Six Months of Steem Power Distribution

I have been a Steemian for just over 6 months now. When I first joined, the hot button topic was a perceived rampant inequality which was only getting worse. Investigating further for a couple of weeks, it was clear the opposite was true - in fact, there was a rapid redistribution occurring at the top, where whales' stakeholding was falling fast. Said rapid redistribution was short-lived - let's find out what happened next.

This post will look at six months of data from Steemd.com's Distribution page. While some of my earlier posts focussed on the Active metrics, this long term look will focus on "All Accounts". Note that this includes bots, investors, aliases, silent observers - the whole lot. However, since the numbers are stake-oriented, they all matter for the overall economy, if not necessarily direct impact on Steemit.

All data is collected manually. That may seem like quite a waste of time and effort - why not simply automate it? My intention was to tell a story - go through the months and find out exactly what was happening, make a note of the events that may have influenced changes in distribution trends. Needless to see, it'll be full of speculation. In hindsight, yes, it was too much work for proportionately little value - though I remained committed to see the six months out. I'd invite the talented Steem developers to make a distribution trends chart - it would be a nice fit for web apps like Steemdb.com or Steempunks.com.

So, let's get down to how it all happened.

TL;DR - What was a rapid redistribution in Mid-2016 sped up further, before slowing down to a crawl towards the end of 2016. It has since picked up pace once again following Hardfork 16.

---

Whales

Needless to day, the whales' behaviour would have the greatest impact on overall Steem Power distribution. Each change here would rippled down to the other tiers. From July to August, whales were powering down and selling at a steady pace, dropping over 1% every month. As the price of Steem started to decline in September, more whales joined in and the whales' stakeholding plummetted. By October, the whales tier held 60% stake - down from 65% just 3 months prior.

It wasn't a straight decline however, there were two anomalies. A couple of users saw the declining price as an opportunity in and powered up to whale status in early September. Later in the month, @steemit vested two accounts with mega-whale stakeholding.

By October, the price of Steem had declined so much that powering down whales stopped dumping, in favour of holding. This led to a temporary plateau in whales' stakeholding.

In November, we saw a very rare increase in whales stakeholding. This was driven by three factors. A low price of Steem combined by Steemit, Inc stating their intent to make widespread economic changes encouraged investors to power up - indeed we gained 3 new whales during this period. Meanwhile, witnesses published aggressive price feed discounts which encouraged SBD holders to convert to Steem and power up. We gained one new mega whale in this time through a mega conversion and power up.

At the same time, greater investing and excitement about the economic changes led to a temporary price bump, so whales started dumping again. Approaching Hardfork 16, things stabilized at 60%.

With the power down rate now nearly 8x faster, that could bring a hypothetical 8x faster redistribution. The negligible interest for Steem Power post HF16 could also be an active deterrent against holding. However, post Hardfork 16 a surprisingly few number of whales chose to power down - most electing to baghold. As Steemit Inc. employees hold a significant chunk of this tier, there would seem to be an agreement to not power down, so all changes post HF16 would be due to independent whales.

There was indeed a slump the first week, but an interesting trend emerged - the stakeholding would somewhat recover by the end of the week. The price has been relatively stable during this period and we haven't seen much new investment or new whales. What is really happening then, is that some whales are consolidating their multiple Orca accounts into single Mega-whale accounts. Conversely, other whales are transferring stake from their mega-whale accounts to smaller Orca accounts. In the end, it's a bit of a zig-zag pattern between two competing ideas.

In January, however, the decline has picked up, reaching an all-time low at 58.36%. We have seen 2 whales drop away from whale status down into the Orca tier. Six months ago, whales held 65% of the network, so that's roughly 1% drop in whale stakeholding per month. Not as rapid as many had hoped for, but a steady and sustained decline.

---

Orcas

Of all the stakeholding tiers, the Orcas are the most curious of the bunch. They barely saw a change throughout the last six months, yo-yoing around the 24%-25% range. Most users in these tiers are miners and early content creators. The latter are the most likely to be holding. The Orcas continued to increase their stake steadily till early September, when there seems to have been a change in focus in curation away from early (and now highly staked) content creators to newer authors. Since then, it's been relatively stable.

There's definitely some connection with the Whale tier - we often see Orcas being promoted to Whale status, and vice versa. Indeed, the last week saw the greatest increase in Orca stakeholding, mostly driven by the 2 ex-whales who are now large Orcas.

---

Dolphins

Note: Orange is the 10 MV tier; Grey is the 1 MV tier.

Dolphins have seen the most consistent and sustained trend - upwards. We do see some spikes in September, and slight declines in November. The September timing is strongly correlated (Note: Correlation does not mean causation) with the emergence of massive curation guilds. The latter is possibly due to the temporary increase in Whales' stakeholding - squeezing out all tiers by a little.

Over the last 6 months, both Dolphin tiers have gained 40% and 50% stake respectively. That is 7%-8% increase every month!

---

Minnows

Minnows' stake has effectively doubled in the last six months, though gains are always easier when you're coming from such a small pool.

There's once again a correlation in timing with the curation guilds. The 0.01MV contains nearly 10x the amount of users, but in November, the 0.1MV overtook the 0.01MV tier. The 0.1 MV tier consists of many authors rewarded by massive curation guilds, as new users in the 0.01 MV tier would graduate quickly to the 0.1 MV tier. However, since December, the 0.1 MV tier has plateaued out while the 0.01 MV tier is gaining rapidly. I'm not sure why this is - any ideas?

---

Some additional thoughts - Firstly, to be pedantic, the post is really polling VESTs distribution rather than Steem Power. So how are these changes happening?

1. Powering Up/Down - The different tiers power down / up at different rates.
2. Rewards - Differing author and curation rewards distribution among different tiers.
3. Movement between tiers - Users moving up or down between the various tiers.

Hope this post has been helpful and that the series has bowed out on a high.