Since my initial impressions post, we have a lot of information. I have also taken the time to research on Justin Sun and Tron. Justin Sun made a post, which is still trending #1. I made a comment on that post (and many other community members felt similarly) appealing for cancellation of the token swap and explore better ways to transition. I'm happy to see that our voices were heard, and Justin made the correct decision.
First, a bit about Tron and Justin Sun. Looking online, Tron seems to have a very polarizing reputation. Some people love it, while others regularly mock and hate on it. This reminded me why I don't really follow the altcoin space, there's just too much noise and tribalism. The reality, as usual, is somewhere in the middle. Justin Sun seems to epitomize the concept of "fake it till you make it". That may seem derogatory, but it's a legit way of building a company or ecosystem. As of now, it seems like Justin is making it. Tron is a legit, working blockchain. We all knew the drawbacks of DPoS before, but EOS has had so many issues and challenges, there's now clear evidence that this is not a sustainable solution long-term. Whether so-called "third generation blockchains" like Cardano and Ethereum 2.0 can solve this scalability vs. sustainability problem remains to be seen. Signs are promising though.
Anyway, Tron. I have said many times before that the "fundamental value" of a blockchain has very little to do with metrics like, number of active users, number of dApps, number of transactions etc. It's all about the economic activity. On that note, Tron leaves a lot to be desired, falling far behind bitcoin and ethereum, and to a lesser extent even EOS. Still, in terms of market cap, Tron is currently worth $1.61 billion, which is nearly 20 times greater than STEEM. So, let it be very, very clear - Tron is a much, much bigger deal than Steem.
Application specific blockchains seemed like a good idea in 2015, but they suffer from one showstopping, deal-breaking problem that has become all too evident - i.e. the lack of network effects and economies of scale. These are well understood concepts that have held true through centuries across pretty much all industries and platforms. Evidently, crypto is no exception. Even today, the rational choice will always be a Layer 2 solution on ethereum with Optimistic Rollup or whatever - the economic network effect it has built over the years is formidable and nigh insurmountable in the smart contracts space.
Now, I know, some of you have very heavy STEEM bags, and it's natural to be be outraged at my heresy towards DPoS and such. Please, for a moment, be rational - the crypto economy is clearly consolidating in a different direction and has been for several years now. If not, let's just agree to disagree and move on as this discussion is about Steem and Tron.
Back to the live stream. It was one of the most boring, poorly prepared, poorly presented live streams I have ever seen. It was mostly fluff and Justin & Ned massaging their egos (anyone else cringed hard when Justin said "Someone on Twitter is saying Justin is GOAT" and Ned retorted by saying "Someone else is saying Ned is amazing"? Damn.), but there was also some good information.
It is now obvious that the announcement was rushed to steal the thunder of EOS' Voice beta launch. It is clear that Justin & Tron did not do their due diligence, had no real plan, and just cobbled together whatever they could by Feb 14th. Also clear is that Justin did not understand the complexities of Steem, and probably still does not fully.
The good news is there has been a lot of positive progress in just 24 hours between the initial announcement and the live stream. The token swap was greatly unpopular and has thus been called off. The current plan is that... there is no plan whatsoever. While that sounds disappointing, it's still better than a bad plan. So, we are going to maintain status quo for the short term, but make no mistake, the goal is still to integrate Steem with Tron. Obviously, they don't know how they can do that just yet, and it could take several years to materialize. I think this is probably the best case scenario for now, but of course, the jury is out till Tron can decide and announce their plans. We'll evaluate those plans separately as and when they come.
Let's be clear - Steem has been dying a slow death since 2017. I don't mean it literally, of course. Under the current regime, Steemit, Inc. have proven to lack any vision, and the 2018 layoffs have meant glacially slow progress. To be clear, I highly respect the developers at Steemit, Inc. - they are decent, talented people doing their best given the situation, but they simply do not have the resources to maintain and develop a major social network. Meanwhile, Steem witnesses by and large haven't been able to aid development either. So, Steem wasn't going to die - of course, not - but it was destined to remain a niche community. Economically, STEEM price was always going to degenerate versus bitcoin, due to the high and "dumb" inflation, save for the brief pumps and dumps. If you still think Steem is going to be a "Facebook killer", please, let's just agree to disagree, I don't want to go there.
