The size of the pie is fixed, but how it gets sliced is not.
Every day, a fixed amount of money is allocated to the "rewards pool". These are the coins that get distributed to authors and curators for posting and voting on content. When users upvote or downvote posts, they are not adding or taking money away from the rewards pool. They are only changing how the pool is divided.
If there is $7,000 in the rewards pool for the day - then that $7,000 is split across all of the active posts based on how many upvotes/downvotes they receive. If there is a post with a pending payout of $500, then that means there is only $6,500 left to be paid to all the other posts.
"Potential Payouts" can go up or down until the payment window closes.
The amount that is shown next to a post is a "Potential Payout". This is an estimated value of how much money the post will make based on the votes that have occurred so far. Until the payout window closes though, this value can go up or down.
- If a post receives more upvotes, the potential payout of the post can go up.
- If a post receives more downvotes, the potential payout of the post can go down.
- If other posts receive more upvotes, the potential payout of the post can go down.
- If other posts receive more downvotes, the potential payout of the post can go up.
- If upvotes are removed from a post, the potential payout of the post can go down.
- If downvotes are removed from a post, the potential payout of the post can go up.
- If the price of STEEM goes up, the potential payout of all posts can go up.
- If the price of STEEM goes down, the potential payout of all posts can go down.
Payouts are split between authors and curators.
Up to 25% of a post's payout is awarded to curators (the people who upvoted the post) as a reward for discovering the content. The other 75% is awarded to the author. If curators vote for a post within the first 15 minutes of it being created, a portion of their curation reward remains in the rewards pool for other authors/curators.
Stakeholders are voting to decide on how the pie gets sliced.
The platform is filled with tons of users, who all have different opinions on how the posts should get paid. The rewards are decided based on the collective wisdom of the group. Some users may feel certain content is more valued than others, and it is up to them to use their upvotes/downvotes accordingly to spread the rewards how they see fit.
A downvote/flag does not mean you did something wrong.
There are many users in the community who recommend only using the flag/downvote on posts that are abusive/bad. It is up to you if you want to follow this etiquette.
Just because you received a downvote/flag does not mean that you did something wrong. They may have just been voting to reallocate the rewards in a way that they felt was more beneficial to the other active posts in the platform. Often users will leave a comment explaining why they downvoted/flagged, but sometimes they might not. If they left a reason, it is up to you to determine if you did anything wrong, and if there is anything you want to change.
Larger stakeholders have more say in how the rewards are divided.
A user with more SP is going to have a larger influence on the way rewards are allocated compared to users with less SP. If you don't like how a particular user has voted, you can counter their vote by voting the opposite way. If they have more SP than you, then your counter will not have as big of an effect. One vote from a user with a lot of SP can often have more of an effect than 100 votes from users with a small amount of SP.
You can buy more SP if you would like to have more power / influence / say.
The platform does not require that anybody purchase SP in order to participate, and there are many users who have become successful on the platform without investing any of their own money. If you would like to increase your voting stake though, then you have the option of purchasing more Steem Power through your Steemit wallet.
(Image Creative Commons CC0 from https://pixabay.com/)
Remember to vote for witnesses!
https://steemit.com/~witnesses
If you aren't sure who to vote for, check out this Witness Voting Guide.
This is really helpful. I was worried why my rewards are getting low. Now I understand everything. Thank you.
Welcome :)
Thank you for this clear and very understandable explanation. Unfortunately it leaves me with yet another question...
I was thinking about the issue yesterday already and today I more or less accidentally came across a video clip, which confirms my worries. A famous person opened an account on steemit, got the word out and within a day made close to 15,000.- Dollars.
Now, please don't get me wrong, its not like I don't want that man to have it. My question is, what happens, when the real top superstars pop up here? Millions of fans upvoting most of the "pie" to their accounts? According to what you said, it looks like it will just be like in the real world then... the stars and the rich get even richer and the little guy is left with some crumbs..
Or, what if someone decides to build some kind of "vote farm"... supposedly, there are places in low wage countries, where hundreds of "kids" like away all day for fb users buying likes. Could a similar system "harvest" rewards here like that?
