Proof-of-Brain or Power-of-Bid(bot), that is the question.
Repository
https://github.com/steemit/steem
We will look at the status of bidbot business in detail and check the recent significant changes.
This will help us to better understand the current status of the bidbot business, as well as the basic problems and additional problems caused by recent changes.
I analyzed the data from the start of the STEEM chain, but most of the data focuses on 2018, as the bidbot business itself is mainly expanded in 2018.
Aim of Analysis
Detailed bidbot Business Status
Recent remarkable changes
Conclusion
1. Detailed bidbot Business Status
① Daily trend of SP delegation size to bidbots
In 2018, the bidbot business grew dramatically. The amount of delegation of SP (indicated by blue bars) to bidbot was steadily increasing, reaching about 22.33 million SP at the end of the year.
However, for the continuity of the analysis, I recently calculated the above chart based on the bidbotlist of @paulag. There are some more accounts that have actually started the bidbot business, such as @ocdb recently, and there are quite a few unknown manual bidbots, so the actual size of SP delegated to bidbot may be larger.
Looking at the daily SP delegation scale (indicated by the green bars), we can see that there was often a large amount of SP delegation. Who these people are covered separately in ②.
The number of accounts that have delegated SP to bidbots is also steadily increasing.
② Major accounts with lots of SP delegation to bidbots
The well-known freedom account topped the list with about 6 million SP bidbot.
(Including the SP delegated to ocdb, it actually increases considerably over 6 million SP.)
The second place is the blocktrades account which delegated approximately 3.12 million SP. In early January of last year, he was the first to delegate a large number of SP, which led to the beginning of the bidbot business.
In addition, frystikken, who introduces himself as a co-founder of STEEM, delegated about 700,000 SP, and even smooth witness delegated more than 700,000 SP to bidbots through smooth-a, smooth-b.
When you look at ned's remarks, "Use bidbot to promote your articles", the bidbot delegation status of key accounts in the STEEM chain, and the flow of funds in the bidbot, the bidbot is actually closer to the official business of STEEMIT, INC.
③ Current individual sizes of Bidbots
The percentage of SP delegation to the top 4 bots is 52%.(smartsteem: 15%, appreciator: 14%, therising: 13%, booster: 10%)
Other major bots are buildawhale(8%), upmewhale(7%), upme(7%), rocky1(7%).
For reference, the SP owned by the bidbot accounts was very small, mostly delegated. Please refer to the table below for the details of the current SP delegated by bidbot.
④ Trend of the proportion of reward that BIdbot business takes
The proportion of curation rewards that bidbots took (in the narrow sense) was about 20.4% on average last year and seems to be in a slightly increasing trend. At the end of the year, it was 22.4%.
Articles with the help of bidbot (in the narrow sense) got an author reward of 32.1% per annum and 34.7% at the end of the year.
This number refers to the author's reward of the articles that bidbot has voted for, not the weight taken by bidbot. It is actually a more useful number to check how much compensation is being paid to bidbot users.
In short, the author reward in the article using bidbot is 34.7% of the total, more than 1/3.
2. Recent remarkable changes
① Minor changes
- Increasing trend of delegating one account to multiple bidbots
As of the end of last year, one account has an average of 1.05 bidbots delegating SP. Perhaps there are a variety of bidbots and their expected returns are different.
- Average delegation SP per bidbot declining trend
In the early days, mass delegation of several accounts was dominant, but the average delegation SP per bidbot is declining as many accounts are delegating to a relatively small SP. It also appears to be partly due to the tendency for one account to be delegated across multiple bidbots.
② A whole new change: expansion of Vote-Selling
By approving bidbots for some use of voting rights instead of delegation, Vote-Selling is expanding because it has the advantage of being able to vote directly from time to time, while generating similar profits to those that actually delegate SP.
This is a very important change. If this is enlarged, it will be very difficult to verify that the post is using the bidbot.
It is estimated that the specific bidbot's share of income earned from Vote-Selling is close to 40%. The size of Vote-Selling is also increasing with the growth of the bidbot business.
All figures in this article are accurate, but not as accurate as the above estimate of about 40%.
To make an estimate, if a particular account did not delegate an SP to this bidbot, but bidbot sent an amount in excess of 0.01 to that account, it was assumed to be Vote-Selling and the duplicate amount was removed. However, due to the incompleteness of the STEEM memo, the error may be mixed.
More importantly, the size of Vote-Selling is increasing, and this is not captured by the usual bidbot statistics to date. Given this, we can see that the bitbot business actually flourishes more than the bidbot business in the narrow sense.