Will Tron "save" Steem, then? Who knows? But one thing's for sure, Tron has far more resources than Steemit, Inc. ever did. Justin Sun is also a formidable marketer and shiller, something Steem has never had. Will Steem improve under Tron? I don't know. But what is quite likely is it'll be a more active community when Justin is done exercising his shilling prowess.
Finally, Communities are launching next week. I have been asking for this feature ever since I first joined Steem/it. Some 2016 Steemians may remember I was one of the most active users of the chain through mid 2016 and early 2017, but I significantly decreased my activity through 2017 and by early 2018 I was mostly inactive. Many have asked me why I chose the height of euphoria to mostly-leave - there are several reasons. But my greatest disappointment that signaled this network is gearing up for decline was Ned's statement on 28th April 2017 that they are aiming to release the Communities feature "by the end of q2", just two months later. At the time, we knew Steemit were pretty slow and their dates unrealistic - much like all of the blockchain space. I even joked that, "Note how he neglected to mention the year. It's probably going to be Q2 2018." Of course, I received a fair amount of hate for suggesting Communities is not coming before 2018. Oh, how wrong I was. Even me, the hater, the pessimist, was way over-optimistic. I knew then, by late 2017, early 2018, that I should cut my losses (in time, not financially, obviously the price was ATH then) and spend my free time elsewhere. All of this is a long winded way of saying is Communities is very important to me, personally, and I'm happy to see it finally launching next week. I don't believe it's ready for production in its current state, but after such a long wait, something is better than nothing, I suppose.
All in all, here's my TL;DR, because this post is way too rambly and I don't expect anyone to read it:
- Justin Sun knows marketing and seems like a reasonable bloke. They have made the correct decision to cancel the token swap and maintain status quo.
- Be rest assured, however, that this is a short term thing. The long term plan is still absolutely for Steem to merge with Tron in some fashion. Fortunately, it's probably going to take several years, and hopefully it'll be a smooth transition. A split is inevitable, despite Justin's best efforts and intentions - smart and resourceful witnesses will consider a fork, especially now that there's some time to figure things out.
- Tron is a far bigger deal in the crypto world than Steem, they'll bring considerable resources and marketing to Steem. In the future, Steem may not resemble the Steem you know and like today, but it'll be almost certainly be a more active Steem. Or whatever you may want to call it.
Finally, the elephant in the room - what about STEEM price? No comment. I'll continue shouting, like I have for years, that the inflation must be reduce significantly.
As for me, I'll continue to follow and see how Steem evolves. It's been a helluva ride. I'm going to remain mostly-inactive / sparsely-active, as I've been since 2018, with some bursts of activity like now - so nothing's going to change on that front. I'd love to be more active, if/when the experience improves dramatically.
I agree it was clear they do not have a plan, the live stream was painful.
They are way bigger and Justin Sun's net worth is estimated at 800m. He has more visibility, credibility and experience. They are bigger than us.
While they can't buy the chain, they bought a great portion of stake and SteemIt Inc of which we have been nearly entirely dependant.
I just hope our witnesses don't pull any stunts as the witness meeting following on PAL and discussions of forking out their stake were even more painful than the announcement it's self.
Things could go well, they might go poorly, one thing is certain, they are going to be different.
Frankly I hope he does install a few of his own people to learn the ropes.
One of the most interesting revelations from the stream was that Ned owned 51% of Steemit Inc, and he sold all of his stake to Justin / Tron. It's very surprising that he revealed such a detail! So, despite the "collaboration", "partnership" type jargon, it's pretty obvious that Justin has controlling interest over Steemit Inc.
