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Why Flagging Is Bringing Down The Value of Steem, As A Currency by dragosroua

View this thread on: hive.blogpeakd.comecency.com
· @dragosroua · (edited)
$11.62
Why Flagging Is Bringing Down The Value of Steem, As A Currency
![](https://img1.steemit.com/0x0/http://dragosroua.com/wp-content/uploads/2016/10/steem.png)
***
Flagging has definitely been the number one issue during the last couple of months in Steemit. It came in many flavors:

* whales flagging content they deemed “undeserving” (didn’t agree with the payout, “too much money for this post” - @nextgencrypto/@berniesanders, @smooth)
* whales flagging content which looked “shady” (potentially gaming the platform for the benefit of a small group - @dan versus @ozchartart)
* dolphins and minnows creating voting guilds to counter act these whales by combining their voting power (@steemvoter “stealing” the voting power of its clients to counteract a flagging campaign)
* random flagging to each and every account on Steemit because reasons (the infamous @iloveupvotes and @asshole) 

There was a lot of bandwidth filled only with flagging related posts and I’m sure many of my fellow Steeming are fed up with the topic.

So why opening it again?

Well, because I think flagging is the number one reason of Steem going down, as a currency. During the last two months, Steem lost about 50% of its value. Even in crypto terms, where volatility is high, this number is significant.

Let me explain.

# How Value Distribution Works In Steemit

Each day, because of inflation, the Steemit reward pool is filled with about 43000 Steem. This Steem is then redistributed via voting.

When you upvote a post, you redirect a certain amount of the reward pool, based on a specific algorithm. The most important part is that you direct a part from the reward pool _proportional to the amount of Steem Power you own_. That means someone holding a large amount of Steem Power can move a large amount of the reward pool. That part is “allocated” to the post and stays there until the earnings are distributed, when it moves to the author account. A post may earn reward only during this period: between publishing and earnings distribution, which is roughly 24 hours.

# What Happens When You Flag/Downvote

I’m using the terms “flag” and “downvote” alternatively because their action is similar. 

When you flag a post, you take out _from the portion already allocated from the reward pool for that specific post_, by the previous votes. The part you take out is also proportional to the amount of SP you own. That means someone holding a large amount of Steem Power will take out a significant amount from the portion already allocated to that post. 

Now, here is where it gets interesting.

If you downvote, _you breach a contract between two parties which didn’t give you explicit permission_. You take out the reward that somebody else considered ok for that post, without asking for his or her permission. You literally “steal” from the potential winnings of an author, without any consequence. 

Every bilateral contract should be inviolable by a third party. If A gives to B, by upvoting, a certain amount of the reward pool, then C cannot interfere in this process, unless A  and B gave express permission to C to do it. This “explicit” permission doesn’t exist in Steemit. It’s implicitly stated at the voting mechanism level.

Strictly in legal terms, you are not allowed to do this. You can’t intervene in a transaction between two parties, unless you were given this role in a previous contract between those parties. Usually this role is called “arbitrage”. 

In this case, this role is not clearly set, not in the TOS, nor in the UI. There’s nobody telling you upfront, very clearly, you can get “robbed” of your potential money, if somebody else decides to do so. 

I'm using the terms "stealing" and "robbing" in a metaphorical way, not in a legally binding way.

# An Even Simpler Example

Let’s say I’m a coach and I deliver a coaching session to a group of clients. This thing happens in a building with many rooms, each room hosting a separate coaching session. Each day there is a certain amount of money in the building, money that should be disbursed to the coaches, by midnight, using _atomic, individual transactions between attendees and coaches_. 

So, if the attendees in my room find the session useful, they pay me. Some decide not to pay me. 

But other people, just by looking at the transcript of the session I gave, and at the transcript of my earnings, decide I got too much money. 

Stop for a moment and look at that: _I got too much money from the money I already received, from other people_. And they take out a certain amount of money out of that, proportional to their influence in the building.

Would you be a coach in such a system? How predictable is your activity there? How can you increase its predictability? 

If there is no other rule, the only obvious way is to create partnerships with influencers. Or with people who proved they can hurt your earnings if you don’t conform with their requirements.

In some countries, this is called a protection tax. In other, it is called “mafia”.