③ Whatever the name, the bidbot-like scheme (in a broad sense) is also on the rise
Whatever its name and format, such as a ResteemBot, an account for paying membership fees, a scheme that sends a certain amount of STEEM / SBD first and receives its equivalent in voting is logically similar to the bidbot business in the narrow sense.
Also, the schemes to vote for a value similar to the bidbot in proportion to the SP delegated by the non-existent Dapp seem essentially the same.
In this way, the proportion of the reward that takes away from the bidbot-like business of Vote-Selling and whatever its name seems to be quite large. If all of the bidbots are running the Vote-Selling system in full swing, the impact will not be negligible.
3. Conclusion
※ This article is mainly aimed at checking detailed statistics about bidbot business. The following conclusions are included in a temporary opinion of an individual.
① Proof-of-Brain or Power-of-Bid(bot), that is the question
The narrow bidbot business takes more than 20% of the curation reward, and the reward share of the articles using the bidbot is already more than one third.
Moreover, there are a lot of articles that use bidbot (in broad sense) recently. There are many articles that use Vote-Selling, which is difficult to know whether to use bidbots or not. In sum, the articles that account for up to 4 ~ 50% of the total author reward are directly or indirectly the bidbot effect.
Even most Dapps are in the process of blacklisting and sharing to filter out bidbot users in a harsh situation with only development progress.
Looking at the present, STEEMIT's philosophy is no longer a PoB system as an abbreviation of Proof of Brain, but a PoB scheme as an abbreviation for Power of Bid (bot) may be more appropriate.
In fact, the rewards of a STEEM chain are like a kind of well that should be paid to those contributing to the value creation of the STEEM chain.
The more we give to those who pay some extra costs for our wells, such as through bidbots, the fewer rewards will be paid to those who contribute to the value creation of the STEEM chain.
As a result, STEEM chain contributors will have to slow down the rate of increase in compensation, so bidbot delegators will be able to maintain the STEEM number of returns in the short term, but the loss of the STEEM value itself is inevitable.
In addition, it creates an external diseconomy effect that leaves STEEMIT with a sense of alienation from damage to trending pages.
This has already been proven by the fact that last year's STEEM price, which had been on a continuous increase in bidbots, was much lower than the BTC decline.
The number of active users is similar at the end of 2018 or at the end of 2017, but at the end of 2017, the STEEM price averaged US $ 1, but now hovering around US $ 0.3.
If a small number of large whales and some investors focus on bidbot deleagation revenues as STEEM purchasing costs are virtually zero at present, the demand for contributions and value creation will decrease and the STEEM value will fall to the level of profitability of a normal PoS coin. It is similar to purchasing a master node.
The bidbot operators mainly focus on the "visibility" of the post as the main reason for activating the bidbot business. However, when "visibility" is required, it is extremely limited.
If we can enjoy a greater level of welfare from the perspective of the entire participant, it is a reasonable direction to go there. In the short term, there may be a decline in revenues for SP delegators, but in the long run it should be recognized that it is more beneficial to their STEEM value.
In economics, it is called Pareto improvement. Innovation is needed to ensure that more rewards are distributed fairly to the various people.
② This issue requires innovative implementation of the system
But as easy as the bidbot business, pursuing higher returns is more like human nature.
Investors who have already seen losses may have experienced some of the limitations of expanding the bidbot business, but those who enter the present price will also be easily tempted by the bidbot. It is a vicious cycle like a band of Mobius. The current STEEM price that the haircut was carried out by the collapse of the design proves it.
In the end, bidbot has come to the point that it is difficult to improve by participants' good will or future alternative.
This is one of the causes of almost all problems in the STEEM chain.
So IMO, I love the unlimited freedom and decentralization philosophy of the STEEM chain, but I think the schemes that prevent bidbots, Vote-Selling, and Circle voting should be implemented technically in a blockchain unit.
Of course, it would be difficult technically and in terms of SP stake structure.
It takes too long for new incoming users to feel all the attributes of the STEEM chain and to think and agree on it. Moreover, human thoughts are different.
If not, this problem can continue to anchor after Dapps grows.
Thank you. Be more happy in 2019.
The Data and Queries
I did this analysis by connecting to the @steemsql db with MSSQL client(Microsoft SQL server management studio), Excel.
Refer to My Github
(My recently analysis)
Analysis of Voting Pattern: From posting to payout
SBD Debt Ratio Management Trend Analysis : Who removed our SBD?
(STEEM) All we need is time? Nope. More innovative action is needed.
The current (actual) inflation rate of STEEM is quite different from the design.
