HF 19 as it stands will either be bad or horrible from my perspective. These hardforks aren't inherently good or bad. It depends on what your goals are. I don't think this hardfork will accomplish my goals of growing the platform or supporting minnows. This is ironic because I think the hardfork is meant to do those things, but this is the story of unintended consequences. Needless to say, in the short term I don't like it.
Perceived HF19 intentions
The hardfork is designed to improve the outgoing rewards pool distribution and that may happen to a small extent in limited areas. It's meant to improve the usage of curation benefits and do a better job of capturing their rewards. It might do that too. However; those benefits will be massively outweighed by clustering of author rewards, which will drain ~60% of the reward pool into just 10-20 accounts (unless there is a massive manual intervention). I see that as bad. Maybe you don't... but I think it's bad.
That said, if it fails like I think it will then the blowback will help. If I'm wrong so be it. I've been wrong before. I got over it then too. If users go to extraordinary efforts to manually unfuck this thing it may appear to have worked, but only because some power users took things into their own hands. Like a lot of things around here it's up to the whales and the Witnesses they upvote to determine how this place works. Excited to see how things turn out about 1-2 months after it's implemented.
What do I want?
I want this place to grow. Pure and simple.
The world is run by immoral banksters that cause harm. Protesting isn't going to change it. Getting on the inside isn't going to change it. We gotta provide an alternative to the shitty economic system they have created and get a mass adoption going. If we can do that, then we can change the world.
I'm personally motivated to do this because the immoral banksters own the pharma companies and the research dollars involved in cancer research. Cures are known. Causes are known. We can end the cancer epidemic tomorrow if leaders stopped promoting cancer studies akin to tobacco science and talk extensively about the Race to the Cause instead of the Race to the Cure. It would be great if they start promoting actual cures instead of high priced medicines that cause further harm.
I'm a PhD scientist, I've done extensive research. I know about the mainstream studies. I've read them. I don't believe them anymore. They're lying and the research is fraudulent, and now I have a dead mother, two dead uncles, and a variety of family members missing their organs and a fat chunk of change because of it. Eventually, I'll probably die from cancer too. I have limited time to fix this place so my kids might have it better. I want this whole system to change, and I think Steemit could do it.
That's where I'm coming from.
Stakeholders
Who are the stakeholders here?
Whales
Merchants
Everyone Else
I'm not anti-whale or anti-merchant. They are important groups. But I'm a populist anyway and want to see this place grow and that means focusing on the needs of new users and lower power users to train, retain, and grow them. If I can do that I have a shot at changing the world. Seems like a worthy effort. This is why I've worked so hard since becoming a Witness 3 weeks ago to get a 500 person Discord channel going, get a 110k SP bot running to get them started, get the Minnow Support Project contests up and running, send a kid and his Dad to Steemfest and wrote a shit ton of Steemit tips articles.
fuck socialism
93% of the steem rests in 1% of the users. That's excluding the @steemit account. If you include @steemit it's basically all the steem in like 100 accounts.
I hate the distribution, but I'm a libertarian/anarchist so the plan shouldn't be to take from whales to give to minnows, but to gently guide a rewards pool distribution that incents helping baby accounts get wealthier.
What the fuck does all that have to do with HF 19
Here are the things that are important about the next Hardfork
Programmed-
Linear Rewards
Voting Pool use per vote
Rewards Pool Distribution Percentage
Current status-
SP distribution
Rewards Pool Distribution and the trending page
Witness settings
Social-
Whale non-voting experiment
The 3 most important aspects of the upcoming HF
Voting pool usage change
Whale experiment
Linear Rewards
Where do we stand today
Distribution Picture-
Rewards Pool Distribution Picture- 72% of future rewards going to authors
Author rewards pool
What will the hardfork do?
Let's start with Linear rewards. Linear Rewards is designed to fix curation. Curation is actually the wrong place to start. It's only 12% of the rewards pool distribution, and this tweak will at best be a 15% change to it. So overall a max of a 1.8% shift to distribution.
We can't talk about linear rewards all by itself because it's not actually the most important question. We have to talk about it in conjunction with the whale non-voting experiment.
I've created a fairly simple model. HF 18 non-voting whales, HF 18 voting whales, HF 19 non-voting whales, and HF 19 voting whales. The problem with simple models is that they aren't quite accurate and mine is no exception. What I've tried to do is think of 4 people voting on a post and trying to figure out what kinds of rewards they are going to get. This isn't an exact science, but I'm pretty comfortable with what I'm looking at in the first pass.
4 curators in a whales voting scenario
A mega Whale with 800,000 SP
A whale with 50,000 SP
A dolphin with 13500 SP
A minnow with 1200 SP
I've also done a whales not voting scenario. I know some whales are currently voting even in the non-voting experiment so it isn't perfect. That's why I bumped my normal whales value up beyond 50k but didn't include my mega whale who likely isn't actually voting all that much.
4 curators in a whales voting scenario
A muted mega Whale with 0 SP
A whale with 80,000 SP
A dolphin with 13500 SP
A minnow with 1200 SP
Then I thought ok. Let's imagine 4 different posts all go up to around $3k. It doesn't matter who authored them. They all vote on the same post around the 30 minute mark. I'm going to ignore the order for a second though I know it matters, but we need a simple model. Now imagine that there's $120 worth of rewards to split just between those 4 curators. Who gets what under the 4 cases?