I hope you don't think, I'm just some greedy person who is afraid of not getting enough. Although its a wonderful feeling, to get rewarded for quality interaction, I truly enjoy all the wonderful content I find around here and the conversations are much better than on any other social media platform.
If anyone could help me with my questions, put my mind at ease or point out that I'm simply missing something, I'd be very thankful :-)
Really good questions. @stellabelle created a good post several months back talking about that - what would happen if celebrities signed up. To some extent, it is unknown. A lot of it depends on how the community handles it. A lot of what you described is a possibility though. We'll have to see.
Thank you very much for your quick reply and for not making me look too stupid. At least one is aware of the situation. I hope good and fair solutions will be found.
If it wasn't so sad, it would almost be funny how human nature seems to always find ways to ruin a wonderful thing with greed. Hope the community will find ways, to defend itself.
Trying to find the post you mentioned
Those vote farm would require participants with some voting power to have any effect. So the celebrity would need to spend quite some steem to power up his vote farm. Eventually such manipulations would drive the price for steem up. This would ultimately benefit all, wouldn´t it?
Hm... I think I get your point. I thought of the celebrity thing and the vote farm of being two issues of their own. The celebrities would likely get upvoted by a wide range of fans, with all kinds of voting power.
The vote farms I thought, would be a "business" in a gray zone market. The "employees" could upvote each other for a start... just imagine you have a few hundred "kids" doing that and then use their "power" to make money for the "business"... not sure if I make any sense..
I ike the picture, masses of "kids" sitting one next to the other in huge internet cafes and voting like crazy. Like those world of warcraft-players who dig something or earn items in order to sell them to western WoW players with less time but more money. But how to incentivize those mass-voters, when they themselve never get upvoted because they don´t contribute meaningful content? To calculate how much initial vests they need to create a self-sustaining dynamic of a revoting network is beyond my math skills :-)
And then comes in addition the issue with the voting bots which adds a level of complexity...
Understand what you are saying and it gives hope in a way, that it shows other systems haven't been brought down by similar behavior.
When I talked about vote farms I was referring to something I read, when people started to buy likes and fans for their facebook accounts. The article was about what they called "like farms". We are talking about kids in the poorest countries in the world, who'd never own their own cell phone or a computer. If they'd get a fraction of the profits they generate, I think they'd surely enough be highly motivated...
On a different not... may I ask what your profile picture shows?
We will see how it will evolve, if there is a way to exploit or abuse a system (the voting system in this case), unfortunately sooner or later somebody will find a way to do so.
Sure, it shows Takamatsu Toshitsugu, one of the greatest masters in Ninjutsu, and supposed to be the last real Ninja
http://www.angelfire.com/mi/budotaijutsu/Takamatsu.html
He is a model in many ways: self-disciplined, always modest&respectful but very skillful, and deadly if needed
Yes, we'll see :-) I have hopes, that community will "defend" itself though.
Thanks for the info on aster Takamatsu Toshitsugu... I thought it was an aikido master, but the picture is too small for me to accurately judge.
Would be a model for me to! Although I like the philosophy in aikido, where the opponent is supposed to remain unharmed
Thanks timcliff for this article. Helps little minnows like myself understand more how everything is distributed. Also gives me more motivation to keep working harder to create more substantial and worthy content. Kudos!!
Great post!
I was just thinking about this the other day and how much I'd love to see a dynamic visualization of the rewards pool. I was imagining something that showed each post as a circle with the size of the circle representing the potential payout amount. The circles could be all arranged in a column which could add up to to the total current rewards pool. The small payout posts on the bottom would bunch up together with the largest post at the top being the biggest circle. I'd love to see something like that. On mouse over it could show the author, the title of the post, and a link.
Anyone up for building it?
I cant wait for Ai programmers who will be able to take our ideas and do all the programming work for us
Hey, look at that! A user/witness who understands what "flags" are and how the pool works!
Maybe you can teach the aspiring witnesses about this? I don't think they got the thousands of memos.
Hehe, thanks! I'm technically in the "aspiring witnesses" category myself though ;) I'm hoping this post will help a lot of people better understand how it all works.
