Steem Basic Income's drive to last forever
We’ve all heard of the word sustainability, but what does it really mean? Whether it refers to agriculture, development or income schemes, sustainability is a measure of a project's lasting viability. We can say a project is sustainable if it generates today’s value without sacrificing the value of future generations.
Do You Know what Steem Basic Income is?
Steem Basic Income is a social experiment to bring a basic income to as many Steemians as possible. Members join by sponsoring others into the program. Steem Basic Income is delivered through providing regular upvotes to member content.
The following definition of sustainability from investopedia focuses on corporate sustainability:
With these definitions you will see that in many ways, sustainability is a key vector in determining project quality, but even has great repercussions over whether something is, for example, a ponzi scheme. Here, I will break down the math behind the long-term sustainability of Steem Basic Income (SBI) and reveal with which metrics we will be able to track our progress!
How does SBI work?
You may recall that the SBI program receives 1 steem to enroll each of 2 shares. The voting program itself uses the equivalent of 2 Steem Power per share, so already we can see the initial complication – for every 1 STEEM coming into the program, 4 SP of voting weight are required. Because of this, steem power delegations are leased.
The program uses various methods to achieve sustainability. We never use new enrollments to fund old leases, because that would make it a ponzi scheme, ipso facto.
In this series, I will be reviewing all of the concepts involved in maintaining the long term viability of the Steem Basic Income Program!
Sustainability Metrics
Native Steem Power
Over time, every program must develop its own native Steem Power. The benefit of having a growing pool of Steem Power cannot be overstated. While delegated SP can eventually be withdrawn, Steem Basic Income’s native Steem Power will continue to support our members forever.
Author Rewards
The first strategy we use to achieve sustainability is to harness the power of steem with Author Rewards. These author rewards are so essential to the long term viability that we have introduced an upvoting rewards mechanism, further explained here. Author rewards produce both Steem Power and liquid STEEM or SBD.
We are transitioning from scheduled self-votes to self votes driven by the same multiplier-based voting mechanism. Our pending self-vote balances will be adjusted manually as needed, to keep our self-voting below 10% of total voting power. This threshold is in line with management costs of other projects on the Steem platform, although in this case the self-vote benefits our members by allowing us to keep APR higher.
Curation Rewards
Another very important category in achieving sustainability is curation. To maximize curation, we use an optimization algorithm that adjusts our voting times. Certain changes in user behavior, as well as systemic changes such as those made during Hard Fork 20, will affect the time at which Steem Basic Income accounts will vote.
In the image above, it becomes clear that the ‘basic’ strategies are sometimes almost enough to achieve sustainability. It is important to mention that ‘sometimes almost’ is not sustainable, but being close is much better than being far away!
SBD Conversion
To close the gap and go the final distance, Steem Basic Income has a few ‘advanced’ strategies up its sleeve. Recently, we have been using conversions of SBD. This is an arbitrage opportunity, taking advantage of the difference in price of SBD in the market (currently less than 1 dollar) and the one dollar of ‘steem promise’ that the SBD represents. By buying SBD with STEEM for less than one dollar and then converting that SBD to one dollar’s worth of steem, Steem Basic Income has been able to make a small profit on the side that is reinvested into the program. This opportunity is only available during certain market conditions.
A focus on sustainability is at the heart of our program. Over the coming weeks and months, we will continue to explore in great detail our quest for Sustainable Steem Basic Income. Leave your questions for us in the comments section and, as always, STEEM ON!
Writer Bio
This Sustainability report was prepared for us by @ecoinstant.
From a young age, @ecoinstant continues to be very interested in the mechanisms of sustainability, and loves being a part of several teams working on promising projects, including the marvelous Steem Basic Income!
Questions?
Please read our FAQ. If you still have questions, ask in the comments section or join us in our discord channel.
You can look up your current membership levels by using !sbi status in a comment or post, or by using our newly modified member lookup tool.
