Reward Pool - Understanding the Concept

whatsup (75) in steemit • 7 years ago (edited)

Reward Pool Concepts:

For those of you still coming up to speed, let's get a general understanding of how the Reward Pool works.

The blockchain creates new Steem, these are new Steem that did not exist before.
The new Steem is the reward pool.
Each of us has the ability to distribute those rewards with our votes.
The amount we control is limited by our SteemPower and Voting Power (if we over vote, our voting power goes down)
Every user can use their own stake how they see fit (Upvotes, Downvotes, Delegation, No Action - are a few ways to use it)
When we vote we are allocating our share of the newly created Steem to those we vote for.

If you do not use your votes, your shares will be allocated across the posts that received votes.

The whole thing is kind of beautiful:

If I own it I can do what I want with it. You can react by upvoting, flagging, ignoring, make a post about me, call me names, but you can't change my ability to manage my SteemPower. If you own more SteemPower than I do, you can effectively cancel me out, but only if you are willing to spend your stake taking those actions.

We are currently watching that play out in various ways around the platform.

If you look past the emotions and watch it happen it is fascinating to watch.

Steem is a stake based system your influence on the reward pool is your stake. If you have strong opinions about how the rewards are delegated you may choose to build your stake.

Don't be sad though, if you do not own a lot of stake you still have some tools. "Your Voice" is your best tool when you do not own stake. Use the blog and the comment section to try to convince others to agree with you. (Build Consensus) If what you have to say garners attention and makes sense to other users you may find that your stake grows as well as your social influence.

Participating in the experiment that is Steem

steemit steem rewardpool abuse tools

7 years ago by whatsup (75)

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skeptic (57) · 7 years ago

https://steemit.com/steemit/@skeptic/how-steem-is-really-made

This is how the rewards in the pool are made.
:D

whatsup (75) · 7 years ago

lol, I love this! Cute and now we know.

skeptic (57) · 7 years ago

:D
the truth had to come out sooner or later.
lol

theuxyeti (64) · 7 years ago

i love this. had to take this for my gif library :)

skeptic (57) · 7 years ago

Just make sure to give me credit for creating it.
:P
Glad you likes it.

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oldtimer (75) · 7 years ago

It's so simple to understand. Pure code, or logic if you want. I know that newbies need to learn and understand the whole concept. But it's weird how the people which came on steemit early like us, still don't get this.

whatsup (75) · 7 years ago

I've been watching some of the arguments happening on the site, and I realized many people don't have any idea how it actually works.

Some think they are giving their own money away.

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tamaralovelace (62) · 7 years ago

Concise and easily understood explanations seem to be your forte, always presented with a level head. I like that very much. Watching the digital ballet of current voting/downvoting IS quite fascinating!

whatsup (75) · 7 years ago

Thank you, there is a ton of information and Engineers and Developers tend to be a bit confusing when they try to explain. I have often found that new learners make better teachers on a topic than the experts. So, I am playing with the idea of trying to simplify the explanations.

I appreciate feedback and tips on whether or not it is understandable.

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tamaralovelace (62) · 7 years ago

You're welcome. Yes, it is quite understandable. I also think the manner of delivery is superb in that it leaves the reader feeling enriched. You come across as nonjudgmental and that goes a long way in retaining an open mind and a receptive audience. You're kind of like the Steemit Voice of Reason LOL

serkagan (65) · 7 years ago

You are absolutely right, the voice of each participant is important for our ecosystem and this is everyone's contribution to the pool of rewards! Thank you @whatsup

ebi16 (48) · 7 years ago

Great post. Currently, I accumulate my SP and it feels great to have more influence.

diya28 (53) · 7 years ago

one should keep away such activities ' If you own more SteemPower than I do, you can effectively cancel me out, but only if you are willing to spend your stake taking those actions.'
because we want peaceful environment here , we are a family

adnanrabbani (70) · 7 years ago

Excellent post and i did like to add one more thing, it's true the blockchain produce new steem that didn't exist before just like gold miners dig and produce new gold which not exist before, so as gold produced with proof of work same case with steem, steem also created with proof of work, so steem follow the gold mining concept, it is not produced out of thinhere actually the creator's create new content and then new steem produced on basis of how useful the content is, thanks for sharing your nice thoughts with us, Stay blessed

lifenbeauty (60) · 7 years ago

I did sort of know all this, but you explained it in a so concise way that it became clearer for me. Thank you! : )

dragonking (57) · 7 years ago

In addition to keeping the protocol simple, this use of voting power in one of two reward funds has an interesting side effect of creating a balance point for where to use your voting power most effectively.The comment reward fund is not going to pay out curation rewards. We want good discussion to be fully rewarded.