Here's how it shakes out-
HF 18 No experiment mega whale gets 99.5% of the 120 bucks
HF 18 with experiment whale gets 97.2% of the 120 bucks
HF 19 no experiment whale gets 93%
HF 19 with experiment whale get 84%
The flat out most fair way to do this is HF 19 no experiment, but of these 4 options HF 19 with the experiment will do the most to encourage new users to come here. Through some combination of the benevolance of mega whales and likely increase in user base if whales continue not voting thus leading to a price increase I hope Linear Rewards goes through and the experiment continues. But that's small potatoes....
The future SP distribution is driven by author rewards
Look at how the rewards pool is paid out.
72% to Authors
13% to curators
7% to interest
5% to witnesses
2% to commentors
It shouldn't take a genius to figure out how to make a better overall distribution and grow this place. We tweak those categories.
Commenters... it's not worth dealing with
Witness pay isn't massive compared to what they have to do... maybe trim when the price goes up... but especially if competition goes up for these spots and people fight for the positions then we will actually get our money's worth out of the witness pool.
Interest should be at 0%. Why we're paying 7% of the reward pool to SBD interest is a bit of a mystery to me. I'm worried it's based on legacy policies that haven't been updated for like a year by some top 49 witness accounts that are driving percent interest above 0% and forcing the community to give a bunch of SP to SBD holders where it's really not necessary. Either they change or we vote them down in power and we can recapture a lot if not all of this 7%.
Curators... Linear rewards and the experiment will tweak this... but it's net effect at best is about a 15% change on 12% or at best about 1.8% difference in curation rewards pool distribution... This isn't a holy grail.
Author rewards- This is where it's at baby!!!
How do we point author rewards to growth?
Look at author rewards distribution now.
I can't integrate this data, but if I squint I think I see about 90% of the author rewards going to 8% of the authors. I know that's covered in the white paper, but I think it's too much. I think it's bad for the platform. Should top posters earn more than shit posters yes. Should it be that much? No. Why? Because it sucks for new users. This is subjective, but the current distribution isn't meeting the needs of new users.
I have a unique position running a group for ~500 minnows to know some of what they are struggling with. Yes it's only been 4 days, but I've only been a dolphin for about a month. I've been a minnow recently for about 10 months. So, I'm feeling kinda clued in.
They aren't sitting there talking about how fucked they are that they aren't maximizing their 2 cents a day of curation rewards. They are pissed that they can't get shit for authoring.
Curation has a built in slow growth curve for minnows. If you can't make a big bet on a post you can't get paid out even if it goes pure huge. So, minnow curation is kinda fucked. The most hope a minnow has for money is droppin' memes in whale comment's sections or hoping that 1 post actually catches a whale upvote. But there isn't a growth cap on authoring, so that's the best chance to make mega rewards for minnows and dolphins and seeing that all the rewards are going to the same ~30 authors every week makes that difficult to bear.
What's the 4x change in voting going to do?
It's going to concentrate votes even more on an even slimmer number of authors. If you think the reward pool is getting drained now by the same people over and over it's going to be 4 times worse. Why? because that's how you maximize curation.
I run @minnowsupport bot which is a newly minted whale account. 500 people autovote themselves about 1000 times a day. The curation rewards are shit because the posts don't get big because it's still largely ignored minnows we are talking about.
Instead take for example a recent 1 click $700 payout for a whale curating a big post. If you bet big on the posts that go huge you get a fat fucking stack.
I get why this was put in place. It was an incentive to upvote the best content and the assumption was that if more people upvote it then it's better content. That's not how this works in reality though. The goal for a serious curation maximizer is just to upvote the thing most likely to go huge and there's a steady predictable place to put that vote... then FUCK YEAH. that's guarenteed money! At $700 for 1 click you have way too much incentive to pig pile and not search out good content.
Now, imagine instead of placing a $50 bet on a post I get to place a $200 dollar bet on the post. My gains will get even larger. The posts will get even larger. My curation as a whale could be $2800 on a single post.... as the fucking curator!
The trending page is going to be filled with $12000 posts, but everyone else won't get shit because all the power will be in those 10-20 posts probably by the exact same authors every day. It's because curation is gamed to maximize rewards rather than used as designed to upvote the best content.
What's the takehome
If you're not a top author you're about to get fucked by HF 19, and it's gonna stall growth or shrink this platform. Linear rewards is barely perceptible. If the experiment stops it's gonna be even worse. This is a bad fucking plan. That said. It's good to run this expriment to show it's a bad fucking plan and when the trending page is 12k in a week and a half and everyone starts leaving we can go the opposite direction to tweak distribution to favor growth on the platform.
How do we tweak to grow the platform?
- Get rid of curation bonuses for pig piling.
- Spread out voting power to 80 votes instead of shrinking to 10
- Keep the non-voting whale experiment going
- Implement linear rewards
- Witnesses change SBD percent interest to 0 or you remove your witness vote on them
- Incent whales to upvote minnows by using less power or having a better rewards curve when they do
Help the people running and participating in the Minnow Support Project.
Let's hope I'm wrong. If I'm right let's work collectively to steer the ship on a different tack. If I'm wrong point and laugh and we'll all joke about this a month from now.