These types of structures appear when the governance is either too weak, either too difficult to enforce. If a system is left unorganized, it will self-organize around power people, or those who can guarantee survival (in this case, who can guarantee your revenue won’t be hurt). 

On the other hand, if a governance mechanism is too regulated, it becomes a burden and value can't move freely. 

Steemit doesn’t even have a governance mechanism in place. There are a few witnesses required to run the hardware layer of the platform (and I'm happy to be one of them for a few months now), but there is nothing clear about what they can or cannot vote / downvote. There is no Steemit Constitution, there are no rules other than the plain old: “I’m the powerful guy and you’re weaker than me so if I don’t like what you say I’m exerting this power to rebalance things according to my own views, not to yours”.

# It’s Human Nature, Not Steemit

The bad news is that this thing is _not specific_ to Steemit (unfortunately, there is no good news).

Greed, pride, jealousy, these are not invented by Steemit. They were around since humans are on this Earth. They are dragging down the entire world, not only Steemit.

So it’s not the algorithm, it’s not the code, it’s not the UI, it’s not the marketing, it’s the people. It’s their engrained greed and pride and jealousy which are pushing towards a society in which the only rule is brute force (or the force of the wealthiest). Again, this is not invented by Bitshares or Graphene or Steemit. It has nothing to do with it.

It’s just how we, humans, are wired. We’re stupid.

Who wants to live in a country where people are constantly fighting with each other? How many Syrians are leaving their country specifically because people are fighting a war, this time with real weapons? 

How many of you want to move to Syria right now? Come on, folks, how many? Raise your hand, I want to see you.

Huh.

Nobody?

Why? Because it’s unpredictable? Because your life is modified without you giving explicit permission? Because there’s no rule, other than the one with the biggest weapon? 

If you replace "weapon" with Steem Power, how different is that place from Steemit now?
***
_I'm a serial entrepreneur, blogger and ultrarunner. You can find me mainly on my blog at [Dragos Roua](http://dragosroua.com) where I write about productivity, business, relationships and running. Here on Steemit you may stay updated by following me @dragosroua._<center>
![Dragos Roua](http://dragosroua.com/wp-content/uploads/2014/05/bamf-e1448824881306.png) </center>
***

<center>_**You can also vote for me as a Steemit witness here: 
https://steemit.com/~witnesses**_</center>
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vote details (185)
@demotruk ·
>If you downvote, you breach a contract between two parties which didn’t give you explicit permission. You take out the reward that somebody else considered ok for that post, without asking for his or her permission. You literally “steal” from the potential winnings of an author, without any consequence.

Rewards are not finalized until the payout is approved by stakeholders. All stakeholders get to have a say in that process, including the ones who oppose the payout. They are not an independent third party, they are directly party to the contract as stakeholders of Steem.

Downvoting is a necessary part of the system. I do agree though that it is doing harm though, despite being necessary. I wrote some posts which propose a system to minimize the need for flagging by making votes which contain greater information from the stakeholders.

[Loss Aversion on Steemit](https://steemit.com/steemit/@demotruk/loss-aversion-on-steemit)

[Up and Down Votes Are A Big Part of the Problem on Steemit](https://steemit.com/steemit/@demotruk/up-and-down-votes-are-a-big-part-of-the-problem-on-steemit)
👍  , , , , , , ,
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vote details (8)
@dragosroua · (edited)
> Rewards are not finalized until the payout is approved by stakeholders.

Rewards are finalized at the end of the day, there is no specific transaction on the blockchain that says: ApproveAllRewardsForTodayDate that gets signed by ALL stakeholders. 

For the time window allocated - which is 24 hours now, subject to change to 7 days in HF 17 - the stakeholders are voting and when the time window expires, whatever has left in the post "account" is transferred to the author account. That's how things are working right now, according to the code I read on github. If there's something I missed, please let me know.

The fact that the rewards are not finalized is not colliding with the individual contract between two entities. The reward pool  is neutral, or agnostic. Theoretically, if nobody votes, the reward pool vanishes at the end of the day, it doesn't redistribute equally to all the stakeholders (which would be also bad). 

It becomes valuable, or active, when someone casts a vote. From that moment, the person casting a vote has a "contract" with the receiver, in which the part from the rewards pool he dislocated, is directed to the author. 