Haven't followed the witness meetings or whatever, but yeah, not surprised. As I mentioned in my post, all smart witnesses should be considering a fork right about now.
Tron will not care about their fork. they will not have SteemIt Inc, which we are mostly dependant on.
They will have no funding, no marketing, no exchanges...
I mean it could be fun, but it will not impact Tron.
Yeah, definitely. All witnesses combined are not even a fraction as powerful or influential as Justin. In fact, outside of Blocktrades, I can't think of any that have any lasting entrepreneurial experience in the industry. Still, for witnesses, they are probably going to lose their jobs eventually anyway*, so might as well try and get their own thing going instead.
*As of now, the long term plan still seems to be Steem merging with Tron, and Justin already has a cabal of witnesses (superdelegates, same thing) set up there. Of course, there could be compromises found, such as keep Steem as a Layer 2 or sidechain for Tron etc. We shall see how things play out over the coming months/years.
Thank you for this speck of insight.
Set sarcasm to max: We had Jerry Banfield, right? Is he on the same level as Justin Tron?
So long as Steem retains its essence, an immutable, censorship resistance ledger where what you say is forever (so long as the chain runs) - I don't care what it runs on, even if its watercooled toasters in an olympic swimming pool filled with... well, I'll let you decide what nature of organic molecules could be in that pool. :)
Justin seems genuinely enthusiastic and believes in nature of cryptocurrency. He's a hype-r, and shiller, for sure, but its good to have someone like that with a significant stake.
That, or we should fear the inevitable "write off" if he predicts a further descent (if viewed from a traditional acquisitions and mergers corporate balance-sheet point of view).
I had forgotten who Jerry Banfield was, but now I remember. Sarcasm aside, lol, no, Jerry Banfield shilling expertise is amateur level compared to Justin Sun. What Sun and Tron have built is on a very impressive level - literally a multi-billion dollar network.
I had tron sub-100 satoshi - moved a lot of that into Steem at a specific point in history.
I'm camping out on both sides of the fence. I just want the platform's essence to be the same as is it is now, I don't call what its called or what it will run on, as per my earlier comment. :)
Never held any Tron, and didn't really know much about it before the rumours of them buying Steemit started circulating late last year. It's only in the last couple of days that I have read up about it.
I'm not precious about it, at this point I just want to see a social media experience that is at least as good as what Reddit offers, while retaining some of its unique properties. Currently, it's just bad, it's slow, there's hardly any activity or engagement, the tokenomics is unsustainable etc. etc. If that required cutting back a bit on "purity", I'm open to it.
I did buddy :^)
I like your overall perspective on this, it isn't reactionary & it isn't fan-boy-ish. Just straight down the middle with logic.
While we may disagree on the potential of Steem ( I like the sound of Facebook-killer ;^) ) I understand where you're coming from.
In terms of the inevitability of Steem mergin into Tron, I'd like to throw out the reminder that it is entirely possible this "merger" won't be like when I merge food with my face & swallow it whole. It could end being that Steem acts as a sort of
side-chainsister network to Tron. Scalability, as you mention, is going to be a devil to get right. So why should we keep trying to scale a single chain? How about multiple chains built to handle their specific necessities, while having a super smooth bridge between them.ie, Tron is for gaming & smart-contracts, Steem is for blogging & upvoting. Maybe Steem will act as a name service tool for Tron's cryptic wallet addresses, with users being able to link a Steem account to a Tron address. Maybe Steem will become the open social media standard that Twitter has recently proposed, and Tron will act as a point of contact.
Lots of possibilities, which for me is the best time to be involved :^)
Yes, I mentioned it in other comments that it could also end up being a layer 2 or sidechain for Tron. What we do know is they will integrate Steem with Tron in some form or another, they aren't going to keep developing it in parallel.