whatsup (75) · 7 years ago

Currently, there is not a different reward pool for comments although the idea has been discussed several times. I am not for this concept. Each Author can spark and continue the discussion in the comments section. They can vote and reply and keep the discussion going if they choose. In my opinion a new reward pool just causes more difficulty and doesn't create new money.

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dragonking (57) · 7 years ago

Ok..Tks for gave your opinion about this reward pool.

kingsberry (58) · 7 years ago

We are interested in feedback on whether comments and post should each have their own voting power.On the one hand it allows users to upvote each without having to worry about how their votes effect the other category. However, voting power is already enough of an enigma to users that creating another type of voting power could create confusion.

whatsup (75) · 7 years ago

Yeah, I have seen the idea bounced around several times, although I understand why people would advocate for it, I am not for the idea.

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trendo (58) · 7 years ago

Yes! Owning a lot of stake is not the only tool to go around here on Steemit! Opinions matter as well :)

whatsup (75) · 7 years ago

True, but only as well as we are able to influence others with our opinions.

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harleymechanix (61) · 7 years ago

I have a two part question thats been rattling around in my noggin for a few days.

Why must we "claim" rewards?
And if we do not claim them after a certain time to do they revert back to the reward pool?

whatsup (75) · 7 years ago

I do not know for sure why the "Claim Rewards" was implemented. As I didn't see an explanation if there was one. One benefit is that it reduces the number of transactions. If you claim several rewards at once it only creates one transaction in your wallet. I don't have any association with SteemIt, Inc. So, I can't represent "why" they do things. :)

I do not think they go away, certainly not on any short-term basis.

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vieira (63) · 7 years ago

(if we over vote, our voting power goes down)

LOL I always have the SP low.

jeezzle (70) · 7 years ago

I think a lot of people don't really understand how the reward pool works so I'm glad that you wrote something like this.

I think when communities come out we're going to see a lot more commenting of lot more stronger voices coming from people that are speaking from influence rather than just from stake power.

whatsup (75) · 7 years ago

I agree also people can gravitate toward their comfort zones, interests, etc. Each community may be able to set their own tone and standards. Won't that be exciting? I am excited.

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jeezzle (70) · 7 years ago

Definitely. I plan to be a big figure in the fiction Community. I don't know if I can create my own community and have people beneath me........ or if I can just join a community but I would really love to be a community leader if it was possible.

whatsup (75) · 7 years ago

I'm excited to see how it all works. I don't know yet...

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web-gnar (60) · 7 years ago

how does the blockchain create new steem?

whatsup (75) · 7 years ago

I stole the response from inertia he answered this elsewhere on the thread.

[-]inertia (70) · yesterday
It is a fixed amount, for example, here is the current reward fund, according to @banjo:

Total Reward Fund: 716,658 STEEM (Worth: $3,150,429 internally; $3,923,737 on Bittrex)

It is my understanding that this amount is for 7 days of rewards. It fluctuates but typically stays within the same order of magnitude no matter how many people vote

As to the actual mechanics of it, I don't know... Programmers write code and the blockchain complies. I don't have a working knowledge of the "how it works" just concept level.

banjo (56) · 7 years ago

There is nothing we can actually know, my friend.

web-gnar (60) · 7 years ago

lol i thought you were just a bot on steemspeak... didnt know you had a steemit account

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banjo (56) · 7 years ago

That's funny actually, my name was Luna in Spanish class.

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web-gnar (60) · 7 years ago

lol

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banjo (56) · 7 years ago

No it stands for 'laughing out loud' you dummy.

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rewardpoolrape (62) · 7 years ago

You're so nice for commenting on this post. For that, I gave you a vote! I just ask for a Follow in return!

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Show 1 more reply

web-gnar (60) · 7 years ago

hm, yeah i knew it was a huge amount of money every two weeks that got generated... yeah i was wondering if there are miners or does the blockchain mine itself?

