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I think it's really time that we as a community take a serious look at the power distribution and influence issues within the community.
Today, if someone wants to become very influential ( whale status) on the site, he/she needs to spend at least a few hundred thousands dollars and that's with a price of $0.1 per steem. If the price per steem would be $1 that same person would have to spend over a million to be a whale.
I mean this site has barely over 1000 active users and we expect people to spend millions to get a good influence on it , com'on we need to come back down to earth and accept that we are not facebook yet and that even if we were no one is going to pay that kind of money to get influence on a social media site. What audience is steemit targeting? The jetset?
Whales, for the very large part were early miners, they had the foresight to see this good opportunity and took it. They didn't spend millions to get there ( no one in their right mind would), however they deserve the money 100%. But what about the influence, don't you think whales could give up a little bit of their power for the betterment of this platform? You tell me
Right now, 1% of all steemians own about 90% of the voting power, please check the graph for yourself http://steemwhales.com.
This is one of the reason steemit have a pretty bad rep in the crypto community ( ponzi claims,etc..) and is also the main reason why people don't want to buy steem or even don't want to get involved at all in this site. They feel that there is a strong sense of unfairness within this community which is very understandable.
The good news however is that whales aren't the actual root of the problem because power distribution will be a perpetual issue regardless with the current specs, let me explain. Every time the price of steem increases it makes it more difficult for the people that comes next to get influence. The later users register on steemit the more discriminated they are.
Let's take a look at this chart for a sec
From this graph you can get a glimpse of what viral adoption on a social media looks like. As you can see even on a site as sucessfull as facebook the user base take years to built up. The point I want to make with this graph is that users don't just adopt a website the same day, they adopt it in years, even decades( I'm sure facebook still has a lot of new users registering to this day). You can also see, by comparing the two charts that there is a clear correlation between user growth and valuation ( price) . Any company will be valued higher as the user base grows, this is even more true for social media platform because their revenue model is extremely dependants on active number of users. Steemit will be no exception, the more users there will be the higher the price per steem.
So what's the issue ?
Well, steem will soon become a pretty scarce token and its price will very likely go up gradually as more users use the site. That's the goal anyway since rewards should increase to handle the growth of the user base. So if 6 months from now the price is $1/steem, a year from now $5/steem, 2 years from now $15/steem, 3 years from now $40,etc.. you can clearly see how it's problematic..late adopters will never be able to start on an equal footing with others and get any significant influence in the system. This is enough for most users to run away from a site based on power and influence. The first rule on a platform like steemit is that all users should start on a level playing field no matter when they registered.
I often hear the argument that we need a low price to accelerate power redistribution. This is not a sustainable solution.
Right now we could have the best evenly distribution among all participants, the issue would still be there. Let me explain, 6 months from now every new users would pay a higher price than we did for the same influence , a year from now new users would pay an even higher price again for the same influence, and it's only going to get worse from there...so our perfectly even distribution will end up being the same distribution we have now. Whales who genuinely think they will help redistribute power by dumping their share at rock bottom price are wrong, because as I have just demonstrated the distribution issue is a perpetual issue.
Some might say: Yeah okay, but what if the price doesn't increase? As I have explained above with the graphs, if the price doesn't increase it would be a direct indication that steemit user base is stagnant and that the project has failed to achieve mainstream momentum. This is not an option I consider when I think about the future of steemit.
Curation guilds is something that comes up regularly in the discussion which is meant to solve this issue. The problem I have with curation guilds is that they disincentivize people to buy or earn steem power. A curation guild will give anyone regardless of their voting power the ability to have more influence without getting more steem power. This is a real problem in a system that relies on people buying steem power. These guilds are band-aid solution to a deeper issue.
Here is a proposal which could (if practical) address these problems.
The idea is to have 6 different influence/power levels within the community. Users within each levels will own all together a certain percentage of the total voting power which means that all users in the same level will have equal voting power.
- Level 1 ( newbies) - users with < 1000 SP - owns 3% of total voting power (vest)
- Level 2 (plankton) - users with < 5000 SP - owns 8% of total voting power (vest)
- Level 3 (minnows) - users with < 10 000 SP - owns 13% of total voting power (vest)
- Level 4 (orcas) - users with < 25 000 SP - owns 18% of total voting power (vest)
- Level 5 ( dolphins) - users with < 50 000 SP - owns 25% of total voting power (vest)
- Level 6 ( whales) - users with < 100 000 SP - owns 33% of total voting power (vest)
Now this is only one part of the proposal, these levels alone do not solve the problem of the increasing difficulty to gain influence as price rises. To solve this issue we need to adjust SP level requirement so that each level do not exceed a certain amount of dollar value.
At today's price those SP level requirement are reasonnable and accessible to everyone. In order to obtain level 2 a user needs more than $115 worth of steem power. Someone who wants to reach whale level would need more than $11500. Which to me seems pretty on target. I do not pretend to have the right numbers ( limits), these could probably be a little bit higher, however definetely not millions of dollar for whale level, not even in your wildest dreams!! Levels should be accessible to all in order to be meaningful and appealing to users.
The price of steem is constantly moving so the best would be to set those limits in dollar and have the SP level requirement constantly adjust to match the limits.
If this isn't feasable then parameters (limits) could be changed manually when deemed necessary, if the price goes too high and levels becomes too difficult to reach for users.
So what are the benefits of this proposal?
- every users will start on an equal footing
- influence will still be accessible to users even if the price increases ( SP level requirement adjustment)
- whales,dolphins,etc status will finally have a real meaning to users who can set their goal level ( psychologic incentive)
- voting power will be much more evenly distributed
- greater community feel and less selfish behaviour
- users will still have an incentive to buy steem power to gain influence regardless of the steem price
- more human curators with more power = more content diversity
- tone vays and all the naysayers will probably start to use steemit
What are the potential downside?
I wrote this post because I want you to tell me about them. So please don't hesitate to comment below
I can see one possible problem in that if there is only 6 levels of power, it seems like there would also only be 6 levels of curation rewards. Good curators would still be able to receive more rewards than others but the proposal could mean a slight disadvantage for people with very high balances well beyond $11500, however these balances would still receive more steem than others from the newly created supply.
If we want to please everyone, there will have to be some trade offs along the way though at some point and I think adjusting the parameters to slighty benefit average people over rich people on the platform is a winning strategy because the “middle class” people will represent 99% of users in the future. I don’t expect many people will have well over 10 grand in their social media site account. The good thing is that rich people ( and everyone for that matter) could still take advantage of the steem dollar interest rate.
Also it is not clear yet but maybe the curation rewards doesn’t necessary have to be split in 6 levels and could still be allocated in the exact proportion of one’s SP balance while voting power is split in 6 different levels. I want to hear from the devs about this.
Conclusion
I understand people generally don't like change but steem will have to evolve if it wants to gain mainstream appeal, I consider what I have mentionned in this post a fundamental problem, in the same scope as the hyper inflation issue( which is being fixed).
It may not be obvious to everyone that these are actual problems as the price of steem today is extremely low so the redistribution is kinda happening, albeit very slowly still. But whales are essentially just passing the baton to other users and creating a second generation of whales.
In the grand scheme of things what is happening right now with distribution is meaningless as we are only at the very beginning at a very low price with a very low user base. We need to project ourselves in the future and think big to see what kind of issues we are going to face.
I also understand that there may be some conflict of interest for such proposal, however I think if we want to evolve it's time to ignore selfish behaviours and start acting for the benefit of the community as a whole.
I would appreciate input from the community whether you agree or not and also really interested to know if the steem blockchain is compatible with these changes.