Steemit how can this thing be workable long term?

[generalizethis]

Could someone give me some explanation as to why anyone would convert BTC to STEEM POWER? (not STEEM which is debased 92.5% to 100% yearly)

arhag's (currently #1 ranked) post summarizes some of the thinking, and also I'd suggest my comment there for a bit of elaboration. In essence Steem Power is a prepaid subscription to network access. By stocking up on Steem Power now you are speculating that access to the network will be worth more to more people in the future, who will then be clamoring to buy tiny slices of your Steem Power to get in or to maintain their access. Obviously, that is a very risky bet (all cryptos are, including Bitcoin).

https://steemit.com/steem/@arhag/where-does-the-money-come-from-a-look-into-the-economics-of-steem

You are basically going long for 2 years... in a crypto currency.

Seems extremely stupid to me.

Average of one year, assuming you start liquidating right away, but still, I agree, it is a very risky bet.

Price weighted average, but you wouldn't be able to decide when to sell. You'd be pre-deciding to sell early (or late).

You can sell your account too, probably at a reduced rate (though it would depend on your standing in the community).

@smooth, how long do curator's get payment on posts? Just want to know if that figures into the analysis.

I'd love to see a market for selling accounts develop. But since you can't transfer SP, then it means you really can't sell them in a secure way. So no such liquid market will develop. You basically have to trust someone to let them have your account and change the password. Someone has to go first and take all the risk.

Curation income is not worth anyone's time at only 3.875% of their holdings per year.

Looks like there's an opt-out option available--though seems like your on your own on how to work out the details of any sale.

https://steemit.com/blockchain/@dan/does-blockchain-security-need-to-be-completely-reworked

But then there's this from another post:

"Selling / Transferring Accounts"

"Under this system it is still possible to transfer accounts. You must either notify your recovery partner of the change or change the recovery partner. Transfers can be instant if you both trust the recovery partner, or they can take 30 days if you don't trust the recovery partner."

https://steemit.com/blockchain/@dan/steemit-releases-groundbreaking-account-recovery-solution

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[smooth]

Could someone give me some explanation as to why anyone would convert BTC to STEEM POWER? (not STEEM which is debased 92.5% to 100% yearly)

arhag's (currently #1 ranked) post summarizes some of the thinking, and also I'd suggest my comment there for a bit of elaboration. In essence Steem Power is a prepaid subscription to network access. By stocking up on Steem Power now you are speculating that access to the network will be worth more to more people in the future, who will then be clamoring to buy tiny slices of your Steem Power to get in or to maintain their access. Obviously, that is a very risky bet (all cryptos are, including Bitcoin).

https://steemit.com/steem/@arhag/where-does-the-money-come-from-a-look-into-the-economics-of-steem

You are basically going long for 2 years... in a crypto currency.

Seems extremely stupid to me.

Average of one year, assuming you start liquidating right away, but still, I agree, it is a very risky bet.

Price weighted average, but you wouldn't be able to decide when to sell. You'd be pre-deciding to sell early (or late).

You can sell your account too, probably at a reduced rate (though it would depend on your standing in the community).

@smooth, how long do curator's get payment on posts? Just want to know if that figures into the analysis.

I'd love to see a market for selling accounts develop. But since you can't transfer SP, then it means you really can't sell them in a secure way. So no such liquid market will develop. You basically have to trust someone to let them have your account and change the password. Someone has to go first and take all the risk. I suppose you could do it with trusted escrow.

Some sort of smart contract escrow is probably possible as well. After all, the transfer is a transaction on the blockchain which can be verified to have occurred.

Edit:There still seems to be an option to recover a stolen account. So, only a fool would buy an account. The seller could initiate this process after collecting the funds.

It just means such transactions take 30 days to close escrow. After that transfers are irreversible.

From my understanding, when you start powering down, you still have Vests, so you still have a share the 9:1 steam going into the vesting pool. The amount of Steem that you get each week should increase. In the end, you are going to get much more Steem than what you put in. You can hope the market does not plummet faster than the slow increase in the amount of coins that you receive each week.

Correct. The portion that hasn't powered down yet is still considered Steem Power with all the usual benefits.

@smooth, how long do curator's get payment on posts? Just want to know if that figures into the analysis.