The reason why it makes sense to build one network is because all resources can be combined into scaling and developing one protocol. Note: One protocol obviously doesn't mean just one chain, e.g. Ethereum 2.0 is going to start off with 64 shards (basically, sub-chains) that execute in parallel, with a view to increasing it to 1024 in the future. One protocol is also a combination of layer 2 solutions, sidechains etc. See what I said about network effect and economies of scale. Tron don't want to waste time building a second protocol, they just want to keep developing Tron as the one platform to do it all. Of course, this can take many forms, like you point out.
There are certain exceptions with very specific case blockchains, but even then, it makes a lot of sense to be layer 2 and sidechain, and leverage the network effects of a consolidated platform. By the way, Steem is not it, there's nothing special about this chain - it works like any DPoS chain. The only difference probably is that it stores a lot more text than transactions / contract executions than your average blockchain, but technically that's a non issue.
I'd definitely have to disagree on that one. The tech behind it is actually really genius. Lots of graphene innovation has come from Steem, lots of additional features to match the ever online social media world, and overall it has a lot of concepts adopted into other places.
Looking towards Ethereum for comparison, their sharding methodology is vastly underperforming. They predicted what? 5x less shards with 10x more output? But that was no where near the case. Ethereum has a loooong ways to go tech wise, EOS has a loooong ways to go decentralization wise ( and currently usability wise ), etc.
Tron, and Steem, both have problems. But from what I've researched we are positioned to iterate faster than the competition and even in our less-than-perfect state we're still outperforming half the other chains out there ( more than half, but I don't wanna suck too much Steem dick tonight ;^) ).
Steem may not even be a "sidechain" as we know them today, perhaps it'll be more of a "complementary chain". No "one chain to rule them all" ideology, maybe the best bet is to allow multiple networks catering to different areas. Steem would be virtually untouched in this case.
Yeah, we'll have to agree to disagree. EOS 2.0 is vastly superior to Steem at this time. Which should surprise no one, because Steem has hardly seen any development in the last 2-3 years, whereas EOS has taken the Steem codebase from early 2017 and poured in probably 100x development resources to improving it. Meanwhile, Steemit has spent years chasing a scalability rabbit hole which still remains unsolved with the broken/limited MIRA implementation which no one uses. I rejected HF20/21 for a variety of reasons, but one of the reasons was the pathetic state of affairs with Steem development. Mind you, all of this is fixable. I don't know enough about Tron yet to comment. In general, as I mentioned before, all of these DPoS chains - EOS, Steem, Tron - are fundamentally flawed and unsustainable.
As mentioned in my post, Ethereum's Layer 2 solutions are already excellent. Optimistic Rollup is capable of hitting 2,000+ TPS, which firmly puts it in EOS/Tron territory, all of it without cluttering Layer 1 with unnecessary data, and of course, the DPoS challenges. Loopring powered WeDEX is even better than NewDex on EOS, and light years ahead of Steem Engine or the internal Steemit market. You even have DPoS-based layer 2 chains like Loom. Ethereum 2.0 is well on track to offer all the scalability Layer 1 will need for the near future without any of the fundamental compromises of DPoS, but of course, it's still a couple of years away. Same applies for Caradano, but I fear they're too late.
But the secret, of course, is that scalability is a red herring. What makes a blockchain successful economically is high value transactions. High volume, low value transactions are ill-suited for Layer 1 blockchains in the first place.
You're probably going to disagree with everything I've said, and that's fine, let's move on.
This
I wonder to what extent this is, in a practical sense. I suppose its obviously worked so far, but from what I can tell he already had significant backing from his 富二代 upbringing (rich second generation being born from within the riches of the previous generation's economic boom in China), so I wonder how much of his direct marketing has succeeded vs raw spending.
And, from what I can gather, Tron is extremely dead outside of gambling apps which implies another element of failure, no?