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miguelportela (55) · 7 years ago

Steem has all the ingredients to be the perfect platform to benefit from network effect.
Because you need your friends to grow the stake you can influence the reward pool :)

rewardpoolrape (62) · 7 years ago

You're so nice for commenting on this post. For that, I gave you a vote! I just ask for a Follow in return!

ajaxalot (59) · 7 years ago

Hey whatsup, thanks for breaking it down and putting it simply. It's been hard for to me explain how it works to my friends. They have a low level understanding of Bitcoin, but the system steemit is using is new territory for them. I've bookmarked this page and will be sending it to them.

whatsup (75) · 7 years ago

I am happy if you found it useful! Mission accomplished.

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mkmohit (45) · 7 years ago

Thank you for posting dear @whatsup

Well thanks a lot for sharing this with us i appreciate this post but have some little doubts which i think you can help me to understand ...as you said

Reward Pool Concepts

The blockchain creates new Steem, these are new Steem that did not exist before.

So is there not a maximum supply of this token if this gets created everyday then i guess this will just be a pump and dump coin as the Big whale can manipulate the prices in second after searching the coinmarketcap i found out that

Circulating Supply

247,498,958 STEEM

Total Supply

264,473,052 STEEM

but would still like to know your thoughts on this one & how will system work when all the supply will get into the circulation so there will no rewards coming then

Well on the other hand you explained it quite beautifully and simply this system is quite unique and have the potential to go further and scale up too....Thanks for sharing.

Have a great day ahead

Cheers.

whatsup (75) · 7 years ago (edited)

It is unclear if the rewards will always remain. Steem is an inflationary token the details are spelled out in the white paper.

Just because the whales are making money doesn't mean we can't... Cheers back to you.

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mkmohit (45) · 7 years ago

Thanks for your Reply @whatsup

Steem is an inflationary token the details are spelled out in the white paper.

Seems like someone has to understand each line of the white paper anyways will check out the whitepaper and it will be the time to know how things will go on in future ...Thanks a ton again :)

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whatsup (75) · 7 years ago (edited)

from the white paper... But please take a look at the document.
Current Allocation & Supply
Starting with the network's 16th hard fork in December 2016, Steem began creating new tokens at a yearly inflation rate of 9.5%. The inflation rate decreases at a rate of 0.01% every 250,000 blocks, or about 0.5% per year. The inflation will continue decreasing at this pace until the overall inflation rate reaches 0.95%. This will take about 20.5 years from the time hard fork 16 went into effect.
75% of the new tokens that are generated go to fund the reward pool, which is split between authors and curators. 15% of the new tokens are awarded to holders of SP. The remaining 10% pays for the witnesses to power the blockchain.

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kouba01 (81) · 7 years ago (edited)

You describe the whole system gracefully but my concern is that how much steem tokens created daily is it a fixed amount or it fluctuates and how a minnow like me able to evaluate daily amount of the reward pool..

whatsup (75) · 7 years ago

I am not completely clear on the calculation to create the reward pool. I know a few things that influence it. Maybe I will make it my mission to understand it and try to create a "sound bite" post for the calculations.

I am hoping someone will give you advice for monitoring the reward pool. I see it in SteemSpeak on Discord, through @inertia's bot @banjo. I believe banjo does a daily report which includes the reward pool as well.

inertia (73) · 7 years ago

It is a fixed amount, for example, here is the current reward fund, according to @banjo:

Total Reward Fund: 716,658 STEEM (Worth: $3,150,429 internally; $3,923,737 on Bittrex)

It is my understanding that this amount is for 7 days of rewards. It fluctuates but typically stays within the same order of magnitude no matter how many people vote (how's that for a sound bite :).

banjo (56) · 7 years ago

Maybe we are both human beings being fooled by Google!

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whatsup (75) · 7 years ago

Thank you! Not a bad sound bite!

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banjo (56) · 7 years ago

I want to talk to someone else other than you, Savannah.

