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Where does the money on your posts come from on Hive? HiveBasics.

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There is a well-structured reward pool in Hive Blockchain and for every block, a certain number of Hive tokens are minted based on the inflation rate.

The inflation rate decreased by 0.01% every 250,000 blocks.

Of the total reward pool, 65% is allocated for Proof-of-Brain(PoB).

What is PoB?

In Hive Blockchain, the user publishes a piece of content, known as an author. There is a voting system that empowers the users of the community to apply their knowledge to determine which one is good content and accordingly determine the value of that content by voting. The voters are called curators. This mechanism, all put together is known as Proof-of-Brain(PoB).

The author and the curator share the post payout in a ratio of 50:50.

HP & Voting

The voting worth of a curator is further governed by the stake-weighted mechanism, which is known as Hive Power(HP) or influence tokens. So the influence to curate a piece of content is directly proportional to the amount of the Hive Power(HP). When you vest your Hive tokens it is known as Hive Power.

So in Hive, we have a reward pool, PoB mechanism, HP. Being a decentralized ecosystem, every user is empowered to determine the value of content & curate it, and it is influenced by the HP of the user. However, there is a community guideline "which content should be monetized and which should not be". This is in place to check the possible abuse of the reward pool by the bad actors.

Put simply, by using the upvote tool, first, the reward is being distributed and using the downvote tool, the reward is further being redistributed(or fairly distributed) by downvoting the bad content. So downvoting tool is acting as a filter mechanism to keep the bad actors in check.

Where does the money on your posts come from on Hive?

The underlying principle of Hive is that if anything that benefits the ecosystem then everyone should pay it else no one should pay if it is detrimental. Based on this principle the content is monetized and the beneficiaries are paid.

So far we have established:-

  • There is a fixed reward pool
  • Every user is empowered to upvote or downvote, influenced by Hive Power. If you want more influence, power up Hive.

HP(influence tokens) is a tool to distribute/redistribute the reward using upvote/downvote. But that does not equate to "money comes from HP". Because even if a curator does not vote, 65% of the reward pool is still being created & distributed among the authors and curators. It is a separate thing that whether you are a beneficiary of that reward pool or not. So in either case, whether someone votes you or not, the reward pool will continue to allocate 65% of the pool to the authors and creators. That means it is the reward pool that is paying you(or in other words, it is the Hive community that is paying you) and not the voter who is voting your content(albeit it is influencing the distribution of reward).

Let's go with an example.

Suppose the PoB reward pool is 1000 HIVE. There are 10 users out of which 6 curate the contents produced in Hive Blockchain. So these 6 users will influence the reward distribution of 1000 HIVE and these 6 users will also be the beneficiaries as curators. If all the 10 users exercise their HP and curate the contents, then 10 people will influence the 1000 HIVE distribution and become the beneficiaries as curators.

Put simply, if more people will engage and participate in curation, it will help the fair distribution of the reward in a decentralized way. In such a case a large group of people will share the reward and hence the upvote worth may be less(as reward pool is fixed), but good for the decentralized distribution of the reward pool.

Conversely, if fewer people will engage and participate in curation, the distribution of reward will be skewed. In such a case, a small group will share the reward, upvote worth may be high, not good for the community.

So the bottom line is-- The money of your post comes from the reward pool(or in other words, it is the Hive community that is paying you). HP can only influence in distribution/re-distribution(or fair distribution) of the reward.

Thank you.

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