My plan is to get this up onto the Welcome Page, so users who take the time to review the content there will start out on the 'right' track.
This is a good idea to get it (or trimmed down similar) on the welcome page. I have only been here a couple weeks but this is the first time I felt I have an understanding of what is going on with the votibg and flagging. One thing I can't work out is how to see all voters. It only ever shows the first view and +## but that doesn't expand to view all. Maybe it is just me.
There actually isn't a way through the Steemit.com interface, but if you use steemd.com, steemdb.com, or steemstats.com - you should be able to see more data there.
Thank you for taking the time to answer.
Welcome :)
Great post. Thanks
Another very useful post from you, many thanks! One think I cant discover... if a reader resteems somebody's post after the final payouts have been made on it, does the author receive rewards from the resteemed version?
No. Resteeming is just sharing the post with your followers. It does not affect the post payout in any way, other than giving the post more views. If the views occur after the payout has ended, then any upvotes will not add to the rewards.
Ah, so we need to resteem fast if author is to benefit as much as possible. Thanks for that
Just reading an excellent post of yours from last year..."Everything you need to know about potential payouts and flagging (for new users)" - Could you put me straight: Would it not be a good idea to make old post continue to earn? I think yes! - or make it possible to resteem them to re-activate their earnings for authors and curators and to help get the post back into circulation if it is truly useful and wanted. I believe like copywriter of a good book the author/curators should continue to earn as long as people enjoy the post. Your thoughts on this and whether it would be beneficial to steemit would be really appreciated!
thank you for all your wonderful work!
all the best
It has been suggested/requested by many before. It is not that it is a 'bad' idea, but there are a lot of complications with it. One of them is abusive users can vote for their own post, power down, power up a new account, then vote for their post again. They can keep milking rewards forever without adding any new content. There are some other complexities with it as well, like increasing the amount of computations required by the blockchain to calculate rewards.
Hi timcliff, Thank you so much for your reply... ah i see - i did worry there might be such problems - but worth resolving how ever difficult i think. Perhaps through flagging this could be controlled - Btw this leads to another massive point.... flagging must be dangerous for many users if the other party decides to make problems for them - for the reason i think there should be Steem Police! Perhaps with a less repugnant name like Admin hehe... but i believe users need a higher power that can flag and remove bad users and spammers - without any danger of abuse to users. This is perhaps more important than my resteem comment - your thoughts? Is there such people to contact if one runs into nasty/abusive users?
I have had no problems like this on steemit ... but i have read ausbitbanks girlfriend saying she has been severely harassed by a user nogonoo or similar name, from memory!
thank you for your time!
There is actually - SteemCleaners.
Ah thank you ... i had wondered what they did!
I think your post is very straightforward and helpful.
I would add one last thing to in order to round it out and make it more personable.
If every whale had access to a large amount of emotional intelligence, I think the system would function much better. For example, reducing rewards for someone who just lost their job and who has never trended before with a high payout would have a much higher collateral damage rating than reducing rewards for someone who is currently being well paid and always trends. The additional element of emotional intelligence can make a huge difference in a platform that at its root is SOCIAL.
Hopefully in situations like that, the community/ whales can counter a single bad vote from one whale. In most cases, it only takes one whale to undo whatever action another whale did that the community disagrees with.
What happens after the 7(?) day payment window closes? What if a post goes viral 6 months later? Does the author get rewarded in anyway for that?
No, although if there are new comments made in reply to the post, those comments can get paid out.
Am I right in thinking that they will at least get a reputation bonus? I'd hope they get something out of it (other than regular exposure).
I'm actually not 100% sure on that, but I don't believe it does. Currently the platform is more driven towards building followings and getting more readers for your new content. If an old post went viral, they would most likely at least earn a lot more followers.
a couple of answers for me. thank you!
Very easily explained. Thank you so much.
Thank you for your enlightenment.
I will try to make steem grow.
I would like the portion of their curation reward to go elsewhere and not to authors again... (not to mention that 50:50 would be better in my opinion if not more in favor of curators, just the display should change... The gui must show only the author rewards and when mouse over it should display the current curator rewards)
Thanks for the information - very informative.
