RE: Final Review of Steem Economic Changes
As stated previously, I'm fully in favor of these changes, but I suggest we give some time before the hardfork, for example at least one month. These are pretty major changes to the economics of the platform, so I think we need to make sure that these changes are well published on the standard cryptocurrency new sites prior to the change, and allow everyone (current holders and potential investors) an opportunity to evaluate the changes and make their investment decisions accordingly. And just as a matter of publicity, I think we should show that changes are made at a steady, measured pace except in the case of bug fixes for critical problems.
This would also give time for these changes to be fully tested on a public testnet prior to changing it on the live chain, which I think is an important first step due to the economic significance of these changes.
@blocktrades - I highly respect your opinion, although IMO - rolling the changes out as soon as possible (while still allowing sufficient time for community review) is the best option.
I think that to a large extent, the crypto community has known these changes have been coming for a while now, and most investors have already begun making adjustments since the changes were originally proposed.
The big thing though is that markets do not like uncertainty, and I think the looming cloud of the unknown effects of the change is holding back a lot of potential investors. Personally, I am not powering up much until after the changes are rolled out. I'm waiting to see what happens. I suspect a lot of other potential investors are waiting to see what happens before they make any big moves.
Hi @timcliff, it's true that at least the steemit community itself has been aware of upcoming changes, and I suppose to at least some extent it's true of the wider crypto community, but the specifics of the change have only just been published today, and IMO the exact nature of the changes is important, not just the fact that there will be changes. For me at least, the change in long term inflation on VESTS was a critical issue and the resolution to that issue was just announced. I could not have even supported the changes under the original proposal that had a permanent inflation rate of ~8% on VESTS.
I also think there's great value to be gained from publicizing these changes before making them. Announcing that something is going to happen is much more exciting than announcing a change that has already happened, IMO.
Finally, I have to disagree with you on what creates uncertainty in the mind of an investor. There is certainly some uncertainty in how the changes will play out, but I think it creates much more uncertainty in the mind of the investors if they believe that changes are made too rapidly to the blockchain, because it becomes difficult for them to anticipate the potential future value of the coin when they have no idea what is going to happen next or how soon.
Thanks for such a detailed response! All great points :)
I do agree that there is value in setting a precedent of sufficient notice before non-critical changes, as well as providing investors time to adjust/react.
I think Dan is right that there is probably a good middle ground between the two points of view.
Hello tim,
I just read this post as a new investor I was under the impression that steem still has 100% inflation why is the whitepaper not updated?
I come across posts right now that explain how steem works but it is based on old info.
Where should I have read this update as a new investor?
There have been quite a few changes since the whitepaper. You are correct, it is no longer 100%. I believe they are working on an update, but I don't have an ETA. They are pretty busy with actual development work at the moment, for their 2017 roadmap items. There isn't a great single source of info, but if you go back through the @steemitblog posts (the official Steemit, Inc. account) - it describes many of the updates.
thx for your quick answer, I will have a look.
If someone asks me why should I power up versus holding steem what would be a correct answer.
My other question is that even though Steemit is brilliant and has incredible potential, with the 13 weeks pay out of powering down, there is no protection of whales simultaneously deciding to cash out.
Right now 120k steem is being powered down every day and there will be a maximum amount of steem that can flood the system before it will implode on itself.
Leaving everyone hanging.
What protects new investors from this happening? It can't be too difficult to calculate what the max amount of steem is that the current economy reasonably can handle.
Because it is still very early days in Steemit, and due to the big imbalance of steem power, there has to be more protection in place. Why on earth they changed it to 13 weeks for the payout I don't know. I find it hard to understand how this can be good for Steemit. I figured that we would have been better off to have a variable payout rate depending on how good the economy of steemit is. If more investments come in than 13 weeks is probably good, but in periods of investments drying up versus too many people powering down 13 weeks will cause Steemit potentially to fail to grow before it reached it's potential.
Am I wrong with this scenario? Or do bonds protect us from this happening?
The main reasons to power up are the there that you described - slightly better against inflation, curation rewards, and voting influence.
The power down rate used to be 2 years, and they changed it to 13 weeks. Since the change to 13 weeks, we have gone through several 13 week cycles, so all of the major stakeholders have had the opportunity to dump 100% of their stake if they wanted.
The price was in the 8-10 cent range several months ago - everybody thought those were dark days, and many were worried that it was going to crash to zero. With the price above $1 now, it has presented a great opportunity for anyone wishing to leave to get out.
Here is a good site to tell you what the major stakeholders are doing. It will tell you which of them are currently powering down, and if so - how much. Keep in mind though, powering down doesn't necessarily mean they are going to sell. https://steemwhales.com/
That is great Tim, I will have a look.
I still think that a variable rate would make a lot of sense. First we had 2 years now it is 3 months.
It sounds a bit wishy washy to me. In the end we want to protect the system as much as possible to make sure that the whales don't cashout at once.
I agree that they had an opportunity to do this already, however the fact that this didn't happen doesn't mean it won't happen when steem is 2$ or higher.
What I am worried about is that inevitably in the possible short future there will be way to many power downs. It is inevitable, hoping this won't happen doesn't sound like a good idea.
in other words if the current economy only can deal with a max level of power down before it descents to levels where the curation system doesn't work. Why wouldn't we want to stop this from happening?
This could happen whilst it doesn't have to happen. The question also is are people happy waiting an extra month or longer if it stops steem from dropping in value due to too many power downs.
So my suggestion is If max level is reached people have to wait a little longer to power down or we can make the 3 months 4 months or longer whilst too many power down are happening in terms of what the steemit market can handle.
This way we have control over the power downs, otherwise we are just hoping for the best and I really don't think this is a good idea.
It also shows to new investors that whales and everyone involved want to make Steemit succesful.
Maybe I am missing some vital info here this right here is my main worry and I think will be on every new investors mind.
I think we can probably reach a compromise between the two positions.