Why is the Steem Price Low? How Do We Fix It?
Will you please read this post if you care about the future of Steem because what we see here is the most important issue we are currently facing for Steem? If we seriously hope for our blockchain to continue to grow in value and to continue to attract more investors, more authors and more users, we either need to take care of this in the next hard fork or sell today before the price goes to $0.
Why is the Steem Price So Low + How Can We Fix It?
The simple reason the price is so low is that the demand to buy Steem is much less than the supply from sellers willing to take any price for it. While we cannot fix most individual issues related to why Steem is bought and sold, we can make one change that will remove a huge reason that investors sell Steem and authors stop posting on Steem.
Flagging Rewards = Millions of Steem Sold = Lower Price
When we imagine Steem with just one feature having been removed, I estimate that the value of Steem today would be closer to $10 instead of a $1 if in the previous hardfork we had made one relatively small change. If we expect Steem to ever consistently grow in value and in daily users, the time is now at a bare minimum to test removal of the ability to remove rewards from a post by flagging.
Blockchain Downvoting = Blockchain Censorship
I am very grateful Steemit Inc just made the following post on their blog named Censorship: Why All Blockchain Projects Should Join Steem (especially Status) because it highlights the vision for Steem (a censorship free blockchain community) versus the reality (a heavily censored blockchain community).
Of course, even if we didn’t want you, there’s nothing we could do to keep you from posting and even earning STEEM!
Part of this is true and the other part is a complete lie. While technically no one can stop you from posting, tens of thousands of people can stop your posts from being visible and from earning Steem unless you stick to a very particular format while following the laws in the USA. In fact, Steemit Inc is delegating millions of Steem power to a project that systematically downvotes mostly new authors trying to get started on Steem while failing to downvote any of the most obvious abuses. While this is rationalized as "being there to protect the rewards pool" the obvious reality is missed that one's idea of a post unworthy of earning rewards is based largely on culture.
Most Authors Start with Crap and Get Better.
On top of that, most people's early creative efforts are crap which then gets called spam and gets downvoted here. My first (and some would argue recent) videos online were ways to say the f word. My first website was incredibly ugly. My first blog posts were bad. The first posts I made on Facebook were crap. If we do not allow authors to start with crap and still earn rewards, we are killing off almost all of the seeds that would later grow into valuable contributions.
That said, Steemit Inc's delegation to a project downvoting mostly minnows collectively for hundreds of dollars a day is the tip of the iceberg. Several big Steem power holders spend the majority of their time "killing accounts" and trying to shut up authors like me that post anything potentially disagreeable. YouTube offers way less censorship than Steem does today because only YouTube can remove earnings while anyone with Steem power can go take money away from anyone else.
My last stand up comedy video on Steem was a perfect test case here to demonstrate that censorship is alive and well on Steem. This censorship is ruining the potential of our blockchain for investors and authors. The price today makes that clear and it is time to stop blaming it on the Bitcoin price and start considering what we can do about it.
Downvoted Investors + Authors Eventually Sell Everything
Our authors and investors collectively have sold millions of Steem instead of buying millions more Steem and powering it up because of relatively small downvotes. While rationally this makes no sense, when we understand that most human beings are predictably irrational everything becomes clear.
Most of us are more motivated by the threat of punishment than we are seeking a reward. Most of us getting downvoted $20 will feel more emotion than we will earning $200 from our posts. Thus when we think about a downvote it feels much bigger than what it was while the rewards then become smaller. All of us that had parents who were willing to hit us if we did not do what we were told understand that the fear of being hit was nearly constant even if the parents did not that often follow through.
Over the last year, I have watched authors and investors like me that were really excited about Steem enough to collectively investment millions of dollars turn around and nearly unanimously sell out usually directly after achieving enough success to get recognized and downvoted. While some held on for months in the face of consistent flags while others left at the first downvote on a comment, over a year nearly all sold AND stopped posting on Steem. This is a big part of the reason why despite having almost ten times as many users today as a year ago, the price of Steem remains about the same while the daily number of posts is actually dropping as seen at https://steemit.com/steemit/@penguinpablo/weekly-steem-stats-report-monday-june-25-2018.
Solution: Move Downvoting from Blockchain to User Interface
The #1 argument in favor of keeping downvoting is that we need to regulate the content posted to Steem which I completely agree with. We want to encourage high quality content and discourage spam, plagiarism etc. When we do this directly on the blockchain with rewards, we are creating a community of censorship where any stakeholder can simply take money away from anyone else for any or no reason while user interfaces then are forced to respect what happened on the blockchain.
The call to action I'm suggesting is that we immediately remove the ability to downvote from the blockchain and move it into each individual user interface such as https://steemit.com, https://busy.org, https://dlive.io, etc. because this gives us the majority of the benefits we get out of downvoting while removing nearly all of the downside in terms of the value of the community and the Steem price. Meanwhile, trying to exert power and control on the blockchain becomes very difficult without downvoting but easier on an individual user interface.
Blockchain Downvoting Empowers Hate, Drama, Discrimination, Bias, and Racism
Did I throw in enough words to get your attention because this is the tip of the iceberg? With blockchain downvoting being completely out any centralized control compared to doing flags by user interface, we allow for everything we dislike to be used as a criteria for being downvoted.
Don't like someone's skin color? Downvote them! Dislike someone's religion? Kill off their account with downvotes. Hate a certain sexual orientation? Silence their voice with a downvote long enough and they will leave. Want to discriminate against posts promoting a certain cryptocurrency or using a certain bid bot voting period? Flag the rewards and teach those bastards a lesson!