Until the first payout which is currently 24 hours or longer but is being changed to 12 hours or longer. In practice active posts stay open longer before the first payment (2 days or more is common), which is the reason the initial deadline is being cut. Only quite inactive posts will close after 12 hours.

Currently authors get new payouts daily (with same delay rules, but these are much less likely to be triggered for older posts with slower activity) for votes after the first payout, but curators do not. This is being changed to have a single 30 day period for authors to collect new votes after the first payout. Curators still won't get rewards after the first payout.

[iamnotback]

Edit: Thinking more about this. The price paid to cash out early will be a function of the volatility. We know this from the pricing of futures markets. The higher the volatility, the lower the price the seller will receive. Also there will need to be some time-weighted factor of blackswan computed by the buyer. The seller will pay in advance for 1 year of risk in terms of lower selling price.

A way to sell locked up accounts doesn't really change the fact that the investor is locked up for 1 year of weighted price risk.

[AlexGR]

Other than deluded n00bs, who is long-term investing in Steem?

Could someone give me some explanation as to why anyone would convert BTC to STEEM POWER? (not STEEM which is debased 92.5% to 100% yearly)

Blockchain investment has, let's say, 2 main types

1) individuals like those of us who frequent btctalk
2) funds who are dealing with millions or billions and are throwing money like there is no tomorrow - types of funds that have ETH at 1+bn marketcap despite all its clusterfucks

The money invested by group (2) is in the hundreds of millions, if it hasn't exceeded a billion already.

Buying a stake at something like Steem could be an investment, for them. They'd essentially be betting on its success and expansion.

Now, in a world where stuff like messaging apps and snapchats and online games can fetch billions or tens of billions, this is not very unlikely to happen.

For group (1) the dynamics are entirely different and what they do with their 1-5-10-100 btc investment is a whole different issue.

[iamnotback]

Other than deluded n00bs, who is long-term investing in Steem?

Could someone give me some explanation as to why anyone would convert BTC to STEEM POWER? (not STEEM which is debased 92.5% to 100% yearly)

Blockchain investment has, let's say, 2 main types

1) individuals like those of us who frequent btctalk
2) funds who are dealing with millions or billions and are throwing money like there is no tomorrow - types of funds that have ETH at 1+bn marketcap despite all its clusterfucks

The money invested by group (2) is in the hundreds of millions, if it hasn't exceeded a billion already.

Buying a stake at something like Steem could be an investment, for them. They'd essentially be betting on its success and expansion.

Now, in a world where stuff like messaging apps and snapchats and online games can fetch billions or tens of billions, this is not very unlikely to happen.

For group (1) the dynamics are entirely different and what they do with their 1-5-10-100 btc investment is a whole different issue.

You can't buy the company, there isn't one seller.

Due to the wealth effect it is very difficult to buy a company on the open market exchanges. The price goes up as you try to buy it, due your buying.

And 90% of the market capitalization will remain in SP which is mostly liquid.

I suppose you really only need 50% of the tokens to take control of the blockchain.

But the blockchain is decentralized, so you don't need to buy Steemit. You can just build a new client and use the database.

[smooth]

Other than deluded n00bs, who is long-term investing in Steem?

Could someone give me some explanation as to why anyone would convert BTC to STEEM POWER? (not STEEM which is debased 92.5% to 100% yearly)

Blockchain investment has, let's say, 2 main types

1) individuals like those of us who frequent btctalk
2) funds who are dealing with millions or billions and are throwing money like there is no tomorrow - types of funds that have ETH at 1+bn marketcap despite all its clusterfucks

The money invested by group (2) is in the hundreds of millions, if it hasn't exceeded a billion already.

Buying a stake at something like Steem could be an investment, for them. They'd essentially be betting on its success and expansion.

Now, in a world where stuff like messaging apps and snapchats and online games can fetch billions or tens of billions, this is not very unlikely to happen.

For group (1) the dynamics are entirely different and what they do with their 1-5-10-100 btc investment is a whole different issue.

You can't buy the company, there isn't one seller.

There is already at least one significant fund (crypto oriented) that invested in SP as a long term play. That others may as well is not implausible. I agree with AlexGR. That has nothing to do with buying the company, and may even turn out to be more valuable than buying the company anyway since it isn't clear what business value the company has other than its SP holdings. People can and will access the platform while bypassing the web site.