Now, if another person comes and take out a certain percentage from the post account, he literally breaches the previous contracts between all the previous voters and the author of the posts.

The precedence of a vote is irrelevant in the current system. All it counts is the weight, in SP, of the voter. This leads to arbitrary results which are increasing entropy and are discouraging users for contributing to the platform.

I'm not making any moral or ethical statement, it's just a theoretical comment about how "consensus" or the lack of it, is reached right now in the Steemit ecosystem. Strictly the part about rewards, not the block signing consensus, etc.
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@demotruk · (edited)
>For the time window allocated - which is 24 hours now, subject to change to 7 days in HF 17 - the stakeholders are voting and when the time window expires, whatever has left in the post "account" is transferred to the author account. That's how things are working right now, according to the code I read on github. If there's something I missed, please let me know.

You seem to be missing, despite clearly being aware of, the facility written into the system which allows any stakeholder to apply negative r-shares to a payout proposal.

The contract is between the payout recipient and the stakeholders. Some stakeholders apply positive r-shares to the payout. Others apply negative r-shares to the payout. The result depends upon the culmative amount, not just the positive. This is the contract which allows all stakeholders to have their say, if they so choose.

>The reward pool is neutral, or agnostic. Theoretically, if nobody votes, the reward pool vanishes at the end of the day, it doesn't redistribute equally to all the stakeholders (which would be also bad).

I don't believe this is true. As far as my understanding goes, the reward pool continues to exist indefinitely and will be allocated when a payout happens, as long as that takes.
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@denmarkguy ·
I really like Steemit, and can only hope that what we're experiencing here falls under the broader heading of "growing pains." 

For me, the most important thing to remember-- and to keep stressing-- is that communities are built by *people*, not by technology or scripts or bots. And so, when we look at these issues now surfacing, they are ultimately "people issues" not technology issues... which seems to be *your* undertone, as well. 

Maybe it would behoove everyone to look *outside* Steemit and look at the broader dynamics of startups. There tends to be a core group of early adapters who end up as significant stakeholders because they took the risk of getting involved early. They end up as "micro-millionaires" on the back of... well, very little but good timing and good fortune. 

Nothing *wrong* with that... but their simply *human attachments* subtly shifts from having a vision of the project going forward to *"preserving my pile of gold."* And it's just human nature at work... not evil intent. You look at people who invested in a private offering in a company, and they start wholesale dumping their stake immediately as the IPO goes out... "holding onto the gold." At which point the long term stakeholders jump in and make *long term investments.*

How does this relate to the flagging and related? Well, it's a sort of battle of "the old, let's not change anything" vs. longer term community members. The inherent fear of *"I'll get LESS, if I allow things to change."* Of course, few will fess up to that in public, but the underlying psychology is there.

So what truly FUELS Steemit, going forward? Houston, we have a problem. Or at least a conundrum... this bills itself as a "social" site, yet it seems rather dominated by bots, scripts and technology. Well "rewarded" content can have 300 upvotes but has been READ 25 times? That makes little sense... especially if you're a content creator trying to make the decision *"Should I set up shop here?"*

I don't know about anyone else, but I like to collect *readers* not *bot-pings."* If I'm an artist, and I post pictures of my art and link to my web site? I'm pretty sure those bots aren't going to go to my web site and order a piece of art! 

Whereas I can see your point about "breach of contract," I can also wrap myself around viewing the first 24 hours more as a curation *process,* a period during which the "score" for my content is determined, through some form of community consensus. Not everyone is going to like what I created. Such is art, writing, photography, protests, politics and what have you.

So I'm really OK with someone casting a "minus vote" for not liking the *content*-- not so much with casting a minus vote as a protest against *others liking* the content... which seems like what we're dealing with.