Top Stakeholders Spending More Time Downvoting Than Upvoting?
When you realize every one downvoting my recent stand up comedy cared more about trying to teach me a lesson than giving you an upvote on your post, then we see the real problem. Allowing any downvoting on the blockchain encourages people having a bad day or drunk at a party trying to show off or on some righteous path to pour time and energy into figuring out which posts to downvote instead of which posts to upvote.
Despite only having downvoted a few posts myself, I have thought about it a lot. I have imagined who I would downvote and how they would feel. I have even considered launching a downvoting service and imagined how awesome it would be to watch the anonymous transfers come in and then lay big downvotes on people otherwise immune to direct downvotes out of fear of retaliation. In considering the total time spent, it seems today most of the big voters actually are spending more time reading and talking about disagreeable posts than focusing on finding and upvoting quality posts.
Blockchain Downvotes = Voting Bots
When investors try to post and get downvoted, the logical solution is either to sell or delegate to a voting bot to get the highest return. In theory, it seems good to try to take rewards from those posting ten times a day and upvoting themselves until we consider the bigger picture. What if the posts from those self upvoting ten times a day add a lot of value to the blockchain? Why not just let someone take their $300 a day payout instead of downvoting them to $100 a day when they either decide to sell their $300,000 worth of Steem or delegate it to a voting bot?
I estimate the delegations to voting bots would be a fraction of what they are today without blockchain level flagging while the amount of posts on Steem would be five or ten times higher as more authors simply upvoted their own posts and naturally over time upvoted others following them too.
Speaking Out Against Downvoting = Flag + Witness Vote Removal
In theory we should be able to have a rational discussion about this where we compare the pros and cons while sharing our experience. In reality, when we even start talking about getting rid of flagging on a blockchain level, we immediately get downvoted. Within minutes of mentioning that I was thinking about making a post about removing downvoting, I lost a huge witness vote which dropped me out of the top 20.
Fear of Downvotes and Losing Witness Votes = Silence
If all of this is not bad enough, even as fearless as I think I am, my self centered interest in making money guided me for a year to keep my mouth shut about downvoting even as I saw it wreck accounts of those I loved including my own wife. After around two months as a top 20 witness and a friend's desperate pleading with me to see how toxic his experience of being flagged was for his future on Steem as an investor and author, I finally got the courage to speak up on behalf of all of us with the certainty it would immediately cost me what was at the time $500 a day in witness rewards earnings.
How many of our witnesses are willing to lose $500 a day to speak out against a feature that many of the top witness voters love using to exercise power and control on Steem? I decided to do it because the pain of keeping my mouth shut was greater than the pain of giving up the money.
Protest by Selling Steem!
Most of those with a lot of Steem power I have talked to and watched downvote have no interest in anything I have written here or any of the experience of other authors on the blockchain. The general feeling is "I can do what I want with my Steem" and "Having a lot of Steem power gives me the right to do whatever I want." After my experience seeing clearly that these stakeholders make it clear to the top 20 witnesses that any public disagreement leads to having a witness vote removed, how likely is it that the witnesses will agree to this change when considering the possibility of joining me in the lower ranks without the 260 Steem power a day a top 20 witness gets?
Therefore our best option to communicate how much we disagree is to power down and sell Steem to lower the value as much as possible to motivate those holding on forever to make whatever change is necessary to keep the people happy and to allow those buying in to have more influence per dollar invested. I have been powering down and selling for nearly two months now prior to making this announcement and intend to sell all the rest of the Steem I have bought (about 40,000 more) this year until the ability to downvote on the blockchain is removed.
Ready for Change!
For the first time in a year, I am opening myself up to being attracted to another blockchain which has similar functionality to Steem without allowing downvoting. If another community presents a better opportunity for free speech on the blockchain and good rewards for authors before Steem removes the ability to flag from the blockchain, I will sell all of my Steem and use my blog here to exclusively promote that competitor. I already know of several other top authors here that have left, are in the process of switching, or will leave when a better opportunity comes along. When the critical threshold is reached, that is game over for Steem regardless of smart media tokens because Steem itself has to be a success story to attract the use of a SMT and if a competitor is easy to clone on another blockchain, why bother with a SMT?
A Deeper Look on Video
I am releasing the video above on YouTube today to help anyone on YouTube see what the biggest problem is with Steem today and how we can fix it. An upcoming post will feature an edited transcript of this video and help us continue the conversation further.
Fix It or Fail
We will act quickly together to get rid of downvoting on the Steem blockchain or Steem will fail to achieve everything it was setup to accomplish in being a platform free from censorship where our voice has value. As it stands today, Steem is a heavily censored blockchain where those with the most money make nearly all of the new Steem and actively collaborate in silencing the voice of anyone disagreeing. Anyone that speaks out or shares a truth that offends any big stakeholder is subject to losing everything which makes this a community inferior to all of the ones it attempts to be better than.
I refuse to continue helping a community grow which will not act in the best interest of the majority of its authors and investors. I am committed to continue the conversation on this until either we make the change or I run out of Steem power.
Where Can We Be Free to Share, Connect, and Earn?
I am imaging a future where a blockchain empowers us globally to each share our voice without fear of loss from downvotes while each user interface makes decisions on what to show to readers. I am seeing people everywhere grateful to earn enough on this blockchain to support a family and be free from oppressive work and governments.
The question is will this blockchain I see be Steem or will we stubbornly refuse to change and leave Steem behind for something better?