[AlexGR]

You can't buy the company, there isn't one seller.

Due to the wealth effect it is very difficult to buy a company on the open market exchanges. The price goes up as you try to buy it, due your buying.

There are ways to do it outside the market. With discount

[iamnotback]

Other than deluded n00bs, who is long-term investing in Steem?

Could someone give me some explanation as to why anyone would convert BTC to STEEM POWER? (not STEEM which is debased 92.5% to 100% yearly)

Blockchain investment has, let's say, 2 main types

1) individuals like those of us who frequent btctalk
2) funds who are dealing with millions or billions and are throwing money like there is no tomorrow - types of funds that have ETH at 1+bn marketcap despite all its clusterfucks

The money invested by group (2) is in the hundreds of millions, if it hasn't exceeded a billion already.

Buying a stake at something like Steem could be an investment, for them. They'd essentially be betting on its success and expansion.

Now, in a world where stuff like messaging apps and snapchats and online games can fetch billions or tens of billions, this is not very unlikely to happen.

For group (1) the dynamics are entirely different and what they do with their 1-5-10-100 btc investment is a whole different issue.

You can't buy the company, there isn't one seller.

There is already at least one significant fund (crypto oriented) that invested in SP as a long term play. That others may as well is not implausible. I agree with AlexGR. That has nothing to do with buying the company, and may even turn out to be more valuable than buying the company anyway since it isn't clear what business value the company has other than its SP holdings. People can and will access the platform while bypassing the web site.

Why they would buy into a blockchain debasing at 15-21% yearly for SP holders and which has a license saying it can't be forked (then who the fuck can improve it? Only Dan and Ned?)?

I guess they haven't learned yet that open systems beat closed ones. They probably didn't do the math on the debasement correctly also.

[smooth]

Other than deluded n00bs, who is long-term investing in Steem?

Could someone give me some explanation as to why anyone would convert BTC to STEEM POWER? (not STEEM which is debased 92.5% to 100% yearly)

Blockchain investment has, let's say, 2 main types

1) individuals like those of us who frequent btctalk
2) funds who are dealing with millions or billions and are throwing money like there is no tomorrow - types of funds that have ETH at 1+bn marketcap despite all its clusterfucks

The money invested by group (2) is in the hundreds of millions, if it hasn't exceeded a billion already.

Buying a stake at something like Steem could be an investment, for them. They'd essentially be betting on its success and expansion.

Now, in a world where stuff like messaging apps and snapchats and online games can fetch billions or tens of billions, this is not very unlikely to happen.

For group (1) the dynamics are entirely different and what they do with their 1-5-10-100 btc investment is a whole different issue.

You can't buy the company, there isn't one seller.

There is already at least one significant fund (crypto oriented) that invested in SP as a long term play. That others may as well is not implausible. I agree with AlexGR. That has nothing to do with buying the company, and may even turn out to be more valuable than buying the company anyway since it isn't clear what business value the company has other than its SP holdings. People can and will access the platform while bypassing the web site.

Why they would buy into a blockchain debasing at 15-21% yearly for SP holders and which has a license saying it can't be forked (then who the fuck can improve it? Only Dan and Ned?)?

I guess they haven't learned yet that open systems beat closed ones. They probably didn't do the math on the debasement correctly also.

You obviously disagree with their investment thesis. That's why markets exist.

[bones261]

I have a question. If you are in power down mode on your SP, but you keep earning SP through mining, curating and posting rewards, are the new rewards also being powered down? Or do you have to reboot your power down to include those?

[smooth]

I have a question. If you are in power down mode on your SP, but you keep earning SP through mining, curating and posting rewards, are the new rewards also being powered down? Or do you have to reboot your power down to include those?

Have to reboot the power down to include new earnings.

[tonyk]

Other than deluded n00bs, who is long-term investing in Steem?

Could someone give me some explanation as to why anyone would convert BTC to STEEM POWER? (not STEEM which is debased 92.5% to 100% yearly)

Blockchain investment has, let's say, 2 main types

1) individuals like those of us who frequent btctalk
2) funds who are dealing with millions or billions and are throwing money like there is no tomorrow - types of funds that have ETH at 1+bn marketcap despite all its clusterfucks

The money invested by group (2) is in the hundreds of millions, if it hasn't exceeded a billion already.