From where I am sitting, it's not the flagging-- itself-- that's hurting the price of Steem, but the relative *arbitrariness* of that flagging... which creates unrest, instability and division in the community. And an unstable community is not an attractive investment...
👍  
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@j3dy ·
https://steemit.com/life/@j3dy/water-and-light-d4-challenge30-play-2

https://steemit.com/story/@j3dy/having-fun-on-steemit-c30-d3-week-recap-work

You are welcome to read my posts :) made in more peaceful times :D when the challenge30 was active :) 

Those would be the most concerning community. Other material I have on the topic is from comments and no where near as coherent. I would like to hear your thoughts :)
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@j3dy · (edited)
Thank you for actually taking the time :) I saw an upvote so I suppose that's a check mark :D
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@denmarkguy ·
@j3dy, I really enjoyed the posts-- sadly, they are evidently "too old" to allow new comments, so I couldn't leave anything. Not the first time I have encountered this... but it does beg the question of why readers would not be able to leave a comment after a certain time.
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@grandpere ·
For a new user, for an uninitiated, how to see a flag, who made the flag?
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@j3dy ·
https://steemit.com/@grandpere 
https://steemd.com/@grandpere  
https://steemdb.com/@grandpere
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@gutzofter ·
> So it’s not the algorithm, it’s not the code, it’s not the UI, it’s not the marketing, it’s the people. 

Preaching to the choir.

I must say though, that there is a explicit governance that is called Proof of Stake.  In this case Ignorance is not bliss.
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@gutzofter ·
Sorry to comment twice.
I think you are mistaken in thinking that someone is stealing by downvote/flag. Using a downvote/flag is equivalent to applying an upvote to all other content equally during that 24 hour period. Also, by using an upvote your are then down-voting all other content that you have not upvoted during that same 24 hour period. You can not have two equal operations and then say that each one is opposite of each other. By your logic, a person upvoting one piece of content is breaking a contract of another  content that was not upvoted. Therefore to not break contracts you must vote for all content or you will be in violation of contracts.
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@dragosroua ·
No worries about double commenting, it's ok @gutzofter.

First of all, what you call Proof of Stake is not a governance mechanism, it's a way of validating transactions, just like PoW in the Bitcoin universe is not a governance mechanism, but also a way of validating transactions. It's a long way form here to say PoS is a governance mechanism. On top of that, what we have in Steemit is Proof of Influence, because nobody is _actively_ using its stake. When you vote, you don't block anything as a collateral, _actually proving_ that you have that stake, you just present it at the moment of vote and the calculations are made based on _what you say you have_, not on what you block as collateral. Also, when you upvote, you get curation rewards, but when you downvote you don't get slashed.

Now, about the contract-related comment. What we define as "reward pool" has no owner, it's an agnostic quantity, which doesn't belong to anyone. And that stays true until someone is actively choosing to allocate a portion of it to somebody else, by upvoting a post. That transaction is a bilateral transaction between two parts: the upvoter and the author. Previous to that, the allocated portion didn't belong to anyone, the upvoter makes it belong to the author, based on what "stake" he has (actually, based on the influence, see the paragraph above). So there is no implicit transaction between the upvoter and any other content. It's not a negation,  since that portion didn't belong to anyone prior to the comment. It's the downvote which actively negates the previous votes, because it is directed to a certain "amount" resulted after a string of bilateral transactions in which the downvoter wasn't part. The fact that the SP resulted after the downvote gets back to the reward pool, making it agnostic again, doesn't compensate in any way for the fact that it invalidates the previous transactions. There is in implicit breach between the downvoter and the upvoters.

Again, I'm, not making any ethical or moral comment here, it's purely from a functional point of view. A system in which a third party can arbitrarily negate previous transactions between other members of the system will have an increased entropy and low predictability, thus making it less interesting for other potential members.
👍  
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vote details (1)
@ianstrat ·
Great article
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@kooshikoo ·
I don't quite agree that flagging is the biggest issue afecting the steem price,but I agree that it's the biggest problem to solve.It scares people away,and gives Steemit a bad reputation.
Upvoted and resteemed.
👍  , , , , , ,
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vote details (7)
@dragosroua ·
Thanks for the upvote and resteem. Also, we don't have to agree on anything. I can agree to disagree with you. :)
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@krnel ·
Thanks for finally speaking up on the issue. I appreciate it. Resteemed.
👍  , , , , , , , ,
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vote details (9)
@dragosroua ·
Thanks. I have an idea for a new voting algorithm that may alleviate parts of these problems. I'm still doing some simulations. If it's proven worthy, I'll publish a blog post tomorrow, I'd be interested in your opinion.
👍  ,
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@krnel ·
Great. Do you understand the centralization of power as the root causal factor for many issues, that have been recognized months back, even before I got here? This can change while everyone keep their STEEM and makes money when the token rises by the community leading the community, upvoting each other, with no power players deciding who gets what. People curate on real social networking sites, without curation rewards. Those who create lasting value will get rewarded according to the community, not the power players. Those who want to be part of the community will create the community and make it prosper. Decentralization of power in the community is the answer. [SCD #7 - Working Towards a Decentralized Self-Governance of the Steemit Community](https://steemit.com/steemitcommunity/@krnel/scd-7-working-towards-a-decentralized-self-governance-of-the-steemit-community)
👍  , , , , , , ,
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vote details (8)
@kzollove ·
Unfortunately, Steemit is a pretty amazing simulacrum of Capitalism. It generates some pretty cool product, but also amplifies greed, jealousy, obsession, etc. 

