How does that vote feel?

LeoFinance
22 days ago
12 Min Read
2386 Words

Some of you might have noticed the jump in post values, which is caused by the feed price starting to reflect the spike in price on the weekend. Most of the day the blockchain was calculating at 51 cents, now it is at 70 cents, which is a ~40% jump. It is pretty cool to see the vale increasing and when I noticed, I went straight to @slobberchops post and gave him a 100% vote (about 8 dollars) because, he deserves it. Also, because for nigh on 3 years, I have said to him in regards to all the HIVE has has bought over the time - "just wait until price increases and you can feel your vote make an impact".

I really hope that everyone who has been here through the bear market and been buying while others have been selling are starting to feel like their investment has been worth it. Yeah, there are many other coins out there that have performed better, but this is far more fun, isn't it?

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However, this also brings up a good illustration of how the platform works in regards to payout. I will put it into very simple terms just so people can get a feel of what I am talking about.

If Hive is worth 10 cents and HBD is worth 1 dollar.
A 20 dollar post will get the author 10 dollars.
That is split (if going 50/50 on payout) between HIVE:HBD
It will get 50 HIVE and 5 HBD for the author.

However,

If Hive is at 1.00 dollar and HBD at 1 dollar.
The same 20 dollar post will get a split of 5 HIVE and 5 HBD for the author.

Currently, the Hive rewards fund, the inflation pool has 854,991 HIVE in it worth ≈ $601,914 - which is calculated at the at the approximate 70 cent price feed. If the price feed was 7 cents, the value of the pool will be ≈ 60,000 worth and if it was 7 dollars, it would be ≈ 6,000,000 worth. But, the HIVE in the pool at any given time is the Hive in the pool available for allocation.

So, this is allocated through various mechanisms including voting, like I did on the post I mentioned above. However, vote value is determined by stake in relation to all other stake - which means the HIVE POWER staked to the platform (technically the vests) is what is used to allocate a percentage of the pool to a post. A person with 100 HIVE POWER has half the draw on the pool as someone with 200 HIVE POWER.

To keep it easy, I have about 200,000 HIVE power and it can allocate 10 HIVE with each vote, which is 7 dollars worth if the feed price is 70 cents. However, under the same stake conditions with the feed price of 7 cents - my vote would allocate the same 10 HIVE, but would only be worth 70 cents. At 7 dollar feed price, my vote would be worth 70 dollars and, the same 10 HIVE.

However, while the HIVE is the same, most people opt for a 50/50 payout of HIVE:HBD. This means at 7 cents, there would be 5 HIVE and 35 cents worth of HBD. At 70 cents there is 5 HIVE and 3.50 worth of HBD. AT 7 dollars there is 5 HIVE and 35 dollars worth of HBD. Obviously, people want a higher price on their posts and of course to earn more, but those who hold also want a higher price as it is good for their token and vote value - but, voting doesn't earn HBD, it only earns HIVE in curation and that HIVE is powered up. Essentially, if someone is only voting, the only way for them to practically use their earnings is to powerdown. But, content creators can take 50% of their earnings as liquid and use it immediately after payout. Something to think about.

The other thing to think about are the payouts themselves, as a lot of people focus on the dollar value and don't necessarily understand the mechanics behind it in regard to Hive. The higher the price goes, the harder it is to earn Hive, which is why for all of these years I have been trying to convince people who say they want to go long on Hive, to post in the lows. However, it is a bit like Bitcoin, people want to buy it more at 50,000 dollars than at 5,000 dollars. Factoring in the value of HBD into the payouts explains a lot of this. However, for the curators, they get the HIVE benefit when they vote regardless, as they do not have access to the HBD portion through voting.

But, as prices increase, people start to talk about "the value" of posts and this is especially true for new people who haven't been here long or, people who have been here long but haven't built up the "social capital" and "network" that a social network rewards. It is also the case that many people don't see the value of posts on topics they aren't interested in, nor do they see the background of the account past the most recent posts, as most will never dig back very far.

For example, @slobberchops was saying that his post tonight was his first 100 dollar post ever, which is awesome - especially since I met him at the end of 2018 in Poland at #####Fest3 and the price had tanked heavily from the highs from the start of the year when he had joined. Even though this is a blockchain and everything is recorded, no one really looks back very far past their opinion about what is in front of their nose.

However, the higher prices go, the more people will earn who have built up capital, with people who at the depth of the bear were earning 5 dollars a post, now getting 35 dollars a post. People complained about earning those five dollars, without realizing that if one was unable or unwilling to buy HIVE, that was the best time to earn. The Hive social dynamics and game theory are strong, but most don't pay attention.

Let's say I create a brilliant post and the price feed is 10 cents. People want to reward it, but their vote isn't worth that much, so vote at 100% or larger percentages. Lets say it gets 10 dollars in votes in total. The curators (keeping it simple) get 50 HIVE spread amongst them, the author gets 25 HIVE and 2.50 in HBD. Not exactly a princely sum for my brilliant post.