STEEM status and some doubt, based on account creation statistics
Hi @lostmine27, great work! It is very impressive to see how the delegations to bidbots evolved over the year. In times of mostly decreasing activity on Steem, the bot business seems to be one of the few aspects that see a continuous grow despite the low STEEM price.
Getting reliable numbers on the vote selling is tricky because smartsteem and minnowbooster both allow users to keep their balance at the bot, so there is not necessarily a blockchain transfer involved, and the transfer history of the bots include a lot of unrelated stuff. But I think your numbers should be mostly correct.
For the sum of SP delegations I was a bit surprised that it works out by simply summing up all delegation op amounts to the bots. I cross-checked the numbers and the current total SP delegated to the bots ends up at around the same number. I would have expected a larger impact of un-delegations and re-delegations, which are not explicitly handled by your approach if I understood it correctly?
Your contribution has been evaluated according to Utopian policies and guidelines, as well as a predefined set of questions pertaining to the category.
To view those questions and the relevant answers related to your post, click here.
Need help? Write a ticket on https://support.utopian.io/.
Chat with us on Discord.
[utopian-moderator]
I know the problem of estimating the size of Vote-Selling and have already left it to the post about the limit. But I have heard from you that minnowbooster is also running the Vote-Selling system. Thanks for the info.
It was a little difficult for me to calculate the daily SP delegation trend in terms of idea, but I was glad to find a way. It is a good idea to study the status and impact of un-delegation and re-delegation. Let's check it later.
Be healthy and more happy in 2019, @crokkon!
Thank you for your review, @crokkon! Keep up the good work!
This is incredibly great work! Thank you for sharing...
Thank you. Be healthy and more happy this year.
Cheap/free downvotes are the answer (or at least, the best chance at an answer that I know of; I am not sure that even that will work, but consider it worth a try). It won't make sense to pay for votes when those votes can be easily downvoted if merit doesn't support it.
Until this happens, nothing will change, except that matters will continue to get worse.
It doesn't happen (yet?) because of a combination of people who are misguided and think 'toxicity' is a reason not support downvotes and those who profit from the existing system (including those who profit and spread the 'toxicity' myth to obstruct change and protect their own interests).
Either this gets fixed or we can just ignore the concept of voting for rewards and build other value on top of Steem. There are plenty of ways to do the latter. For example, consider Steem Monsters, which has nothing to do with voting at all. (But in that case we should really just disable the reward pool so that unnecessary growth of the blockchain size and cost due to pointless bidbotting and vote selling is avoided.)
Cheap/free downvotes are the answer. Agreed.
the absence of brain or heart/creativity is the biggest harm one could do to this plattform. We have 5000 daily users on steem(it)...world wide, many of them are bots, some are those "nice article"-spammers.
When user number decreases linear, the network looses value to each node exponentialy (metcalfes law). It dies as fast as it can explode in popularity. Due to the assymetrie of few informative or creative and well writen articles like yours and many shit-posts trending on steem(it), steem(it)s value for the end user is really endangered. Im happy about some flippening in the whale space. Because we need invested users and no whales. resteem. PS. delegation is great way of sharing resources if it happens between humans.
Thank you for your honest and insightful comments. Most agree.
Even among human delegations, it is not easy for ordinary humans to borrow an appropriate APR because some curationbots are borrowed first with high APR.
Best wishes for a Happy New Year.
Great work, thanks. As a consequence, I will remove some witness votes asap.
I am happy to have a small help in your choice. However, the witnesses mentioned have a very important role and need to be approached carefully. I respect your choice.
Thank you. Be more fun in 2019.
This is a really nice piece of work @lostmine27!
I suspect that the BB business is larger than the figures here and in other analysis - vote-selling tough to get a handle on for sure.
Personally, I see the future of steemit.com's trending page as an advertising listing. Those who want to see paid promotion will take a look, and those than don't will be tucked away in their app/community.
So that's trending out of the way, and I guess the other main point is the % of the pool being taken. You mention Proof of Stake - bid-bots are the most effective/easiest way of doing this, and many of the main delegators are early miners. I know for a fact, some don't really want to be in this game, but feel they have to to keep up.
The hope is that there will be alternatives to this business in the future, by way of delegation to dapps for example. Personally, I cant see anything out-earning the result of casting 10 self-votes a day (minus a little to the BB owner), so we will see :)
Thank you for your sincere and wise comments. @abh12345
Currently effective_SP for accounts that have been voted on since 18.12.01 is now 118,649,346.
At the end of last year (in the narrow sense), the SP sum of the bitbots was about 22,334,123, so it seems reasonable that they take over 20% of the curation reward.