As a new Steemit user, I feel happily shaded from the "Bad Whales" and other flaggers/downvoters. I don't post particularly controversial material, and I take a fairly small portion of the daily pot home.

I admittedly have not been on here long enough to understand the nuances of flagging/ downvoting, but this argument is certainly a compelling argument that suggests that the negativity of the act is *literally* the bane of the Steemit economy!

Circulating **positivity** (even if it means grinning and baring the success of others) will make Steem a valuable currency. We have a unique opportunity to create literal value by just following the rules that we were all taught in K-5:

1) Participate
2) If you have nothing nice to say, don't say anything

Thanks for a well-articulated, thoughtful post, @dragosroua
👍  
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@dragosroua ·
Thanks for your input. I'm also shaded from downvoting so far, but that doesn't make the issue non-existent. Just because it doesn't happen to me, directly, it doesn't mean I'm not affected by it, indirectly, by the price of Steem going down. Yes, a bit more positivity would be good. Or just a bit more responsibility.
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@len.george ·
Thank you for a well thought and said post dragosroua. 
Now how do you get the whales to read it?
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@lifeworship ·
They don't understand the dynamic, because they are an unconscious part of it.
A better platform should be along any day.
👍  , ,
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vote details (3)
@lighteye ·
Well said @dragosroua. You have valid points and I hope they will make certain people think.
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@dragosroua ·
Thanks. We shall see.
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@nanzo-scoop ·
> Every bilateral contract should be inviolable by a third party.

There is no contract between the author and the upvoter as the author has provided no consideration. Writing the post does not count as consideration, as past consideration is no consideration. It is even arguable whether the upvoter has provided consideration.

A voluntary upvote against an already written post is about as far away from a contractual arrangement as you can get. And it's probably best to keep it that way.

> Steemit doesn’t even have a governance mechanism in place.

I think there is merit to delegating downvoting to moderators ("Flag Review Council") that act on behave of the community as a whole. In the same way Witnesses do. Downvoting should be reserved for abuses of the system and exercised sparingly.  

Because of the negative connotations a downvote carries should not be subject to the individual whims of whales. However bad or well reasoned a flag is, it should be viewed as a collective flag from the community not an individual.

Flagging spam or plagiarised content should operate pretty seamlessly in the background. Nothing can be more unappealing to new joiners than to see existing members bickering over who should get how much of the spoils.
👍  
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@dragosroua ·
> Nothing can be more unappealing to new joiners than to see existing members bickering over who should get how much of the spoils.

Seems that we are agreeing on this one. 

As for the contract, the author makes a proposal for review (by publishing a post) and people who are upvoting are signing a contract (which is, physically, a transaction recorded in the blockchain) to allocate a certain portion of the reward pool to that author.
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@nanzo-scoop ·
> people who are upvoting are signing a contract

They are not signing any contract. 

There is no "offer". 
There is no "acceptance."  
There is no consideration. 
There isn't even an intention to create a legal relations. 

People are voluntarily choosing to upvote content. 

Whilst I understand the sentiment, your use of the word "contract" is incorrect. A contract is a legally defined term that has a specified meaning and consequence.

> allocate a certain portion of the reward pool to that author.

It's not even in the upvoters gift to allocate a 'certain' portion of the rewards pool. The upvote is one of numerous factors that affects the portion allocated once the payout period arrives.
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@personz ·
> If you downvote, you breach a contract between two parties which didn’t give you explicit permission. You take out the reward that somebody else considered ok for that post, without asking for his or her permission. You literally “steal” from the potential winnings of an author, without any consequence.