Buying a stake at something like Steem could be an investment, for them. They'd essentially be betting on its success and expansion.

Now, in a world where stuff like messaging apps and snapchats and online games can fetch billions or tens of billions, this is not very unlikely to happen.

For group (1) the dynamics are entirely different and what they do with their 1-5-10-100 btc investment is a whole different issue.

You can't buy the company, there isn't one seller.

There is already at least one significant fund (crypto oriented) that invested in SP as a long term play. That others may as well is not implausible. I agree with AlexGR. That has nothing to do with buying the company, and may even turn out to be more valuable than buying the company anyway since it isn't clear what business value the company has other than its SP holdings. People can and will access the platform while bypassing the web site.

Why they would buy into a blockchain debasing at 15-21% yearly for SP holders and which has a license saying it can't be forked (then who the fuck can improve it? Only Dan and Ned?)?

I guess they haven't learned yet that open systems beat closed ones. They probably didn't do the math on the debasement correctly also.

The total lack of reason* to buy steem (in order to power up) is central point [of failure] where this complicated house of cards is most unstable.

*Notwithstanding today's smooth comment that subsciptions fees tend to go up for successful companies.

[iamnotback]

Other than deluded n00bs, who is long-term investing in Steem?

Could someone give me some explanation as to why anyone would convert BTC to STEEM POWER? (not STEEM which is debased 92.5% to 100% yearly)

Blockchain investment has, let's say, 2 main types

1) individuals like those of us who frequent btctalk
2) funds who are dealing with millions or billions and are throwing money like there is no tomorrow - types of funds that have ETH at 1+bn marketcap despite all its clusterfucks

The money invested by group (2) is in the hundreds of millions, if it hasn't exceeded a billion already.

Buying a stake at something like Steem could be an investment, for them. They'd essentially be betting on its success and expansion.

Now, in a world where stuff like messaging apps and snapchats and online games can fetch billions or tens of billions, this is not very unlikely to happen.

For group (1) the dynamics are entirely different and what they do with their 1-5-10-100 btc investment is a whole different issue.

You can't buy the company, there isn't one seller.

There is already at least one significant fund (crypto oriented) that invested in SP as a long term play. That others may as well is not implausible. I agree with AlexGR. That has nothing to do with buying the company, and may even turn out to be more valuable than buying the company anyway since it isn't clear what business value the company has other than its SP holdings. People can and will access the platform while bypassing the web site.

Why they would buy into a blockchain debasing at 15-21% yearly for SP holders and which has a license saying it can't be forked (then who the fuck can improve it? Only Dan and Ned?)?

I guess they haven't learned yet that open systems beat closed ones. They probably didn't do the math on the debasement correctly also.

You obviously disagree with their investment thesis. That's why markets exist.

Did they buy at a much lower price such as a month ago? If yes, then it seems more rational.

What professional investors want to buy at these higher prices and lockup for 1 year weighted average when the insider whales (who mined nearly at no cost) have many millions of SP they can dump on the market in 104 weekly installments.

The only reason to be bullish that I can see is if you think the demand for STEEM will increase. And the only reason I can find for that which makes any sense to me, is if the transactions involving STEEM will increase to $billions per year. That is a very big if.

I don't believe there is any hope for system where you have to buy STEEM in order to be able to use it. Every social network which has tried to charge has failed. Users don't want that.

Paypal charges the merchants not the payer.

[AlexGR]

What professional investors want to buy at these higher prices and lockup for 1 year weighted average when the insider whales (who mined nearly at no cost) have many millions of SP they can dump on the market in 104 weekly installments.

You shouldn't be asking this: There are professional investors who are buying the ethereum clusterfuck up to 1bn and beyond, which has just a tiny percentage of use cases compared to a mass-appeal social network/content platform.

Also look at that: http://www.coindesk.com/bitcoin-venture-capital/

Circle: 136mn VC funding
bitFlyer: 34mn
vogogo: 21mn
21 inc: 121mn
coinbase: 106mn

etc etc

Tell me, would you ever give something like 100mn+ to an exchange like ...coinbase?

I mean wtf. People are like "shut up and take my money" because it's "bitcoin/blockchain" etc etc.

