RE: [Steem] The Reward Pool and the Parable of the Token

I wouldn't exclude myself from the poking kids. In fact, your short interlude was quite eye opening. Thanks :-)

I leave it to individuals to classify themselves. I just make the rules.

(Go with what you're good at, I say.)

In the latter, some people do not hesitate to wage war or slaughter other folks just to get some of the tokens. Here you rather have to convince others to like your stuff so that they spend other people's money (!) on it. I mean, since the reward pool is basically a weird way of taxation, everybody kind of plays government and it kinda works

You – haven't been paying attention, right? When I refer to things like the Whale Wars, I'm not being metaphorical.

There is a literal war being waged on the Steemit platform. There are armies of mixed automatons and humans who believe in an ideology waging an all out combat behind the scenes. There is bloody fallout. There are innocents caught in the crossfire. There are passionate speeches on both sides. There are dupes, and there are fools.

You've probably heard the names of some of those involved. Bernie Sanders. Haejin. Grumpycat (but I repeat myself).

They are actively and aggressively going after each other and a number of other large players in the space, slashing and burning as best they can. Not the visceral red of blood, but by raising the bloody red flag. They are literally going after one another's incomes by flagging each other to death. Or rather, each of the major factions has so much SP spread over so many accounts that they are really just making a bloody mass and wasting everyone's time, and accidentally/intentionally catching only peripherally involved people in the crossfire and downloading them to oblivion.

War gets waged. This is the Age of Warlords. Just as war is politics by other means, so too is war economics by other means. And vice versa.

I mean, since the reward pool is basically a weird way of taxation, everybody kind of plays government and it kinda works.

You have it backwards. The reward pool is inflation. Taxation, as my people are fond of saying, is theft. Taxation is the coerced activity of trading the sweat of your brow for the reassurance that you won't be hurt. No one compels activity on the Steemit blockchain (outside of flagging, which is an entirely different nightmare).

The reward pool is conjured numbers, a deliberate choice to inflate the pool of tokens and, in actual fact, decrease the value of the pool of tokens as a whole. As more tokens enter circulation, overall value decreases. Individual tokens decrease in individual value.

Note that on the steem blockchain, part of those tokens are distributed by proof of stake, not proof of work. It is the literal definition of "the rich get richer." The rest are distributed by the mechanism I roughly outlined as a percentage of the pool allocated by votes.

I did say the truth is more complicated than the parable. Thus the nature of parables.

At this point, no one plays government. And one could argue that it doesn't actually work. Sure, some people see some income – but is that "working?" That's a very broad definition.

I fully expect "governing bodies" to accumulate as we go, but the one thing that a governing body requires is the ability to allocate force. There is one means of force on the blockchain – the flag. You can be coerced only by denying you the fruit of the sweat of your brow and of the approval of your peers. You can be coerced by keeping you from getting rewards.

Welcome to the new age.

This actually got me thinking: Could a state or government exist without any direct taxation, but all expenses from security over education to infrastructure would only be paid by inflation?

Short answer: no.

Long answer: Hell no.

Remember, inflation actually dilutes the value of individual tokens and open distributed ledgers. That is because we know, for a fact, there is a finite number of potential blocks in the blockchain. The overall idea is that as those blocks are allocated, as the blockchain is used, the rarity of individual blocks will increase the value of the tokens exchanged for being able to affect those blocks faster than the rate of inflation, that is the rate at which blocks are "mined" or "witnessed".

It remains to be seen if this is actually the case.

Real money, or as the crypto cultists like to refer to it, "fiat currency," operates in an entirely different way. There is no finite number of US dollars that can possibly be in circulation at any given time, value is pegged roughly to the productivity of the nation as an industrial and service provider. (There are entire fields of study which go into that and a lot more detail than I even capable of imagining.)

It's interesting to note that an increase of productivity in a blockchain-based commodity system is actually negatively correlated with the value of an individual token in that blockchain-based commodity system. That's why bitcoin keeps upping the difficulty of mining blocks, much faster than they expected to. People designed custom hardware to do it faster, thus increasing the productivity. In real currencies, that makes the value of the quanta of exchange more valuable. In cryptocurrencies/crypto-commodities, productivity increases increase the rate at which blocks are mined, increasing the speed at which the blocks are used up which increases rarity, but it seems that doing so pushes the rate of inflation up faster than people perceive the rarity increases the value of the token.

It's complicated, is what I'm saying.

Yet, strangely enough, here it works. It even creates some kind of feeling that everyone is sitting in the same boat, and a lot of the users are honestly trying hard to improve the platform for everyone.

Oh, sweet summer child. You are the reason that I lament ever having seen how the sausage is made. I wish that I could maintain the belief that the system is as you describe it.

But it's not.

Some of the users are honestly trying hard to improve the platform for everyone. The vast majority of the users? In it purely for themselves and doing a crap job of it.

I will point out that as a Randian Objectivist, I am perfectly okay with people who are in it for themselves and honest about it. If you find a system and you can exploit it, or work it, and understand it? I'm there for you, even if we have differing agendas. Even if you want different things. If you're in it for yourself, good on you.

But I hate seeing anybody do a crappy job of anything, and that's what we see. Though I suppose that a crappy job that works is still a job that works. The vast fields of automated bot posters which are turning out regurgitated web content posted to the blockchain just so other bots can vote it up? Pretty clever. It's absolute crap for making the blockchain a place which will appreciate in value, so ultimately self-defeating – but I appreciate the style. Even as I hate seeing the whole thing be more successful than writing informative and useful content.

The platform itself sabotages that intent, of course. Between the 30 minute window for voting to get curation value as a curator and the seven day limit for getting any reward from your work, it absolutely undercuts the idea that someone should use Steemit as a social media platform and will be rewarded for doing so. It actively rewards automation which doesn't sleep, can constantly be online, can respond within a 30 minute window to any given post, and the creation of content which is intentionally ephemeral and has absolutely no evergreen value. After all, why should anyone care about writing an article that has value for longer than seven days because they simply will not get rewarded for it?

And yes, those are things that I really loathe about the platform.

Oh, sweet summer child. You are the reason that I lament ever having seen how the sausage is made. I wish that I could maintain the belief that the system is as you describe it.

But it's not.

Some of the users are honestly trying hard to improve the platform for everyone. The vast majority of the users? In it purely for themselves and doing a crap job of it.

And yes, those are things that I really loathe about the platform.

IMO this is quite different to the rest of the Cryptosphere. On Bitcointalk, for example, there's more the us against them attitude (and much, much less respect for grammar, orthography, or human life in general).

Have you not looked around this platform? That seems like a pretty good summary of most of the crypto cultist activity, elsewhere and right here on Steemit. That's exactly why I refer to them as "crypto cultists."

The difference on Steemit is that most of the shilling is for STEEM itself, usually in the most ridiculous terms possible, alongside shilling for the next pump and dump altcoin. It is, after all, in the best interest of someone looking to ride Steemit to more money to pump up the place where they're doing their posting.

I did mention I'm a cynic, right?

Besides, I think it goes without saying that I never had a soul. At least several of my exes clean that's the case. If I were to go sell it for something, it would be at a proper crossroads, at midnight, and I would come away from the place with the ability to possess people, anyone, within a 1 km range.

I've given this a lot of thought.