Another month bites the dust
Today is Hive power up day and also we just recently finished the Hive @town-hall on Twitter spaces. Was a good talk. The main topic of conversation was a debate about removing the reward pool... which I am vehemently against doing. This shouldn't be surprising as many of the users who earn rewards from the pool have a very large conflict of interest. Still I'd like to think that I'm pretty unbiased in these matters, as that certainly is the case with HBD emissions (I don't earn yield there). The goal is obviously to create as much value for Hive as possible, and everyone has their own idea how to achieve that.
Two of the biggest arguments for removing the reward pool were downvotes and AI. Downvotes make people rage and put everyone on tilt, while AI just keeps getting better and will eventually fool Hive into rewarding content that was automatically generated for zero effort. Proof of brain is dead and votes are already not allocated in alignment with meritocracy, so why not just scrap the system entirely?
For starters my main argument against such an earthshattering transition would be the inevitable hard landing that resulted from such a move. Frontends do not have access to an open source algorithm for sorting and curating content like WEB2 does. A lot of the sorting is a direct result of payout and diminishing returns based on time. That's how the trending and hot tabs work anyway. Removing the reward pool leaves frontends exposed without anything to replace the void.
Another argument I made is that downvotes are a self-correcting problem. We know they aren't a problem because if they were the network would move to correct the problem. Trying to rally consensus to remove the reward pool because of downvote drama doesn't make logical sense. Either that consensus doesn't exist (which it doesn't in reality), or the consensus does exist which means the network has more than enough stake to counter every downvote issued. Both of these scenarios result in a flawed argument. That's a layer-zero off-chain issue on an organizational level.
Artificial int
I find this argument to be extremely flawed as well. What if I created a game on Hive and used AI to create 95% of the game? What if the entire frontend was AI generated and only pieces of the backend were actually coded by a person?
What if I made a ton of money off of this product? Is anyone going to care how it was made? This idea that it's "not fair" to use AI is honestly pretty weird. It's a tool. Is it not fair to cut down a tree with a chainsaw? Real men swing their own axe? Same vibes. Luddites approve this message.
What the AI argument does point to is that content on Hive might be overpaid. We, as a network, might be overpaying our employees and not be getting enough value back in return. Is that actually the case? This is very hard to measure, but if it was happening to the point of scrapping the entire heart of the platform it should be very easy to show with on-chain data.
I'm not seeing that kind of data, just like I'm not seeing it with 20% yields on HBD. I think too many people are employing "this sounds right to me" logic without any hard data to back it up... and the burden of proof is on the users who want to radically change the network, not everyone else. The status quo is the status quo for a reason. Something about not fixing what isn't broken.
Let's see what else.
Khal mentioned several times that he believes ad revenue is the key to solving this issue. Then none of the reward allocations are subjecting and are objectively based on network traffic. I can't say I fully agree with the logic considering ad revenue and data collection are the exact type of WEB2 business models we've striven to get away from, but it is a very good point to say that objective rewards are much better than subjective ones (for one because downvotes become irrelevant in the face of objectivity and there is no 1-week delay).
There was also a very good point made about jumping the gun.
Everyone knows that crypto runs on a cycle. Why try to make such a radical change after already just surviving the bear market? Would we really be having this conversation if number was going up? Just like the HBD debate I have to conclude that these are bear-goggles discussions that only come up due to our emotional reactions of volatile price action. It's certainly not fun to still be trading 90% below peak after Bitcoin just went x2 over the last year.
On that note I'd point out that our blockchain has been around since 2016, and up until 2020 the floor value of the token was basically 10 cents. We've cratered to that 10 cent floor multiple times over the years. That did NOT happen this last time around the block. The local low is 25 cents (briefly at that), which is huge if that's now our new floor. Nobody seems to respect this in the moment but it may end up being a pretty huge deal as we move to greener pastures.
Second layer?
I also take issue with the idea that we can just move rewards and emissions to the second layer. Again the logic just makes zero sense to me. Either the content we are rewarding has value and should be rewarded, or it doesn't. There is no wiggle room here. If they don't have value then no we can't just shuffle them off to some other token and expect them to carry on with a failed business model. These concepts lack consistency and contradict themselves. Make it make sense.
Killing future innovation
A couple years ago there were a LOT of users who thought HBD was a completely failed experiment and needed to be scrapped entirely. Where are those people now? They vanished because we basically fixed HBD with the stabilizer combined with Hive >> HBD conversions. It works pretty great now for anyone looking to swap less than a couple thousand dollars at once.
I'm a pretty firm believer in the idea that this exact same concept is going to extend to the reward pool. Someone is going to create another way for users to generate value on Hive. That new "content" that's getting created, whatever it is, is going to be a lot more valuable than blog posts, and then poof all of a sudden this entire conversation ends because it became exponentially more sustainable.
Again: consensus for this does not exist.
Okay, so you think we are rewarding too many accounts in developing nations? All these accounts are doing is powering down and selling. The obvious question to ask here is pretty simple: why are we collectively upvoting accounts that do nothing but powerdown and sell? And if the answer to that question is because a couple whales decided to... then why aren't we downvoting those upvotes and nullifying consensus?
The painfully obvious answer here is that the consensus is clearly aligned in the way that it is for a reason. Again, the reward pool is one of those self-regulating beasts that does what it does even if it steamrolls over a couple people in the process. I honestly don't even see how it would be possible to get the consensus to remove it when all the biggest participants know they could just change their strategy in the face of an actual problem.
No one is changing their strategy... so I have to assume that there isn't a perceived problem in the minds of the very people who's job it would be to change the code. Although I suppose I certainly could be wrong and more high-profile users will begin to chime in on this issue. I'm betting that's not going to happen but who knows. This discussion would have to get pretty wild over the next few months/years in order for such a transition to even be possible.
Conclusion
Hive, like many cryptocurrencies before it, is a lifeboat that many are clinging to in these times of economic uncertainty. Yes, there are a lot of distressed sellers out there. This is what happens every cycle... and it happens because we all go full on greedy-goblin mode during the bull season.
People don't forget the lifeboat that kept them from drowning in icy waters. There's a lot of gratitude and goodwill built up around us. The people we help today will be the builders of tomorrow... at least that's what I'd like to think anyway. Without the reward pool we lose all of that good faith while opting to throw the baby out with the bathwater. That's my take anyway.
