HF21 is coming, and despite legit concerns aired by many highly-informed and insightful community members about HF21 and the EIP specifically, and despite the fact that the markets are clearly communicating they think HF21 is a horrible move (STEEM is down to one third of the price it had prior to Steemit Inc communicating its plans to put the EIP into HF21, 50% if you count in USD). Some of us (including me) predicted this drop. My prediction was 0.00001 .. 0.000015, and we are quickly approaching that level right now as HF21 comes closer.
Not only are Steemit Inc and the top witnesses not backing down, they aren't even considering, or even responding to queries about the most important and essential, yet trivial to implement social repair to HF21: reducing the dust threshold from $0.02 after curation to $0.002.
Why is this repair so much needed? Well, it is at the dust level treshold where the different HF21 components all come together and together give one huge punch to social interaction on the core STEEM platform.
- The share of the inflation going to autors+curators is reduced from 75% to 65%
- The author share of this share is reduced from 75% to 50%, or to state it differently, from 56.25% of inflation to 32.5% of inflation.
- At the lower end of the reward curve, pay-out is reduced by a further 50%, or to state it differently, pay out goes from 56.25% of inflation to 16.25% of inflation.
- If we calculate the current HF21 induced 66% drop in price for steem, the effective pay-out for authors is reduced from 56.25% of pre-HF21-anouncement inflation to 5.4% of pre-HF21-anouncement inflation. This is a little over a full order of magnitude.
- The dust treshold is taken after curation, so if you are a low-end dolphin who before the HF21-anouncement could reward a commenter on your posts with a $0.27 upvote resulting in a $0.20 author pay out, after HF21 that same vote won't even reach the $0.02 dust level threshold.
- In effect, about 80% of STEEM users that were able to reward commenters on their post prior to the HF21-anouncement, won't be able to do so after HF21.
There is a simple fix. Simply reduce the dust threshold from $0.02 to $0.002. Doing so would allow everybody who could reward commenters prior to HF21 announcement to keep doing so after HF21.
But anyhow, Steemit Inc neither the top witnesses are willing to even respond to queries about the posibility of making this fix, so I guess it is safe to say the dust treshold is where it is and will stay there.
Now what is likely to happen as a result of that? With HF21 in place, some of the Scot tribes are deemed to be a much more friendly place for minnows and dolphins to put their stake in. On #palnet or #creativecoin, a mere minnow sized stake will allow your single vote up vote to carry some weight, enough weight to have you end up rewarding commenters with your up votes. As such, substantial amounts of both minnow and dolphin stake and most of the social interaction are bound to move to scot tribes soon.
But with the markets having disapproved of HF21 already, can we expect market volume to remain big enough for a mass migration to Scot tribes? Or will minnows and dolphins selling their STEEM to buy PAL/CCC/etc in a possibly dry market pull down the value of STEEM so much that it becomes uneconomical to run a witness node, and we all know STEEM can't exist without witnesses, and neither can (at this moment) the scot tribes.
I feel scot tribes are both a blessing and a risk at this moment in time. Yes, they will help keep STEEM alive as a social platform after HF21 and the dust treshold hit social interaction hard. But on the other hand, with stake about to start moving to Scot tribes once the reality of the current dust threshold value under HF21 starts to sink in, we might be in for a bumpy right with respect to STEEM price and the economic viability of running witness nodes.