But as you say, the actual size of the bitbot business seems to be quite large due to the many bidbots that are not in the list and the existence of vote-selling and bidbot-like schemes.
In particular, it is estimated that the author reward of posts with the help of bidbot will be at least 40-50% of the total. Even if bidbot does not take it all, at first glance, we seem to feel the influence of bidbot more intensely.
From a long-term perspective I agree with your point of view.
In fact, the cost of decentralization is harsh. It takes a lot of time.
I hope that the principle of autonomous ecosystem for commons proposed by Elinor Ostrom will work better gradually in the STEEM chain. Although it can not be perfect.
Be healthy and more happy in 2019. :)
abh12345님의 utopian-io: Weekly overview of the Analysis category - Week 52/53, 2018/2019
Great article!
Indeed ... Maybe you are interested in reading my ideas concerning circle- and self-voting? One could for example think about ...
... a reward curve which started as n^2 / exponential (thus flat), and then later changed into linear which would work against self-voting as well as excessive rewards (by using spline interpolation the curve would look better but it's the idea which matters).
@clayop had a similar idea.
... implementing diminishing returns when upvoting the same accounts (including own ones) again and again.
... reintroducing the restriction to four (or less) full paid posts per day (from some hard forks ago) which was very reasonable.
Wow thank you @jaki01.
I knew it roughly, but I was able to see it again through the posts you gave me. I have learned a lot and I think it is a good reference for many people.
Be healthy and more happy this year.
Best wishes to you, as well!
(STEEM urgently needs real, friendly, 'normal' - in a positive sense - people like you, who are still reading stuff and thinking about improvements. I hope the power of the 'middle class' will increase fast, that's really necessary to make this place more pleasant again.)
I also wrote on the "diminishing returns" algo well over a year ago. It remains my favourite method as is easy to encode on the blockchain. I did have discussions with SteemitInc at the time but it went nowhere as was considered too computationally costly.
I also did some work on vote-rings and it is mathematically possible to distinguish such rings from, say, a group of friends. In this case, it requires some "sentinels" to "search and destroy"; unfortunately the "destroy" part is limited to downvoting, which is wasteful and ineffective. As Vitalik mentioned about this, that the penalty must be greater than the gain, else it is not a deterrent and is seen as a small tax on income.
What a pity that Steemit Inc. didn't listen to your advice.
I suggested it, too, in some comments, but probably I am not 'famous' enough to deserve any answer. :)
I think these things go in cycles. We now seem to be in a phase where many ideas are put forward and some will be fully developed. Sometimes it's just catching the fair wind :-)
Good article, and good to highlight that the vote buying/selling is also mathematically similar to bidbots. Indeed, both are just the consequences of the economic code of the Steem blockchain.
We have headed into an attractor that will be difficult to pull away from without some changes to the underlying economy. However, we must think carefully about how to do this - so as not to make it worse - and to distinguish between coin creation and distribution.
If anybody wishes to discuss this in depth then feel free to DM on Discord or join the steem-economy chatroom on SOS Discord server - or in comments here, of course :-)
These numbers make me sad, but they are the logical consequence of a flawed system that rewards these actions. What we need is to move towards a system where delegating to bid-bots is not the best way to earn an interest on a Steem investment with little effort.
While I was and still am sceptical about 50/50 author/curation rewards, this would certainly incentivise curation over self-voting and vote-selling.
Then, we would need pre-curation trails instead of curation trails, for example if @utopian-io would vote with a low-SP account - let's call it @utopian-voter - and follow this vote with @utopian-io 5 minutes after, curators could trail the @utopian-voter account and reward good content while earning good curation rewards at the same time.
Thirdly, we need more projects raising funds through delegations. Even though ICOs are called "dead" by some, on Steem we have the unique possibility to raise funds through delegating SP without loosing the initial investments. When delegations are used for auto-voting their delegators like @dstors does I am very sceptical about that, but if delegations are used for manually curating content authored through these emerging dApps like on @steemhunt and @travelfeed, this benefits Steem, these projects and delegators who will receive SMTs for their investment which could be worth more than the STEEM they are getting from bid-bots.
Ultimately, SMTs will bring the opportunity to reinstall proof-of-brain not for STEEM, but for a range of new tokens that each have their separate rewards pool: If the project account behind the SMT holds e.g. 25% of the total funds and uses it for actively curating the best content once a day, this brings huge curation rewards for votes that come in before. SMTs could also choose a 50/50 split in author and curation rewards, effectively making curating more profitable than self-voting.