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.
I don't agree with this robbing Peter to pay Paul method of "long term funding". It puts one faction of the community against another similar to what we see in typical bureaucracies. In essence for the blogger it's going to be perceived as an immoral tax.
A better way to fund something like this would be to provide a real useful promotion mechanism where bloggers can pay for visibility and use that to fund SteemDAO. In essence instead of BidBots why not use on-chain marketing to fund something like this?
This way actual activity and usage correlates with long term funding. Otherwise you're not likely to get anything which increases activity if the SteemDAO is funded no matter what by default. Also just like with political regimes once you start paying people in this way it's going to become increasingly more and more difficult to remove (lower the tax) in the future.
Once the SPS is in production you can propose whatever changes you like to the Steem stakeholders who can then fund the development of those features. Until then, we have to use our judgement, and the communications we have with the Witnesses, to guide the code we develop. If you don't feel we are making the right decisions, then that's a perfectly good reason to support the SPS. Until there is a decentralized mechanism for funding Steem blockchain development, you're stuck with us :)
That’s a good point even though we have to move forward. We come to the decision where we need to fund this blockchain through SPS. It is a start.
Keep on postin
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~90% of rewards going to 35 whales out of tens of thousands of accounts is not decentralized.
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Well put and I agree!
I just want better alignment of incentives. Who came up with the incentive mechanics/mechanism design here? What are we trying to accomplish with the rewards (and punishments)?
Of course we need more code, but code should be generated to make a profit for everyone combined. What exactly will SPS produce which is so important that it needs 10% of the reward pool indefinitely? Is it going to produce a lot of profit and raise the price of Steem for everyone so that it's measurably beneficial or is it just moving numbers and percentages around to benefit a few who want development contracts?
It was copied from Bitshares where I'm told there is a track record of it working reasonably well.
The issue is no one knows what it will produce. The community will be able to submit these proposals. So its the communities projects we would be funding which people will need to see what value they feel it will bring to the chain.
You're ignoring his point. The funding for the SPS proposals is coming only from content creators, who currently share ~10% of rewards now. ~90% of the benefits of any SPS proposals are then delivered to non-creators - who didn't pay anything to fund them under this proposal.
That's his point. The funding is extracted from content creators whose median payout is .01 SBD now, and a 10% tax on creators is going to reduce that, leaving even less incentive to create content.
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Oops. I think the SP of the majority of stake doesn't agree with you on this. Those 35 whales seem to prefer code that profits them instead of everyone. That's why this is the code being proposed by their chosen witnesses. When you look at things from the perspective of the history of Steem, that's clearly been the impetus behind extant code. Looking forward, it's reasonable to predict that's what this code is intended to do.
Less rewards for creators, and more rewards for whales. It's that simple.
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I can think of one reason to implement a regressive tax on the ~10% of rewards not currently extracted by substantial stakeholders. Only one, and it isn't to fairly distribute the expense of funding development to those that will benefit from it. Whales currently extract ~90% of rewards, despite creating almost none of the content those rewards are supposed to encourage creating. This tax will be extracting yet more rewards from creators and enabling whales to vote to fund SPS proposals that will provide kickbacks, just like governments do today across the world.
That's the only reason for this particular funding mechanism I can grasp.
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