What are Dust-Rewards?

Did you know that small rewards are swept under the rug as "dust"?

Let's talk about that!

^{_{original picture of dust on my retired television console}}

Most blockchains have some kind of dust-rule, usually intended to prevent spam from clogging up the network.

To get a grip of the idea, let's first look at the dust definition in the bitcoin protocol. It's easily simplified as: Any transaction which does not transact a minimum value (defined as 3 satoshis per byte) isn't worth confirming, and will be ignored (not written to the blockchain). Combined with transaction-fees, that's a pretty straight forward and effective solution to keep "uneconomic" transactions off the chain.

Things get a bit more confusing, though, once we enter the fee-less territory of a content driven blockchain. Steem's dust-rules seem to attack the horse from the opposite side (you'll be the judge of which side that is!), but before we go into my lingering critique, let's look at what dust is defined as in the steem protocol.

Well, there are actually two dust limits. The first one just checks if you have enough voting power to cast a vote and similar to how bitcoin does it, doesn't allow your vote to be accepted on the chain if it is too miniscule. You'll eventually see this happen when you have very little SP and your voting power is drained. This is pretty straight forward, but I want to talk about the second dust-definition on steem: "reward-dust".

This "reward-dust" definition doesn't get checked until content gets evaluated for payout. The payout function will check if the total rewards fall below the reward-dust-threshold, and if that is so, it will treat them as zero. So it does not actually prevent any transactions from being included on the chain, rather it just tries to disincentivize the posting of "uneconomic" content by preventing small rewards from being paid on it!

The precise reward-dust-threshold that's currently being used by the steem network is at 0.020 SBD in combined rewards on any piece of content as defined here, in the source code of the steem blockchain protocol:

_{Screenshot of Line 208, STEEM_MIN_PAYOUT_SBD in steem/protocol/config.hpp on GitHub.
^{P.S.: To learn what the lines 210 & 211 are all about, check my previous #steemonomics post on the value of SBD}}

The fact that most popular steem frontends are displaying the rewards as SBD rounded to two decimals points doesn't help communicating the fact either, so it shouldn't come as a surprise that many users here are unaware of this little peculiarity. I've been here for almost two years now and I didn't ever really consider the implications of this myself.

So what does that mean for our steem experience?!

 

Don't Waste Your Votes!

To generate the minimum payable reward value of 0.020 SBD, you currently need about 100SP casting a 100% up-vote at full voting power!

But due to the constant price fluctuations affecting the projected rewards on content, too, such a vote could easily still drop to 0.019 SBD or lower before payout and then end up going to dust. This isn't really a major issue on posts that will hopefully accumulate rewards from more than just a single vote, but it should be considered when upvoting comments.

Voting on comments is a crucial element in building relations, engaging with and appreciating your audience and peers on this platform, and in my opinion it's one of the best ways to support organic growth in the community. But if your voting power doesn't pack enough punch to actually generate rewards, it will be left with nothing but it's purely symbolic value. Don't underestimate that, though, it still goes to show your appreciation and that's what really matters in the end, but you also don't want to have all your voting power evaporate and settle as dust!

Know the Value of your Vote!

There are a bunch of tools that will give you more detailed information about your actual vote values, here are two easily accessible options for anyone to use:

1. The Steemnow.com Upvote Calculator
   This handy tool by @penguinpablo let's you calculate vote-values based on the current network properties (price-feed and reward-balance) very accurately. Unfortunately it also falls into the trap of rounding to just two decimals, but you can easily just help yourself by adding a zero to the total Steem Power:
   
   ^{Note: With an added zero this reads 1000SP = $0.20 to determine 100SP = 0.020 SBD}

2. The Block Explorer Steemd.com
   If you need detailed, raw information about anything that has happened on the chain, this tool by @roadscape is your place to go. You can actually use any steemit or busy URL and replace the domain with steemd.com to open a detailed view of a post or comment on steemd, and by clicking into the "advanced mode" it will show you ALL THREE decimal points in the pending_payout_value field:
   

So now that we know how we can work with the rules we have, let's finally start complaining. Are they effective, do they even make sense?

 

Food for Thought

Does sweeping dust under the rugs really keep the house clean?

My own misconception about the reward-dust rules on steem always came from the fact, that I "understood" reward calculations such as the 50/50 split are not really practical in the lowest decimal places. The idea of this being seen a spam-prevention rule, though, really never occurred to me until I read this post by @timcliff a few weeks ago. He proposes a thought to raise the dust limit significantly in order to make spam less profitable. The post sparked quite a lot of opposition and productive discussions, but most of all, it showed how few people actually were even fully aware of this rule.

I share the concerns about spam on this platform and the problems coming with dummy accounts operating with the sole purpose of spamming and/or voting on malicious spam, but I also have my doubts about raising the dust limit having much of an effect on that issue at all. It would however make it extremely hard for the average red-fish and minnow here to ever grow their account!

I believe steem's long term value comes from it's genuine user-base, and most users here have very small accounts when they join this great experiment. These users need encouragement and empowerment, and most importantly, they need to be able to empower each other without relying on whale-support or investments into voting-bots. A healthy community on this platform is being built with dust-votes, not with big investors. We shouldn't sacrifice the incentives for real and legitimate beginners here just to "make spam less profitable".

Possible Improvements

Well, I guess I've made clear I am not really a fan of the dust-rules here, but let me also give you some constructive thoughts:

1. Why Can't we just show all three decimals in all these frontends?
   Or maybe even show them as the actual zero they'll be treated as while they fall below the dust-limit?! Subtly communicating this would create at least some awareness for this circumstance.

2. Actually: Lower the dust limit to 0.01 SBD or even remove it completely!
   I strongly believe the dust limit is doing more harm than good by slowing the growth of legitimate steem beginners. I do see a need to keep some limit above the last decimal point just to keep the maths practical when issuing rewards in split SP/SBD, but other than that I do not see it's purpose!

3. An my final thought: Maybe transaction fees aren't such a bad thing?
   I've detailed my concerns about no existing incentives for "burning" SBD in my previous #steemonomics post, and I quite like the idea of low SBD transaction fees for posting to this blockchain. This is a very unrealistic proposal and it kind of goes against what this protocol sees itself as, but I think it would be by far the best method to disincentivize spam and fixing some issues with the inner-economic balance (SBD debt-ratio) on this platform.

 

---

So what do YOU think?

Were you aware of the dust limit at all?
Do you think it is an appropriate tool to prevent spam?
How many of your votes have ended in dust?

And what about Transaction Fees?

I know, it's kind of a ridiculous idea, but I do think it makes sense!!

 

^{P.S.: @crokkon made me aware of the ambiguity of the term dust in this comment below - to avoid spreading confusion on the matter I have edited the post to speak of "dust-rewards" instead of "dust-votes" now.}

---

^{Further reading on the topic:}
_{Proposal to make spam less profitable by @timcliff
Votes to the Grave by @leeart
Whales Need Minnows More Than Minnows Need Whales! by @oleblueeye
Introducing Dustsweeper by @davemccoy & @danielsaori}

^{01101101011001010110111001110100011010010110111101101110011000110111010101100100011001000110110001100101011100110111010101101110011001000110010101110010011101000110100001100101011100100111010101100111}

_{fraenk loves you!}