Now, is it still possible, with the limited pay-out pool per day, for one person to create a 'super-- post' like the one they talk about where one person made
$15,000 on one post???
The current reward pool is about $6,000-7,000 per day, so the most that a single post could make (if all other posts got $0) would be around $6-7k.
The price of STEEM would need to go up in order for the reward pool to go up to the point that $15,000 rewards for a single post to be possible again. If the price went up to around $1.00 per STEEM coin, then the reward pool would be closer to $60,000-70,000. Then a $15,000 post would definitely be possible.
I think the record was somewhere around $43,000 :)
After HF 17, posts are paid out on a weekly basis and reward pool will contain on average $50,000 and payout an average of $6-7K per day. An extremely popular post (relative to everything else) could still pull in $15K even at today's valuation.
Overall HF17 should smooth the rewards and prevent large posts from dramatically impacting the average payout-per-vote of other posts.
Cool, thanks Dan!
Nice, can't wait for the 7 day rollout :)
@dantheman left a comment in reply to mine regarding the $15,000 payout that you may be interested in.
flagged for disagreement on rewards.
jk
a very good post.
Hehe. I am half expecting to collect quite a few flags over "disagreement on rewards" from the people who disagree with me by the end of this post. All part of the game though :)
Thanks!
:)
About a week ago, I was trying to explain how the rewards work to my son. I came close, but this is much more simple. Thanks @timcliff
Cool, glad it helped! Welcome :)
Good post. BTW:
Both upvotes and downvotes can be removed as well as added, which are four more ways that payouts can change. I'm sure you know this but the post doesn't mention it. Also market value change.
Thanks @smooth! I'll make the updates :)
Thank you @timcliff for a nice clear explanation of "how things work" on Steemit! It has taken me about two weeks of reading bits and pieces to form a picture that's not even as clear as what you just explained in one concise post... so I'd say this is a valuable post! Resteeming.
Awesome, thanks!
Thanks for this very clear explanation. I wish I had this when I first started but better late than never :)
:)
That was well explained. Thank you. Upvoted and resteemed.
Cool, thanks! Glad it was useful :)
Wow, I'm so glad that you made this post because I didn't know why people were so upset when they get few flags. They totally forgot about the other upvotes( a lot of them) and they care about that flag. Why they flag my post? Is not going to flag you forever! And is not going to flag only your post.
It's for a better good for this platform and I think how long whales gave us the money we get every post, we should be thankful enough.
This what the whales did to have that power! How many of us did the same thing? Yes, I know the answer! Just a few, but still people get upset for one bad thing and forget about the rest of 100 good ones! I love this post!
Agreed :)
One small technicality though. A lot of the current whales did earn their stake through being a miner/witness at the very early stages to provide the infrastructure to launch the platform. Not all were cash investments. Many were resources/time.
I agree.
Those people deserved that reward in my opinion because, they were as you said at the very early stages to provide the infrastructure to launch the platform, plus you can't be a witness if you don't have more knowledge about the platform than many others. Great post anyway, and I'm glad we have such great witnesses.
Now, I understand why @ebryans keep promote you as a witness, but I already vote you, so I can't double vote you right? Or can I? :D
Haha, thanks! I really appreciate the kind words / support. No way to double vote, but if you buy more SP the one you cast will have more weight ;)
Yes, I know that but there I can buy also BTS.
I also like that coin, and to be honest I don't know so much about it, but here are a lot of posts about BTS, so I jump in every time I can!
I know, and this is what I'm trying to do almost every day. I'm not a rich person, but the SBD I earn from posting, I send them to poloniex and buy steem. This way I learn a little about trading too, so even if I buy it at a higher price I'm still ok with it because, in the end, I want steem!
Very cool! Did you know that you can use the internal marketplace on Steemit.com to exchange STEEM for SBD?
There needs to be an intro or something for new people to explain this to them as soon as they get here. It is still helpful, but it'd be a lot nicer if we could help them before they get smacked by it for the first time. Set proper expectations.
