Introducing a more balanced approach to bidding bots

in #bot3 years ago (edited)

In this post, I will introduce the business philosophy adopted by @slimwhale and why I think it to be an optimal solution for bots across the board.

whale-2221304_640.png

What is a Slim Whale ???

Slim Whale is the silly name I have given to my bidding bot. There are so many variations of the name whale out there, I wonder if we will ever run out 😁 Like most of you guys out there, I am trying to find my niche here on steemit, I have posted in lots of categories, sports, utopian and some crypto posts. Since the very beginning, I have used bidding bots to raise the profile of my posts and to gain something extra on the side. I knew I wanted to own a bot and the result is @slimwhale.

Bidding bots brilliant, but also very flowed mechanism

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The ideea is pretty simple and I am pretty sure most of you are familiar with how this works. Every 2.4h, the bot collects bids, a bid pool is formed and when the voting power reaches 100%, votes are distributed proportional to the bids. So, for example is the total bid pool is 1 SBD, and your bid is 0.2, then you receive a 20% vote. Depending on the round, a bid can have a positive ROI (the bid pool is smaller then the bot's vote value), a negative ROI (the bid pool is too big) or a neutral ROI of 0, when the bid pool size is perfectly matched with the bot's vote value.

Seems like a perfectly fine system, what is the problem then?

I want to start by listing some of the current shortcomings and then expend on the whole ROI thing.

  • Unbalanced rounds, with positive or negative ROI. I will explain why this is bad
  • Lots of last second bids
  • Lots of uninformed bidders, who can ruin a bidding round, by bidding over the limit
  • Bidding is most of the time gambling, instead of just being a service

In the current form, in almost every bidding round out, there is a losing party. If the ROI is negative, than all the participants in that round lose money. Sure, they get some publicity for their post, but giving away hard earned SBD/STEEM is not fun. If the ROI is positive, then the bot owner and all the delegators miss out, basically giving away money and free publicity. So yeah, in this current system, bidding is pretty much gambling, a lot of bids come at the last second and a lot of people are pissed, rightly so.

Make bidding bots great again

In my opinion, the key to improving bid bots is to make that ROI = 0, for all bidding rounds. This way, we create a fair system for all. The bidders get free publicity and the bot makes the most out of its vote. There are two bot characteristics in place right now, that can make this a reality, thanks to the features implemented by @yabapmatt in postpromoter. Those two features are ROI limit and Max ROI. The short version on how to make bidding bots great again is by setting both this parameters to 0%, thus achieving ROI = 0 for each round. Now, for the long story, let's explore these two features in their current form.

ROI limit and why you should take it with a grain of salt

The ROI limit is a mechanism which in theory protects bidders from losing money in a bidding round. So, if a bot has a setting of -10% ROI limit, than the bidding pool value is capped in a way that ensures each bidder loses at most 10%. This percentage varies, some bots have it set of -40%, some at positive values, 1%, 2% and others have no protection at all.

What happens with my bid if the round is full?

At the moment, if you bid and your bid makes the ROI go under the limit, you will receive a vote in the next round. Seems like a perfectly good mechanism right?? Well, it's really not.😅 Let's say you have a bot which has an ROI limit of 0% and a voting value which insures a max profitable bid of 1 SBD. Let's say the current round is full, you bid 0.8 SBD. Another bidder places a bid of 0.3 SBD, which also goes to the next round. So, what happens in the next round? You have 2 bids, totaling 1.1 SBD and the bot max profitable bid is 1 SBD. Where is the 0% ROI limit that was promised? I'll tell where, it's gone, there is no limit. This is just a use case which will need to be addressed by @yabapmatt in order to have a true ROI limit. If you think I'm just ranting, here are some bot rounds which have a 0% or greater limit:

2018-04-03.png

2018-04-03 (2).png

2018-04-02 (1).png

That last one advetises a -10%, but still, -82%... The solution? At the moment, this is just a matter of @yabapmatt needing to fix this ROI limit feature. As bot owners, we can mitigate this, by putting a max limit on bid. So, if your bot max profitable bid is 1 SBD, you should not accept any bid higher than that, right? Slim Whale max bid is 0.08, which is in line with the max profitable bid you can place with my bot.

Another use case which can rander ROI limits useless is bot owner's honesty. In the steembottracker, as a bot owner, you can put one limit in the config and your bot can have totally different running parameters. So for example, one can advertise a 0% ROI limit on the website and his actual bot can have no limit, or a much smaller one. I chose to believe no one does this, as this would be a total betrayal of trust and would merit expulsion from steembottracker altogether.