[smooth]

The total lack of reason* to buy steem (in order to power up) is central point [of failure] where this complicated house of cards is most unstable.

*Notwithstanding today's smooth comment that subsciptions fees tend to go up for successful companies.

I actually agree with that. My comment was in the context of arhag's post about the economic model and where the revenue comes from. Nevertheless I have no idea how much the implied fees will go up and whether that is sufficient to support any particular valuation. There are enormous uncertainties to it.

There is really no good reason to buy Steem now to power up, as an immediate practical consideration. No one needs it. The only reason is speculation on future value.

The only reason to be bullish that I can see is if you think the demand for STEEM will increase. And the only reason I can find for that which makes any sense to me, is if the transactions involving STEEM will increase to $billions per year. That is a very big if.

Agree somewhat. SP as buying access to the network may or may not also be significant, even if the transactions on the network (which will need to be extremely high in volume for this to matter) are not necessarily (exclusively) financial.

[iamnotback]

Also look at that: http://www.coindesk.com/bitcoin-venture-capital/

Circle: 136mn VC funding
bitFlyer: 34mn
vogogo: 21mn
21 inc: 121mn
coinbase: 106mn

Steem is already too expensive then at higher market capitalization than those funding rounds.

But I agree with that the central banks flooded the world with money that can't find a good ROI.

So why shouldn't I compete with Steem and go get some of that ?? Especially the UI and social networking part is precisely what I like to code on. Give me one good reason. You think I will earn $200k on Steemit cashed out. I doubt it. Creating even a half-assed clone of Steem would probably net me way more than $200k.

(If my health was perfect, I wouldn't even be contemplating it anymore, I'd already be coding it. I'm a bit more cautious/less confident because of my health debacle.)

[generalizethis]

Also look at that: http://www.coindesk.com/bitcoin-venture-capital/

Circle: 136mn VC funding
bitFlyer: 34mn
vogogo: 21mn
21 inc: 121mn
coinbase: 106mn

Creating even a half-assed clone of Steem would probably net me way more than $200k.

You could, but saying it before you do it is like the Great Oz going, "You see that curtain, I'm gonna go stand behind it an create illusions.

[iamnotback]

You could, but saying it before you do it is like the Great Oz going, "You see that curtain, I'm gonna go stand behind it an create illusions.

Are you challenging me?

I asked why I shouldn't and instead of addressing my question, you reply saying I am just talking and can't doing.

Your drooling infatuation with Steem is a bit of extra motivation for me. After criticizing Dash so much, you've suddenly got a God complex with Larimer's butthole.

[generalizethis]

You could, but saying it before you do it is like the Great Oz going, "You see that curtain, I'm gonna go stand behind it an create illusions.

Are you challenging me?

I asked why I shouldn't and instead of addressing my question, you reply saying I am just talking and can't doing.

Your drooling infatuation with Steem is a bit of extra motivation for me. After criticizing Dash so much, you've suddenly got a God complex with Larimer's butthole.

Whoa, pull it back and read between the lines. What I'm trying to tell you is that every post you've ever made becomes troll bait if you play that game and that quotation specifically will be used given the timing of your venture--I'm saying you have a lot of negatives to overcome (other than coding) to pull this off. I like you Shelby, but I'm not going to ignore the obvious to appease your ego. The little things--that have little to nothing to do with coding--are part of  any platform's analysis for success. You don't like it (who does?), but it's there. If you are angry with me, fine. But don't count on me apologizing for a heads up.

[AlexGR]

So why shouldn't I compete with Steem and go get some of that ?? Especially the UI and social networking part is precisely what I like to code on. Give me one good reason.

I don't know about disincentives / reasons-not-to, but I see practical issues on why it could fail.

Steem = first mover + big marketcap + big payouts.

Can you replicate the payouts and the network effect it will have by the time you finish your own design and launch? If not, then you can't attract people.

My prediction with steemit is that in the next period we are going to see a lot of holes and a lot of duct tape. And the duct tape might hold it together sufficiently, at least until some aspects get an overhaul in terms of game theory with more refined algorithms that do not need the duct tape. Nobody (I don't mean individuals, I mean groups of coders - I think individuals are out of the question) will be able to deliver something as workable by the time it starts getting serious momentum.