That's the plan actually :) I'll be including it on the Welcome Page under the "Helpful Posts from Steemit Users" section during my next round of updates.
Nice informative post.
How do you submit an article to the welcome page? i have a couple of posts that i think would be helpfull to new users and would like to submit them.
Anyone has the option of submitting a pull request to the GitHub repository with changes that they would like to be made. There is no guarantee that they will be approved though.
Or, if you send me the links, I can review them, and include them in my next pull request if I think they are good to include.
Thanks for the great article @timcliff! I am a new user, posted some content, but I was trying yo understand, from all the reading, what SP, downvote, upvote and some other things are all about and you made this point very clear to me. I will be looking forward to reading more articles from you! =)
Awesome! Glad I could help :)
Hey Tim, this is an awesome and very informative post. Thanks for writing it!
Out of curiousity, is there a way to know how much of the daily reward pool is being used or to see if the total reward pool is actually being used on a daily basis? Maybe an online app of sorts that I haven't heard of? If not, I feel that this would be very helpful.
I'm not 100% sure if I understand what you are asking, but every day 100% of the rewards pool will be used up.
A while back, @gavvet created this post with a breakdown of how the posts were allocated on a particular day. He might be a good person to talk to if you are interested in getting more data like that.
@jesta also creates quite a few tools that slice/dice the blockchain data. If you talk to him, he might be able to add something to steemdb.com. (It might even already have something..)
Awesome information, thanks for the help!
I guess I didn't realize that 100% of the daily rewards pool will always be used up. Now that you have told me that, your post makes even more sense. :)
Cool :)
Precisely speaking, "every day 100% of the rewards pool will be used up" is a false statement. Actually it depends on voters. Some days more than that, some days less, but on average it's 100%.
Also theoretically it's possible that a post earn rewards accumulated in multiple days. With current rule, when you vote on a post, the payout time extends, so it can "drain" more rewards.
Are you referring to the fact that with the extended payout windows when there is a significant change in rewards, payouts get extended beyond 24 hours?
Payouts get extended after every vote.
Agreed/understood. I was just trying to simplify for brevity. The point you raise is good/valid/correct. Thanks for bringing it up!
Hi there.
I tried to reply to you on something @beanz wrote about you her and @smooth in a post where you talked about curation and flagging, and comments by the flagger, I could not reply there to you guys, (nesting uggh)
Whales that call DV or even considering that to someone who maybe gets a 40 or $50 payout ~once a month really need to reconsider their total "thought process" or if this is curation. It is not. Proper curation requires more than looking at the trending page all day and deciding whether or not that they are going to DV something vs looking at someone's body of collective work over one post, in one place, once a day.
I've been around for couple of months, and I have to say It got cleared for me how the pool works just now :)
I was working on a video about steemit in my own language and this is going to help me a lot
thank you for the info
Cool, glad it helped!
This needs to be a sticky some where
Thank you for this.
Yes, agreed. The plan is to add this post to the "welcome page" content.
Resteemed because we all should understand much better what is going on here with the so called "experiment" I decided to hold back for a while and stop posting. We are still in beta so I wait what's the value of all those recent downvotes @timcliff question : does it effect our reputation ?
It will not affect your reputation as long as the payout stays non-negative. It is my understanding that all of the whales that are downvoting for this are doing it in such a way that it does not harm the reputation score.
Super Tim ! Danke ! I read a lot today and getting kind of excited about it. Let's see ...
:)
Hi @timcliff, I didn't see this post until today and it's full of great resources, thanks! One thing I'd like for decision makers to consider -
regarding the issue of downvoting for the purpose of reallocating rewards more equitably, the BIG problem with this is that downvotes affect a poster's reputation and thus a poor way to go about creating more equity.
It's basically penalizing a content creator for their great work in the past!! Really feels crappy.
As long as the post payout does not go negative, the user's reputation will not go down. If there is any positive payout, then the user's reputation will actually still go up - even if there are downvotes on the post.