This is a really damaging and misleading interpretation. There is no contract in breach, the permission is not explicitly required as it is implicitly granted by the system. I'm sorry but this is an incorrect interpretation.

Not I'm not defending this as a ways the system should work but by using steem you are granted the ability to vote up or down as you please, as is everyone. There is no contact.
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@dragosroua ·
There is a significant difference between upvoting and downvoting: upvoting is allocating resources which don't belong to anyone (yet), while downvoting takes out resources which are allocated (even temporarily) to a specific member. The fact that there are previous transactions that a downvote negates makes it different than an upvote. And I'm talking strictly from a functional point of view. That's what I meant by "breaching a contract".
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@personz ·
What you've outlined, about adding and taking from resource allocation, is correct to the best of my knowledge. But the interpretation of it as a contract is fanciful, and I didn't see the qualifications you make in this comment in your article. Considering your important place in the community, especially as a witness, I'm frankly surprised. There is no stealing. Before the payout is finalized _anyone_ and indeed _everyone_ can vote a post up or down.

What you are suggesting by saying this is that a down vote is potentially illegal and definitely immoral. It would be very misleading for a Steem newbie to read this.
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@phillycheeze ·
Very interesting.. thanks for the post.
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@pompe72 ·
https://steemitimages.com/0x0/http://i64.tinypic.com/2pzim2p.jpg
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@publicworker ·
This is why we need tip based community.
👍  , , , ,
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vote details (5)
@ramta ·
I love being on Steemit and I love the posts from @dragosroua because they make me think and learn.

Greed, pride, jealousy, these are not invented by Steemit. They are human feelings and so is happy, contentment or the "fact" that I love Steemit.

Downvote is feeling bad about something or it can be help, if you write in a comment why you downvote. 
Upvote is feeling great about something.

People will come back to Steemit again and again if they feel great about being here.

I will leave Steemit the day I can not find good feelings anymore.
I do not think this will happen §;-)
👍  , , , , , , , , ,
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vote details (10)
@richq11 ·
Yes!!! Your perspective on downvoting is the most profound argument I've heard so far! Very well put! It does infringe on the rights of "fans" to reward content from authors they like and it is a personal affirmation that should remain inviolable!
👍  ,
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@skeptic ·
https://www.minds.com/newsfeed/683778713044656131
spreading the word of steemit all over the internet.
👎  
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@stellabelle ·
> Who wants to live in a country where people are constantly fighting with each other?
👍  
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vote details (1)
@dragosroua ·
$0.05
Happens to have an answer to this, or do you just agree?
👍  
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vote details (1)
@stellabelle ·
I totally agree. I am not interested in that world at all.....
👍  , , , ,
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vote details (5)
@stellabelle ·
These are my thoughts on this same topic...I wonder if you'll get it:
https://youtu.be/StMQmFUBm48
👍  
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vote details (1)
@surfermarly ·
Thanks for your message which I consider very important! 
That was one of the key sentences to me: 
> So it’s not the algorithm, it’s not the code, it’s not the UI, it’s not the marketing, it’s the people. 

It´s neither the system nor the arm that *change* a person´s behavior. People act driven by their established value systems and their beliefs. And they tend to follow the most powerful. To stick with your example: if flagging is shown as a valid instrument to express power by the most powerful, others - with less power - will use it as well. Flagging has become kind of *trendy* on steemit. 

Even in a decentralized eco-system you need some alpha-males as *role models* that live the values which will sustain the system in the long run. Just believe in a friends party. Nobody will start dancing until one conquers the dancefloor and animates others to join. Any community needs powerful, positive, progressive and inspiring *leaders* - people others can look up to - that love to push forward the whole thing. They are all here, just have been a bit quiet lately...:)

I am absolutey convinced that steemit - and steem - has everything that it needs to become an attractive investment again. In my opinion it just has to be woken up again... Maybe some of these *dancefloor conquerers* are listening right now :)
👍  , , , , , , ,
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@dragosroua ·
Nice metaphor, I like it. Let's see what kind of dancefloor conquerors we still have around here.
👍  , ,
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@grandpere ·
$0.19
On Steemit, there are two types of leaders: "dancefloor conquerers" and "no governments, no rules, no violences". The last one has power.
Alan Turing ("Imitation game") had the power of cryptography but did not have the psychological and social skills to manage a company or organization.
👍  , , , , , , , ,
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@surfermarly ·
A good leader has both - or at least a team of executives that compensate missing abilities. But then he still executes both.
👍  , , , , , ,
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vote details (7)
@tradeqwik ·
I loved your article, and I agree with your core message here, but your legal basis argument is cringe worthy and should go.  