However, if Hive was at for example 10 dollars and all the same people voted with the same weightings and conditions etc, the curators will get 50 HIVE spread, the author will get 25 HIVE and 250 dollars in HBD - because that same post now has a 1000 dollar value. These posts at the highs existed, but weren't common, because people lowered their voting values and spread the votes wider. A person with a 1 dollar vote at the 10c low, now has a 100 dollar vote at the $10 high, so instead of rewarding a single post 100%, they might reward 5 posts 20%. This means that if everyone for example halved their vote value on that some post - the post would still be worth $500, but would attract half as much Hive as when it was a $10 post at the lows.

If this happened across the board when high, all other things remaining equal, twice as many posts would be rewarded. But, that isn't the case, as we are seeing and will continue to see as price increases, because people are interested in earning and the higher the price of HIVE comes, the more attractive it becomes. This creates a lot more competition for resources and those who will naturally have the advantage are those who have not only been here the longest, but who have also added value to the community and built up a valuable social network.

New people can complain about this, but the social environment is a marketplace and first mover and early adopter advantage is still in effect. It doesn't mean new people can't benefit and make inroads, it just means that the more popular the platform gets, the harder one likely has to work for attention. However, because price is increasing and people are more likely to spread, there is actually more chance over time for a wider amount of people to get rewarded, on a more diverse range of content and contributions.

This competition is driven largely by price. For example, at the current values where my vote is worth 10 HIVE, I can allocate 100 HIVE a day, or 3000 HIVE a month, which at 70 cents, has a total value of 2100 dollars. People might be jealous of that or not, but I have been allocating that value to other people's posts for a long time already, it was just in HIVE. Because the value of HIVE was lower, people weren't attracted. For example, I have been voting about half a HIVE on most comments for years through the bear market - no one really cared, but those old HIVES stored are starting to add up for those who engaged with me a lot. 10x from now, those great comments I have received over the years will be well recognized in monetary value - if the people held.

Yet, because people look at the value of an individual post and new people often compare it to their own, without looking at the many (many more than mentioned here) dynamics in play and the way social networks operate, it is common that people get upset.

"Why is that shitpost worth 10x more than my opus?? It isn't fair - it will be the downfall of Hive!"

Not really. If anything, it might be one of the things that drives value in many ways, as it gives the appearance that anyone can do it. It won't be the downfall as while those shitposts will appear, there is also a large group of people looking to add and reward decent content too. And the more attention Hive gets, the more value-adding posts will get rewarded and the shitposts won't - as that is the way it works. Most of the stuff on YouTube back in the day was shit too and now, an even greater percentage of it is shit, it is just that because no one watches the shit, it isn't monetized and gets filtered out of the suggested viewing feeds.

Over 500 hours of content is uploaded to YouTube every minute - how much of it do you think is content gold and how much is turd - not polished turd, just turd?

What is interesting on Hive is because of how transparent everything is, it is very easy to see how entitled people get. No one on Hive is entitled to anything except for what they own. The things you own on Hive are as follows:

  • Your account
  • Your wallet
  • Your content
  • Your vote
  • Your behavior

Am I missing anything?

There are so many sides to the Hive blockchain and because of this, there can be a huge range of diversity in how people think it should be and act accordingly, each believing that their opinion is correct. A lot of people who come in to earn by creating content will end up spending more time making "better" content than what they see rewarded, but spend very little time on building a social network of value, engaging with the community, or developing a niche for themselves with an audience who love what they do - they become generic, and then wonder why no one cares about what they offer. Then they will say that it is the fault and failure of the platform that their brilliance wasn't recognized, without acknowledging that other people who came in at the same time as them have managed to build a strong presence. A lot of the people you will see well rewarded on their content started from nothing. While it is possible to say they were "easier times", there were a lot of other people who started at those same times, who have made no impact on the community at all.

Anyone can produce content, many even produce good content - very few can do it consistently for years regardless of price.

As price continues to increase, rather than looking at the changing dynamics of the community, many will focus on their own rewards without seeing how they fit into the grand scheme of things. People want it to be easy and they look at someone like me do it "easily" and say, "how come he earns on that shit and I have to struggle?". These people will rarely dig to find out the reasons and just assume that the system isn't fair.

Nothing is fair in this life. I can't help it that I joined in early 2017 and you didn't. I can't help it that I have some level of writing skill and a lot of experience in my life. I can't help it that I have been willing to sit here day after day, year after year doing exactly this, learning as I go, helping where I can - powering up when I earn.

What people will likely find if they were to dig into the accounts that regularly earn well is that they have been around a while, engaging with their audience, developing their niche, building their own blockchained personality. How does a new account expect to get supported if no one really knows who they are as an account and why they are? While the blockchains are about trustless transactions, social networks are about building trust, even between people who have never and perhaps will never meet.

I have done this for 100 dollars. I have done this for three dollars. I have done it for free.

The internet is full of content.
Only Hive has Hive people.

Taraz
[ Gen1: Hive ]

Posted Using LeoFinance Beta