to them is whether they can find someone willing to transact with them at a price they're comfortable with. Somebody else burning Steem in private mostly has no impact on that. It is not clear at all to me that "token burning" should be considered any more important to a cypto system than dollar-burning or euro-burning are to those systems.
But that depends on what kind of "individual transactions" we mean. If there are a lot of people selling, obviously the price goes down. If there are many people buying, the price rises because the asset becomes more expensive.
The global supply is affected because if there are many holders of the token it will be very easy to find a lower price; but if you really want to buy Steem as a store of value and there are not many sellers, then obviously the price will be much higher.
And maybe that person doesn't feel "comfortable" with the price, but at the end of the day it is the price that the market dictates. In that sense, flaring plays an important role in reducing the total supply and balancing the price by sending it up. At least that's the theory, friend @danmaruschak
Trades are symmetrical. A buy only goes through if it matches with somebody else's sell on the other side. And when you're "buying" one currency with another currency that also looks similar to "selling" the second currency for the first one. There is no one "price" of a coin on the market, each transaction has a "price" that the two parties agree to. We often treat the most recent trade or some average of recent trades as "the" price but that is an abstraction, not reality. The reality is that each individual market participant has their own preferences around whether they want to acquire or trade away particular coins. There's no centralized bucket that all sells go through or all buys go through that push a quantity called "price" around. Sometimes you can think that way as a rule of thumb, but it's not the way the actual market operates.
The question is not "is global supply affected", that's backwards. You are trying to argue that global supply affects something else: the buying and selling decisions of market participants.
The price is what buyers and sellers agree to. There is no separate entity called "the market" that dictates what "the price" is, that's a simplified abstraction of aggregating lots of individual decisions.
Yes, a theory that's probably wrong.
Conventional crypto theory usually says burn = good.
Which may be the case but we have never reached anywhere near a critical burn mass to really test that theory.
Although it is not the only variable to consider, flaring would work if demand remains constant or increases.
There are very few examples of this, although we could name BNB, however, Binance does its burning every 3 months. As it does? From his profits, he buys back BNB which is sent to the Black Hole.
It should be noted that Binance BNB began burning its token in 2017, but it was not until 2021, when it burned 3,619,888 BNB, that the price began to skyrocket.
By that time, Binance burned over $165 million and will continue to do this until it has burned through half of the initial supply, which was 200 million BNB.
Burning is only one variable in the equation, however, it is curious that BTC does not have scheduled burning nor has any of this digital asset ever been burned.
In fact, I made a publication about it, and with your permission, my dear witness, I will leave the link here so you can know my appreciation.
https://steemit.com/hive-127586/@oneray/por-que-deberia-seguir-quemando-parte-mis-ganancias
Burning steem, I would like to see a calculation that makes the price of steem really go up, because I think that a lot of steem must be burned for that to happen. But I understand that some use the #burnsteem25 tag as long as it returns a profit.
To burn a lot of steem, it has to be done in a different way if it is to have any effect because no big account will give away 25% of their income.
Burn Big, Burn Bold, Burn Better...
It would be interesting test the theory with Big Burns but that really needs @danmaruschak's 'burn at the point of reward-granting'. And I can't see any likely route to make that happen as it would really need a hard fork I think.
Y aunque lo haga, eso subiría "artificialmente" el precio. La idea sería mantener quemas anuales programadas con un porcentaje muchísimo más bajo. Incluso la data suministrada por @remlaps los cuales son número objetivos para analizar y extraer conclusiones, reflejan una subida prácticamente nula del token.
Claro, quizá sea por la poca cantidad de Steem quemados. Pero aún así, el "ATH" de Steem llegó cuando la idea #burnsteem25 ni pensaba nacer. Pienso que hay que ir al problema de fondo, generar mecanismos para atraer la inversión.
Y, ojo, soy cien por ciento partidario de la quema de tokens, pero en un contexto específico y con unos porcentajes muchísimo menores.
In general, coin burning is an effective strategy in providing and managing coin value, as well as attracting interest and trust from investors and the community. I noticed this strategy is also carried out by many other cryptocurrencies such as BNB, Shiba Inu and many others.
There is serious debate because not all users are willing to use the hashtag #burnsteem25 because it can minimize profits, especially for investors. But it is acceptable from a business perspective!
However, for regular users like me, the #burnsteem25 initiative is a means for us to contribute to reducing the supply of Steem and increasing its value in the long term. Maybe the impact is not significant, but it is worth noting that burning is one of the best solutions currently available. Even if the impact is small, at least we are doing something.
I have positive confidence in the #burnsteem25 initiative until we find a better and more impactful solution. Thank You
I agree with you, as long as these burnings occur in a specific context. In my opinion, the data provided by @relamp in his post regarding the results of the Steem token burning nine months ago is revealing. Even in the month where the most tokens were burned, the price did not rise excessively. Is this making the burning unnecessary? No, but it must be done in a specific context. A much lower percentage (I suggest 1%), all accounts within the platform must burn, and only one burn on the same day, at the same time.
Maybe, but there is no current mechanism to achieve this...
Thank you for your positive view about burnsteem25.
Hola amigo, seguimos en las cosas que hay que hacer para aspirar a votos de los curadores, porque si se dice que con esta iniciativa de la quema vamos a mejorar el valor del steem, por qué las grandes cuentas no lo hacen y ni siquiera la cuenta de steemitblog para dar el ejemplo.