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youngjerv (54) · 7 years ago

I'm highly thankful for this article, thanks much for this awesome tutorial

durgaani (55) · 7 years ago (edited)

@whatsup...nice explanation bro..but its applicable is dificult...high steem power people having the high sbd vote and low steem power people have a low sbd vote...with out having a power the persons vote to our posts their is no high sbd geberated ..if high power one vote has a more power ... so in my view intially increses the power of our steem and after that this is succeced ...the new user dont now about the steem power and some voting power...thank you for sharing info with us..have a nice day bro

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venox (48) · 7 years ago

steemit is great project. yhx for sharing ♥ following you @whatsup

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zoogataga (44) · 7 years ago (edited)

Thank you for sharing that .the steem stake based framework is extremely marvelous following you ✌🏻

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max1994 (1) · 7 years ago (edited)

Owning a great deal of stake isn't the main device to go around here on Steemit, Sentiments matter also

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sezenke (54) · 7 years ago

So you can distribute those rewards to me by upvoting my comment? I think I understand how to system operate :)

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madushanka (74) · 7 years ago

Well explained @whatsup how do work reward pool. However, every vote on the site is not worth a flat amount of money. Instead, the amount earned is based on both the number of votes an individual receives and the amount of SP a voter has. Have more sp users worth than low sp users in any platform.So better way increase vote power us.To incentivize sort of voting, there is also the curation reward paid out in the form of sp. Author to only vote for content that his believe is high quality.

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darksea (55) · 7 years ago

@ whatsup... Thank you for your advice. I agree with you. especially if we do not have a steem power in the last part, we have comment, we have a blog, we have a pen. They haven' t our hear. we have a heart.

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lordjames (62) · 7 years ago

This whole thing is a lot still difficult for me to grab as a newbie. But I guess with time, patience and commitment I'll fully grasp it.

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racoo (48) · 7 years ago

very good post @whatsup, I really liked it and upvoted it
I am waiting for your upvote too my friend:))

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booster (68) · 7 years ago

This post has received a 13.90 % upvote from @booster thanks to: @whatsup.

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baksi (43) · 7 years ago

thanks for your information on account steemit, there is something to think about, thanks for the post I like

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gduran (69) · 7 years ago

So the reward pool size fluctuates depending on how much Steem is mined?

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aquia10 (52) · 7 years ago

this post was very nice to share with you. I heard the prize pool, but I did not know what it was. thanks for sharing..@whatsup

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steemclaira (50) · 7 years ago

wow thanks for sharing this facts with us..actually i didnt have much idea about how it works here :)

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shencoin (55) · 7 years ago

yeah and i also agree with you and want try to share my voice in my own blog and in others via coments
the steem stake based system is really awesome

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nishaopt (48) · 7 years ago

Thanks for sharing this knowledge with us.I am beginner in this and this is my 3rd week.Still I am learning things.So these posts are very helpful to me
-cheers-

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appreciator (66) · 7 years ago

This post has received gratitude of 1.43 % from @appreciator thanks to: @whatsup.

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rehan12 (73) · 7 years ago

That is what beautiful in a way though but as it seems every thing has a good & bad side of all !

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theguruasia (67) · 7 years ago

@whatsup,
Sorry for the late response! Ha d a long journey and just made to home! I thin my Sister finally made a post @thanya.

Every 3 secs new block generate in STEEM blockchain. In current around 48,900 STEEM generates everyday! This 48,000 divides end of the day based on upvotes and SP!
If greedy whales decided to drain the daily pool, it's a very bad idea! So, we all must rise against such crimes!

Cheers~

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opietaylor (54) · 7 years ago

Thanks for the clear concise explanation!

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magicmonk (73) · 7 years ago

so fascinating :)

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megadethfan (25) · 6 years ago

I read your article and cleared a few confusions about the steemit platform but I have a question which may sound silly but I need to understand.
My Question is accourding to this article https://bit.ly/2JmZ18x the platform is not mining steem anymore more which mean no more steem will be generated and the platform will use already exsisting steem for transaction etc. But now according to you article "New Steem" is still generated so Is it generated through mining
And if yes then Does Steemit is using user's computer devices to solve the mathematical problems and generate money or they are using there own miner for minning?

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alex-linda (42) · 7 years ago

your every post really awsome. i love to read your post and i am really impressed to see your all post... every post really great wish you best of luck thanks for shere this amazing post... keep posting becuse we wating for your post.....love it :) @Resteem

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anik-hassan (36) · 7 years ago

it's weird how the people which came on steemit early like us, still don't get this.

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