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In this instance, heavy inflation might actually be a plus for STEEM. This is because it doesn't appear to be intended as a store of value, but as an influence

In this instance, heavy inflation might actually be a plus for STEEM. This is because it doesn't appear to be intended as a store of value, but as an influence market. As far as I can tell - and I'm sure there's a lot I've misunderstood - STEEM is essentially a market for on-line influence. You gain STEEM for upvotes etc. and the more STEEM tokens you have (STEEM Power), the more influence you have in terms of who gets STEEM tokens. Now, this sounds kind of pyramid-y to begin with, but without significant inflation, such a system would seem doomed to form an oligopoly of a few users who, by virtue of their "STEEM Power" would gain an ever-increasing share of the tokens minted, pushing everyone else out and probably killing the whole ecosystem. Of course, that may still happen even with inflation.

truthforce 9y ago
It is proof of mind, and there are no miners anymore. By posting and someone upvoting you they are allocating the rewards that the steem witnesses generate. Witnesses all run servers and are chosen by democratic votes from all steem users to represent steem. The list of current witnesses who have power changes from time to time. Someone who was in power last month might not be in power for a few months as it changes between witnesses, giving an actual chance of getting rid of bad actors, whereas in proof of work mining there is 0% chance of taking out a bad actor as the miner owns their equipment and there is nothing you can do. There is a lot more you need to read and that is ok, you barely have any understanding of the fundamentals. People are able to allocate their steempower to other users. If large accounts are misbehaving, small and medium sized accounts band together to make it stop, it is mutually assured destruction. Anyone can band together with anyone else and allocate power from their account to someone else. The super majority of people are good natured and want free speech and band together to combat against abusive/bad actors, of which there is only a handful on steemit and there is no issue at all
synctext 9y ago
> Now, this sounds kind of pyramid-y Unlimited money creation is never sustainable, history shows. An online attention coin can't change economics. The future of television probably is not build on a high inflation economy or destructive hyperinflation. https://scholar.google.com/scholar?q=high+inflation+~economy https://scholar.google.com/scholar?q=high+inflation+~economy
- DennisP 9y ago
  It sounds like they're not trying to create general-purpose money. They've made a token to track influence. They use inflation so old stored influence loses half its value every year. You can't rest on your laurels, if you want influence you have to have provided value recently.
  - truthforce 9y ago
    You are completely wrong, and the above people, about steem doubling every year for the total amount, it only increases by something like less than 10% per year.You or someone above you linked an article from 2016 that has very outdated information. I figured people here might actually do any amount of research instead of just saying vague statements like "resting on your laurels". You have no idea what you are commenting on because it is 2 year old information, but you are acting like an expert. Pathetic.
  - erikig 9y ago
    I’ve been a fan of half-life based ratings/reviews because they allow improvement by increasing the weight of recent input - this feels somewhat similar.
mihaifm 9y ago
Just curious...how do they implement inflation? Do they just double everyone's wallet every 2 years, or do they introduce the new coins through mining?
- Kiro 9y ago
  It's mining but most of the mining rewards are distributed to content creators and only 1 out of 20 blocks are going to the actual miner while 19 go to the witnesses (Delegated Proof of Stake).
osteele 9y ago
It's interesting to compare this with HN karma. Karma is similarly inflationary, for the same reason: HN would incentivize a very different kind of dialogue if you only gained karma that someone else lost. The difference of course is that there's not a market that I know of for buying into or cashing out of karma, although it's easy to imagine how this could emerge.
- otoburb 9y ago
  Karma is inflationary, but not in the same monetary sense because karma-as-a-signalling mechanism is more valuable precisely because they cannot be traded between accounts. I guess using the popular blockchain buzzwords of the day we should be calling karma a type of "proof of valuable comment history".

truthforce 9y ago

It is proof of mind, and there are no miners anymore. By posting and someone upvoting you they are allocating the rewards that the steem witnesses generate. Witnesses all run servers and are chosen by democratic votes from all steem users to represent steem. The list of current witnesses who have power changes from time to time. Someone who was in power last month might not be in power for a few months as it changes between witnesses, giving an actual chance of getting rid of bad actors, whereas in proof of work mining there is 0% chance of taking out a bad actor as the miner owns their equipment and there is nothing you can do. There is a lot more you need to read and that is ok, you barely have any understanding of the fundamentals. People are able to allocate their steempower to other users. If large accounts are misbehaving, small and medium sized accounts band together to make it stop, it is mutually assured destruction. Anyone can band together with anyone else and allocate power from their account to someone else. The super majority of people are good natured and want free speech and band together to combat against abusive/bad actors, of which there is only a handful on steemit and there is no issue at all

synctext 9y ago

> Now, this sounds kind of pyramid-y Unlimited money creation is never sustainable, history shows. An online attention coin can't change economics. The future of television probably is not build on a high inflation economy or destructive hyperinflation. https://scholar.google.com/scholar?q=high+inflation+~economy https://scholar.google.com/scholar?q=high+inflation+~economy

DennisP 9y ago
It sounds like they're not trying to create general-purpose money. They've made a token to track influence. They use inflation so old stored influence loses half its value every year. You can't rest on your laurels, if you want influence you have to have provided value recently.
- truthforce 9y ago
  You are completely wrong, and the above people, about steem doubling every year for the total amount, it only increases by something like less than 10% per year.You or someone above you linked an article from 2016 that has very outdated information. I figured people here might actually do any amount of research instead of just saying vague statements like "resting on your laurels". You have no idea what you are commenting on because it is 2 year old information, but you are acting like an expert. Pathetic.
- erikig 9y ago
  I’ve been a fan of half-life based ratings/reviews because they allow improvement by increasing the weight of recent input - this feels somewhat similar.

mihaifm 9y ago

Just curious...how do they implement inflation? Do they just double everyone's wallet every 2 years, or do they introduce the new coins through mining?

Kiro 9y ago
It's mining but most of the mining rewards are distributed to content creators and only 1 out of 20 blocks are going to the actual miner while 19 go to the witnesses (Delegated Proof of Stake).

osteele 9y ago

It's interesting to compare this with HN karma. Karma is similarly inflationary, for the same reason: HN would incentivize a very different kind of dialogue if you only gained karma that someone else lost. The difference of course is that there's not a market that I know of for buying into or cashing out of karma, although it's easy to imagine how this could emerge.

otoburb 9y ago
Karma is inflationary, but not in the same monetary sense because karma-as-a-signalling mechanism is more valuable precisely because they cannot be traded between accounts. I guess using the popular blockchain buzzwords of the day we should be calling karma a type of "proof of valuable comment history".