The third party argument doesn't apply at all.
This is because we're all sharing a common scarce resource and the contract is to determine the distribution of that resource overall, hence we're all primary parties to the same contract.  

Furthermore the strength of our claim of right to determine the use of that common resource is based upon our investment level in the company exploiting that resource, i.e. SP.  This is all explicitly spelled out for us ahead of time and we are reminded of it nearly everyday.

In this way downvoting can be thought of as overriding or vetoing, the wishes of a large group of minority shareholders by the decree of a handful of "majority share"-holders.  This is perfectly legal and happens all the time in the corporate world.  Voting guilds are exactly equivalent to shareholder proxy voting https://www.shareholdereducation.com/SHE-proxy_process.html


Here's the simple truth.  Downvoting and flagging for earning too much makes you as a person look like a petty douchebag.  When people see this power exercised, they choose to either leave or not join in the first place, you make us all look like petty douchebags.  People would rather be on facebook, reddit or whatever where they are on equal footing, than to deal with the slap in the face that comes from a whale downvote over too much earnings.

What shocks me the most is the number of anarcho-capitalists that feel like the voting system is a good thing in general.  

Down voting is the equivalent of government taking your earnings to give them to someone else.  

Upvoting the way we have it right now is fascist, since it's not what you say, or what you know, but who you know.  How well connected you are directly drives your earnings day in and day out.

A much better system would ditch downvotes all together, or at least penalize the downvoter as much as the person being downvoted.  Then everyone getting equal power in their votes.  In order to encourage SP holding, the sheer number of available votes could be driven by SP holdings.

To find out what payouts would look like if everyone had equal say check out @screenname and his excellent posts that call this out every single day.  The difference could be pretty dramatic.

In order to limit mitigate a sybil attack you could just require a minimum amount of SP before your vote does anything at all and then increase number of votes directly proportional to the amount of SP held instead of these powerlaw and exponentiation schemes we have now.

This method would be more fair and it's exactly what we do within VIVA, but there's no reason steem couldn't adopt a similar approach.

Excellent article!  Upvoted & resteemed!
👍  ,
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vote details (2)
@personz ·
> [...] your legal basis argument is cringe worthy and should go.

+1 and glad you also called this out 👍
👍  
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vote details (1)
@williambanks ·
Argh!!!  I need to remember to log out of that account before commenting.  Grrr.
👍  ,
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vote details (2)
@trevor.george ·
So how about something radical?

Upvoting gives you money.
Downvoting doesn't take away any money.
Downvoting shifts your post further down the page, towards the back of the queue. How much is not proportional to anything - 1 downvote = 1 shift downwards or similar.

10 downvotes hides it, or flags it as spam or whatever.

Serial downvoters are monitored and blocked from downvoting for x days.

e.g.
So they can downvote a maximum of 5 posts per day and then they are blocked for a bit.


Let's keep things simple. Instead of having to re-write the code to deal with hiow this affects teh payouts, just take it out of the equation all together (which requires re-writing the code..... I know. Sigh)

While I was hit a little in the downvoting wars, I mostly stayed out of it, so it didn't affect me much.  But I can see how this warps the community and takes away it's focus on producing good quality content.

Maybe a bit of a rethink is needed about the governance of Steemit.
Decentralised - yes. Ungoverned - no.

The governance could be partially code based with the witnesses backing it up - 'meeting' once a week or so to sort through issues and make redress, ban people, warn people etc. 

I'm not sure how viable that would be. But i don't buy the argument that anarchists would put froward about no governance being the way to do this. We have no governance now and look at what is happening. and this is what happens to any system as soon as you put people into the equation. 

Anyone who writes code will tell you their system was working perfectly until the users got near it. ;-)
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