Max ROI

I go into some detail about this feature in my last post, here. This is a bot owner protection feature. Let's say for a round the bid pool is small, giving each bidder an ROI which is above the Max ROI set. In this case, the bot adjusts the vote weights, giving each bidder a vote with capped ROI. If you go on steembottracker bot details, you can already see some bots which have already set a max ROI for their bots. For a representative example, let's say you have a max ROI of 0% and the bot steem power allows for a max voting pool value to be at 1 SBD. In some round, let's assume we have 5 bidders, each with a 0.1 SBD bid for a total bidding pool of 0.5 SBD. In the old format, with no max ROI, each bidder would receive a 20% vote. In the new format, if the bot has a max ROI of 0%, each voter would receive a 10% vote. This would consume 1% of the bot voting power, allowing it to vote again in 1.2h.

Zero, zero everywhere, but profit for everyone

Now that I have explained both ROI limit and max ROI, I hope you can see why I propose both these features be set to 0. In this scenario, bot users gain free publicity and bot owners/delegators make the most out of their steem power. A huge bonus would be bot usability. Assuring a 0% ROI would eliminate last second bidding. Yep, that's right. If a bot can guarantee this 0% ROI, it would eliminate the gambling aspects of bid voting bots. A user can simply pick a bot and bid, being sure he will receive a vote of equal value. So, no more wasting time on steembottracker, hunting bargains, which most of the time are ruined by last second bidders, or by uninformed bidders which over bid.

Let's talk about @slimwhale, which is championing this approach

I am @prometheus21 and I am the owner of @slimwhale. This is a relatively new bot, about a month old. During this time, I have experimented with ROI limits, no limits, and studied what other bots are doing. I believe this to be the optimal approach, a bot which simply offers free publicity, with no ROI, negative or positive. As a bot owner, I don't want someone to lose money using my bot and conversely and don't want to be give away free money. If I give away free money I do so, by reading the content and upvoting, in a classic steemit way, and not by setting up this bot. At the moment, I have a 0% ROI limit, which means, usually (see my explanation about ROI limit), bidders are not losing money by using @slimwhale. The max ROI I have set it at 1%. It is not 0% because this is still beta feature and 0 usually has a funny way of causing bugs. As soon as @yabapmatt makes this feature public, it will be at 0%.

Invest in @slimwhale

I talk about investing in both my previous posts, here and here. At the moment, @slimwhale shares 100% of the voting pool profits with delegators. This being a zero ROI bot, you can calculate more easily the expected revenues from a potential delegation, as the daily payouts should be less variable. I have implemented this zero sum approach for about a week and payouts have been pretty consistent. As an example, a 100 SP delegation should net you about 0.06-0.07 SBD daily, which is not bad in my opinion, considering current STEEM prices.

Final thoughts

Well guys and gals, I just presented you with what I believe is a fair system for bid voting bots. I paint quite a different picture compared to the classic bid voting bot, which I believe to be an imperfect system. I eagerly expect your views. Would you use a bot which guarantees this 0% ROI?

Sort:  

Every 2.4h, the bot collects bids, a bid pool is formed and when the voting power reaches 100%, votes are distributed proportional to the bids.

With the 0% ROI setting, is rule above still relevant?

Nope, it is definitely not relevant anymore. I was just explaining how the old system worked

This sounds quite interesting as I am struggling to find out what all the specs mean. You break it down really well. Still a little more than I can relay to someone else, however looking forward to trying out this bot. Thanks!

You got a 10.47% upvote from @slimwhale courtesy of @prometheus21!

Did you know you can make a passive income by simply delegating steem power?
@slimwhale offers the best return on your investment, sharing 100% of the bidding pool rewards, daily, proportional to your investment.
Let's grow together, start earning now by clicking the following links: 10SP, | 50SP | 500SP, | any amount |
For more information, see here or join me on Discord

Also, is there much of a difference in sending either 0.01SBD or 0.01 Steem in percentage of vote?

Well yeah, of course. It depends on the dollar value of SBD/STEEM at that moment. For example, if steem is worth less, the vote percentage is also smaller because you have send less money ( 0.01 STEEM being worth less than 0.01 SBD).

Oh okay, thank you. I'm still trying to understand it all.

This post which has a payout in excess of $50.00 has utlized one or more bidbots.

postpromoter payout in the amount of $35.69 USD.
smartsteem payout in the amount of $7.34 USD.
booster payout in the amount of $1.76 USD.
buildawhale payout in the amount of $8.58 USD.
honestbot payout in the amount of $0.76 USD.
slimwhale payout in the amount of $0.16 USD.

This information is being presented in the interest of transparency on our platform.
Please consider the long term effect on our platform before using bidbots!
You can read more about how bidbots are affecting our platform here.