Cuantas cosas se propondrán para que los curadores voten nuestras publicaciones, pero aun si hacemos todo lo que se exige y los votos no están garantizados, entonces llevamos ya dos cosas para aspirar a ser votados, estar en un club y quemar steem, todo esto es mas importante que la calidad de lo que se está publicando, al final de cuentas de qué estamos llenando nuestro ecosistema llamado steemit?
Saludos amigo, te deseo éxito.
Those that have invested their own money in STEEM are unlikely to burn.
There is an obvious difference in this between investors and non-investors.
And that is where, as Cantinflas said, is the detail.
We only burn those of us who seek to remain in the good graces of the team of curators, and aspire to receive a vote that, in some way, falls into our publication.
We will hardly, not to say impossible, see an investor burn his profits. It's like I have a flower business, and to make the price of flowers increase, I burn a quarter of what I have invested in my business. Will it happen? Never, because it is not the only thing that is needed for the price of an asset to increase.
Interesting to read so many opinions on burnsteem25.
Absolutely right sir, this is a very good idea from Mr. @pennsif, we will know the problems that exist about Burnsteem25. Many also say the influence of bursteem25 is very small because big investors don't do it, and there are also those who say unfortunately there are some who do burnsteem25 still don't get support, those who don't do burnsteem25 get support, so burnsteem25 enthusiasts will decrease they think "it turns out that without us, burnsteem25 also supports a lot", at that time they will also forget about burnsteem25.
Even so, we just need to be patient and I keep doing burnsteem25 until they really don't support it anymore.
Quiero dejar mi opinión por aquí para continuar el debate de estos temas, desde el principio he apoyado #burnsteem25 porque se supone en teoría de criptografía general que: se disminuye la oferta de steem en el mercado.. aumentando su demanda
Pero tambien es cierto que, no todos usan @null para quemar, no todos los grandes inversores están dispuestos a quemar 🔥, entonces digamos que sería un porcentaje minimo en contra de muchas cuentas que usan sistemas de bots de votos para obtener beneficios.
Pero, el #burnsteem25 de cierta forma ha limitado también a que los usuarios aporten a las distintas dinámicas, por ejemplo antes eran mas los usuarios que se atrevían a dejar un porcentaje para la comunidad donde participan, ahora se ven un poco limitados por querer usar la etiqueta #burnsteem25 sin sentir que están dejando todo su trabajo en los porcentajes (siendo que reciba curación por sc0x la publicación)
De igual forma no se apoya tan amenudo proyectos como el de 'Ubongudofot' con los sistemas eléctricos que instala en las escuelas, porque los usuarios prefieren quemar
Siendo sincera, es un porcentaje que sería util para proyectos que lleven a la promoción de Steem o proyectos sociales grandes
Aun así, siempre estaré dispuesta a apoyar las iniciativas de @steemitblog porque estoy inmensamente agradecida, y creo que por ese sentimiento es que muchos usuarios se han unido a la quema de Steem
Realmente, al menos hasta donde conozco, se unen a la iniciativa de la quema, para tener la posibilidad de recibir un voto de cualquiera de los SC, y no porque entiendan la razón de fondo de la propuesta, que de pana, no funciona, no ha funcionado, ni tampoco lo hará, hasta que se cumplan otros factores que van de la mano, y que están presentes en el mercado criptográfico.
La quema per se, no hace que el precio aumente, sino que el crecimiento de las cuentas, se ralentice un 25%.
TEAM 5
The burnsteem initiative is a good one. Burning of tokens contributes to reduction in supply which affects the tokens.pricw positively.
However, having tried that mechanism, it is not working. Why? Because the number of tokens injected into the market makes the burned steem insignificant.
So I will suggest the steem devs introduce the buyback mechanism or other deflationary method of reduction for the steem token.
Burning of fees payed for transactions on the steem exchange can also help with the token reduction.
I also know that the halving method used by some chains will help a lot too. Even though this will require a hardfork.
These are my suggestions to help improve the price of the steem token generally.
It is very unfortunate that even with the pump of BTC and other coins and token, our beloved steem coin have been ranging between $0.26 and $0.34 which is not good for a serious and money-minded investor since its rate of return is not impressive at all.
If some of the measures I mentioned can be adopted, we will see an organic growth in the price of steem coin.
Thanks @pennsif for this opportunity to share my thoughts.
I don't know if it really helps the price of Steem, so I won't comment on it. But yes as a user. In Steemit there is token burning and clubs. Which affects the authors' earnings.
In a post, if you use token burning, and you must light half of it, the liquid steem you have left for your use is little.
This makes it take longer for the user to meet personal goals. Let's say you want to buy something, it takes a while.
On the other hand, I think that saving in Steem should be encouraged. That the savings section be used and that when taking them out from there people do not have to turn on half because you are in a club.
After all, people are also on steem to make a little money. I think that this would in turn encourage attracting new users, because accepting so many rules can be a bit tedious.
La sección de ahora no tiene ninguna utilidad. Se supone que si ahorras, te mantienen congelado por 3 días (si los quieres retirar de una vez) lo que metas allí, y por ende, debe producir alguna ganancia, cosa que no ocurre.
¿Ayuda a que el precio suba mandar la cuarta parte de nuestras ganancias a null?
Definitivamente no, porque esto, es solo una parte de la ecuación. Creer que, quemar parte de nuestras ganancias hará que el precio aumente, es como creer que podemos hacer una torta de cumpleaños, solo con harina.
Very interesting thoughts. There is something to think about here. We definitely need to look for consensus here.
If you don’t mind, I will publish a link to this material in our WOX channel.
https://t.me/+UThhKqfeJOZkMzEy