Hmm.. ok that's great to know. My rep went down 3 points in about a week or 2 after rising always rising steadily and the only change was hardfork 18 and the new downvotes I was experiencing for first time ever. What else would cause a lowered reputation?
I don't have a good answer, without knowing more details. I've seen GUI discrepancies before, where it didn't calculate the number correctly based on what was in the blockchain. The best place to see if your rep score goes up or down is steemd.com. You won't see the calculated score (67) but you should see the raw blockchain number which should be easier to tell if it goes up or down. You shouldn't see cases where your rep score goes down from a post or comment that is downvoted, as long as the payout stays positive.
Note - if you start with X, then get upvoted worth 1000 points, then downvotes worth -800, you may see your score drop by 800, but it is still 200 higher than before the post. I.e. the net change is still an increase.
Thanks for your response @timcliff, I appreciate it!
love this post
Thanks!
I'd suggest this be stickied. Personally since day 1, I've known that the fluctuating payout amount doesn't matter until it actually pays out. Like what I've said in another post - only count your chickens after the eggs hatch, just like post payouts :)
Yeah, I will be submitting a pull request to add it to the "welcome page".
This is also why recently Steem value has a bit getting lower, money supply or money stock is increasing but the "spiritual" value also called confident or trust has not increased as much as the stock, so the value of each Steem has been getting a bit lower. That's also why some whales who's have been invested in Steem try to decrease the amount created each day, because they loose money (value) even if they keep the same number of Steem/Steem power.
Informative. @kzollove read this
Thanks for the informative post. This will help a lot of people who are new here. I, myself, ignore the reward until the 24 hour or so period closes. That way I don't see a high reward post get dropped or anything like that. I write, engage with others and let the payouts do there own thing.
That's a good way to do it :) Personally, I can't help but to check where my posts are at. It's exciting, hehe.
Honestly, I'm only really able to do that because I'm too busy most of the time to check!
Very clearly put! Thanks!
So much to read. I liked the site better when all we had to know was ...
"Post, Vote, get Paid!"
;)
KiSS
What a great explanation of the rewards pool. I've learned a lot from you and your informative posts!
@kus-knee (The Old Dog)
Thanks :)
I think this just clears the air the more people mean pie pieces get smaller.
Lol, this is a great post! And you have a way with words which is definitive. If someone does not get it after this, he never will! :)
Thanks! :)
Thanks for exploring the mechanics.
Welcome :)
Thanks for Sharing very Good Info
Upvote y Resteem
Cool, thanks :)
Yep. That's a flawless post!
Thanks! :)
U/V and RS good job!
Cool, thanks!
Awesome! I feel like these things need to be repeated from time to time. Well put out!
Thank you so much. I am a newbie.
Welcome :)
Thank you
Excellent work as always @timcliff sir, very good information thank you very much
Welcome @jlufer! Thanks as always for supporting my work :)
Very helpful information. Thank you!
Awesome! Participation is key for this type of platform to work. Great post.
Thanks!
non-linear larger influence, isn't it ?)
Yes, that is true. The proposed changes in the upcoming hard-fork though (HF17) are going to make it more linear though.
You're spot on, of course, and I have long supported the use of downvotes to express a negative opinion; and changing the Flag to a Downvote as it used to be. Exclusively upvotes and positive reinforcement is unhealthy - there needs to be a diversity of opinion for any robust community.
That said, I'm on the fence now about flagging. It has proven to be deeply unpopular to the wider community, and we need to respect that. I doubt as a community we are ready for it just yet. It'll need a major perception shift and some UI changes that makes downvotes appear as normal and banal as they are on Reddit.
Having the 'flag' and 'downvote' combined into the same function is a large part of the problem. If we would be able to separate those two out and define "acceptable use" policies for each, I think that would sort out part of the issue.
There are always going to be users that get upset if/when part of their reward is removed due to a downvote though. I don't think there is any platform fix that can be made for that.
Yes, making a downvote a downvote and defining their use clearly is certainly worth a shot.
Of course, someone or the other will always be upset, but we can do better.
Based on the feedback that I've seen from the devs, this is something on their radar that they are planning 'eventually' but we will probably need to live with the current implementation for a while.