@slimwhale, The community appeals to you, please help build a great platform by posting quality content and letting the community curate you work.

Please consider supporting @transparencyBot by upvoting this comment.

Thanks for your informative post about bots, @slimwhale! I always check for bots with lowest ROI limit. I would definitely use 0% bot! Keep up, friend. Followed :)

Glad to hear I am not the only one 😅

Good post, thank you.
It's very educational.
I'll definitely try out your bot. ;)
Good luck!

Happy bidding!

You got a 85.51% upvote from @slimwhale courtesy of @prometheus21!

Did you know you can make a passive income by simply delegating steem power?
@slimwhale offers the best return on your investment, sharing 100% of the bidding pool rewards, daily, proportional to your investment.
Let's grow together, start earning now by clicking the following links: 10SP, | 50SP | 500SP, | any amount |
For more information, see here or join me on Discord

To listen to the audio version of this article click on the play image.

Brought to you by @tts. If you find it useful please consider upvote this reply.

It frustrates me that people dont do some research to understand how the bid bots work before using them!

I often bid nearer to the end looking at a +ROI and then someone comes in and bids way above the reccomended bid and makes it go way -ROI. Its out of my hands but frustrating because in this case it affects all other bidders

It is frustrating indeed, as you don't need to be ill informed to lose. Some bids come so late, even an informed user might end up with a negative ROI. This is what my 0% ROI proposal aims to solve. Sure, you don't get to make money, but you don'y lose either. A compromise I believe it's worth considering.

Thank you, happy bidding!

Well majority of bot users are looking not for free publicity, but for max ROI. I have seen small powered bots with capped ROI sitting without any bids at all though their power was at 100%. This is also a loss for delegators. Eventually such bots may have less interest, because they will constitute one way profits, that is profits only for owner and delegators.

I am thinking of implementing an automated solution if the bot remains without bids, stuck at 100%, of just upvoting a random delagator post. At the moment, and I am not ashamed to admit it, if the bot is stuck at 100% with no bids, I just upvote a bot comment and so it becomes "unstuck". This is obviously not a long term solution, but it's better than the old uncapped version of giving a 1000% ROI vote.

It may be the fact that small bot market has reached a kind of saturation, we will see what happens when more and more bots cap their ROI.

Isn't upvoting a bot comment same waste of delegators money as offering vote rounds with high ROI? What if delegators are using Steemit only to gain profit by renting SP and not making any posts? Then they will also loose when idle bot will not have any post to upvote.

I've just checked 5 random bots with 0,01 SBD minimum vote. All of them were uncapped and did from 40 to 570% ROI in their last round. 90% of bidders will choose bots with possible ROI over bots with no ROI. How will this reflect to delegators profits?

I have concerns as @slimwhale delegator. This is not bold criticism :)

You are right to have concerns :)
Here are some directed responses:

  • Uncapping the ROI is not a good solution. The bot profits then(when I had uncapped ROI) were about 30% of what they are now. I hope this gives you an answer about how much a small uncapped bot makes. The delegators are much better off now. I don't have any solid data to back this up, but I believe @slimwhale is one of the most profitable small bots out there, mainly because of the cap

  • I would not care so much about giving high ROI votes, were it not for the fact that @slimwhale runs with leased SP. Let me explain this to you. At the moment, @sliwhale has 1,376 SP in total with 1,357 SP delegated. There are 4 delegators to @slimwhale: myself(316 SP), you with 20SP and two others, with 10 SP each. The rest of the SP, I have leased using minnowbooster and will expire in a few weeks. So I have paid to lease 1000 SP with my own steem, hence each time @slimwhale gave a very high percentage ROI, that steem was literally paid by me.

  • Which brings me to my last point, the self voting when the bot is idle(fortunately a rare occurrence). Yes, this is a temporary solution, I am trying to think of something better, like giving votes to delegators, which I am sure would be a very interesting value proposition. The problem is distributing those votes fairly between delegators. As I am currently responsible for delegating more than 95% of the bot SP, yeah, I am self voting, guilty as charged :)

Just as I expected. From all the bots @slimwhale is the only one sitting without any bids and wasting delegators SP.
I am thinking of cancelling delegation in next 24 hours, as this is not a way to profit.

Screenshot 2018-04-04 10.06.16.jpg

Cancel away, explore other bots. If you do cancel and delegate to other bots, please report on Discord what are the earnings the "competition" is making, I am genuinely interested

I am thinking of upvoting my own comments, since my upvotes will be worth 0,004-0,005 $ x 20 comments. Just need to continue to be active Steemit member.

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we get 60% of the value from our posts, so ....0% should actually be at max. 60% of total value

You just received a 91.99% upvote from @honestbot, courtesy of @prometheus21!
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