Brainstorming Subscription Sinks for SCOT Tokens & Tribes
I was reading @minnowsupport's & @clayboyn's posts the other day about how the Minnowsupport account will be distributing upvotes in exchange for PAL tokens and then also distributing those PAL tokens to delegators while burning the portion that they receive.
Doing this creates a sink for the PAL token. Something that @aggroed has talked about extensively.
- A sink is a means to permanently lowering the supply of a token by destroying it (sending it to @null)
- A faucet is how you distribute the token (i.e. the rewards pool, digital mining tokens, etc.)
A token’s sinks, he explains, derive as much as 90% of the value that a token will have comparative to the 10% of value that a faucet brings to the token.
Thus, it is important to focus a great deal on how you will “sink” your token and take them out of circulation. Minnowsupport has this great model:
- Users can bid for Steem upvotes by sending PAL tokens to @minnowsupport
- Delegators to @minnowsupport get a proportional split of those PAL tokens
- @minnowsupport also gets a proportional split of those PAL, but it burns the portion it receives (creating the sink)
- @minnowsupport keeps the Steem curation rewards powered up.. Increasing its native SP and thus, the amount of PAL that will be sunk over time
My Idea for a Subscription Sink
I’ve mentioned a few times that I’m working on building out my own tribe here on the Steem blockchain with the power of SCOT and Steem Engine. I want to ensure that I do it right and build something of real value. I don’t want to just launch another shit coin with no use case and no user base.
As I’m reading through all the SCOT posts by Aggroed and then also this latest post about Minnowsupport, I was lead to brainstorm how I could implement some sort of similar sink into the token I create as well.
I was writing down a completely different idea when this idea of a subscription sink suddenly struck me:
What if you created an account (much like the @minnowsupport voting account) and you changed it into a subscription model rather than a bid model.
Instead of taking bids in your SCOT from users to upvote their posts, you could have a monthly subscription fee that is payed via your SCOT.
Users who pay the subscription fee each month will get upvoted regularly on their content from the platform’s main account, which would be holding a significant amount of Steem Power. You may even call them “Verified Authors” within your platform. How cool would it be if you could even build in a mechanism on condenser that puts a little verified check mark next to their Steem name?
There is a catch, of course — the content has to be good and thoughtful. Not abusive and solely driven by financial rewards. If you post bad content, you may get a strike. If you do it twice, you may get kicked out and blacklisted from the service.
Remember that the main idea here is to drive value to your token by not only creating a sink, but also encouraging thoughtful content and usage of your platform.
How Does This Subscription Model Create a Sink and Stack Up to The Minnowsupport Model?
- Users join the whitelist and become a “Verified Author” each month by paying a small subscription fee using your SCOT
- Delegators to the service will earn their portion of those monthly subscription fees (based on SP delegated)*
- The servicing account would also get its proportional split of the SCOT, but then burn the portion it receives (creating your sink)
- The servicing account would also keep the SP curation rewards powered up to increase the amount of the SCOT burned over time
A Few Notes:
*I realized that it may not be enough of an incentive for delegators because the subscription fees paid out in the SCOT may not be high enough. To combat this, you could divert a small portion of the inflation pool to also be distributed to delegators. If you do this, you further incentivize delegation to the platform which will help a great deal in attracting a growing user base and more verified authors.
There also must be a balance between the # of verified authors that you allow each month based on how much SP you have. You have to ensure that the verified authors are earning enough through upvotes to make it worth actually paying the subscription fee in the first place.
I think additional value could also be added to this entire system if you had other incentives for the verified authors outside of upvotes. Content creators are always looking for ways to get more eyeballs on their content. Some sort of promotional tools and strategies could also be implemented for verified authors on your platform.
I’m curious to get some outside opinions on this idea, as I’ll likely be implementing it into Steemleo (my SCOT/Tribe) right off the bat. On paper it seems like a great idea to me, but maybe you’ve got some insight that could improve/disprove the idea. Drop a comment below!
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It is cool and great to hear about you starting your own seem tribe. That is good and i love the initiative but the idea of the monthly subscription, i did not think it will work out well. That is my own view but i am open to correction
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I think you could probably get close to the same affect with a subscription model, the only difference I could see is it creates a bit of a chicken and the egg problem. People won't sign up if the return is bad and people won't delegate if it isn't profitable. It has the potential to be a lot more work to try to convince people to delegate or subscribe and to be constantly trying to balance that out so that both sides stay happy, whereas with the bidbot script, the vote value and the token values basically act like a peg within a + or - 10% spread.
I think there's certainly a way to get a working subscription model though, I'll think on it for a bit and let you know if something solid comes to me.
Yeah that makes a lot of sense. I thought about how you can further incentivize the delegation side of the spectrum which should lead to more subscription interest. I came up with the idea of diverting a small portion of the inflation pool to specifically be split to delegators. This would allow a baseline return for all delegators. Then the subscription “payouts” would be icing on the cake.
The bid bot model makes a lot of practical sense and I find myself gravitating toward it. I like the idea of venturing out with something like this though. I appreciate your input greatly, thanks for taking the time and let me know if you come up with anything else as well 🙌🏽
I think it probably helped that we had nearly 2 years of community building and delegation built up before we made this switch. We started with a higher base delegation than most might be able to.
I do think this would be a more consistent sink because of the set frequency and size of the fees to be burned, but clay has a point about getting it rolling.
Having an existing community/delegation definitely would help getting off the ground.
I agree on the consistency and I think I’ve landed on the conclusion to start with a bot model similar to minnowsupport (which, fortunately enough, Aggroed released a post just recently that Steem Engine now offers such a service) and add the subscription sink in later. Probably running simultaneous to the voting bot but on a different account. Then you get 2 sinks. The model could run similar to SBI and could also focus more heavily on attention/marketing rather than purely upvoting.
Thanks for your input, I greatly appreciate it :)
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The only thing I would consider is limiting the number of auto-votes the account does for the subscription. With any of our auto-vote, we had a lot of spam prevention built-in.
It would serve to make it 1-3 posts/day or maybe even something like 5/week. Inspiring people to try and trigger those votes on their higher quality posts first if possible. Quality over quantity seems to get the better manual curation I think.
That’s a good point. I was thinking 1x a day, but I kind of like that idea of 5x a week to inspire better content. The subscription would also have some stricter rules on content production - probably some general guidelines on length, quality, etc.. If those are violated then the subscription would get terminated and the user would be a new member to the blacklist.
Posted using Partiko iOS
As the originator of our Blacklist, I remember when we as a team decided to add quality requirements to our control of the old free upvote system.
Just be sure to have some fairly clear rules, and still leave room for a 'at our discretion' too. With them paying, you can probably be a bit more loose than we were for the free upvote too.
Ah so you’re well versed in all of this. Thanks for the tips! I’ll definitely let you know if/when I implement all of this!
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Really interesting idea. I do like the idea of just having a base minimum as a "verified author" vs promoting posts which I typically don't bother with.
I do as well. I think that I’m going to run a voting bot in the beginning similar to Minnowsupport and then add in a second account/delegation pool to do a verified author subscription service. It would be cool to also include some sort of tab for “curated content” which could just be content by these verified authors.
Then becoming a verified author could mean that you get some sort of set upvote on your content, but you also get attention and marketing for your content — which is just as important imo.
Posted using Partiko iOS
You got in your hands a great future tribe