I guess I still need to look into his successes. I've only read about how he's a sociopathic/narcissistic criminal so far
Fair points. Firstly, Tron does have a large following. Looking at social activity on Santiment, it's one of the most talked about alts, outside the majors. Its $1.7 billion market cap and hovering in and around the top 10 on CMC also suggests it has plenty of money invested in it. These numbers all suggest there's orders of magnitude more interest in Tron than Steem or most altcoins.
Of course, dApp adoption is a different thing. Here, there are two aspects - users and economics. Like I said, it's all about economic activity, DAU numbers don't matter until it hits a critical mass of several million which no dApp is even close to. Let's face it - the only reason not to build on ethereum is you have a large volume of transactions but very, very low value for each. Right now, this is basically just gaming, gambling, DEXs and other niche apps like Steem-style social media. With Layer 2 solutions like Optimistic Rollup now live on ethereum, there's even less reason too; and by the time Ethereum 2.0 Phase 2 releases in a ~2022, it'll be an even smaller niche.
In the here and now though, Tron has built a decent economy around gambling dApps. You can scoff at gambling, but economic activity is economic activity. You have some pretty active gambling dApps like Wink which alone have greater economic activity than all of Steem combined. Yes, Steem has more users than Wink, but it doesn't matter - once again, it's all about how much money is flowing through the platform. So, yeah, Tron is a solid 3rd place behind ethereum and EOS.
I don't want to comment on Justin Sun's character or Tron's reputation - there's undoubtedly plenty dodgy things happening there. I'm just focusing on the objective merits, and yes, Tron is a legit player in the crypto market today, for whatever reason, by hook or by crook.
PS: Tron USDT actually has $850 million circulating, which is an impressive figure too.
Gambling certainly shouldn't be downplayed in terms of its economic value - here in Australia, an entire Casino was planned, built, and exempted from local and state planning laws in order to lure more Chinese gamblers to Australian shores for gambling holidays.
This largely removes my need to go digging up intel myself, cheers.
When you say 'In the here and now though' - Is that to imply as things stand, the Tron handover is only relevant for the next couple of years, or is it good to adapt?
By that I meant Tron's future prospects as a smart contract/dApp platform, not the Steemit/Tron deal. I don't really see Tron being adopted as a dApp platform aside from niche cases like gambling, in the long term.
I was a bit taken back by the fact that Sun put the settings on the recording of the AMA such that it couldn’t be shared/viewed on external sites / Steemit - a move that practically equates to censorship, making the content inaccessible on Steemit... but hey, I might be overreacting, and he might have had no idea what he was doing there. 🤔
In any case, it’s been interesting seeing what strong reactions there’s been to this and the immense divide of opinions.
Gotta say it’s somewhat reassuring to hear here that he did take this community’s feedback seriously and let it guide his decision regarding a token swap. For sure, there are tremendous benefits that could come from the partnership - and its at least one step in the right direction that he’s including this community in the strategy moving forward...
Yeah, I wouldn't read too much into that, plenty of YouTube channels have that setting for a variety of reasons.
Very interesting (and somehow funny) article! Thanks a lot.
Justin of course will also have much fun with our awesome weird community.
Steem on. I'll stay here until the last witness node is shut down, lol.
!invest_vote
Heh, I'm glad you found it funny. I have no great loyalty to Steem, but I still want to see it succeed.
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As for the TRON and STEEM interaction / interaction making a sidechain and issuing tokens can be done. That could provide the necessary interoperability without killing STEEM token. If there is good marketing and some reasonable enhancements to communities there is still hope ...
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Yes, that seems like a reasonable solution, but I doubt Tron will continue to maintain two different chains, even if it is a sidechain or layer 2. We shall see how it turns out. One things for sure, marketing is going to be infinitely better. (Because it's zero now!)
Yes - two different chains is a difficult scenario. Unable to make more comments here as I know next to nothing about TRON apart from some thing like its like Etherium (not sure about how its EVM counterpart works and smart contracts etc.)
May i ask you one thing? In case steem stakeholders decide to decrease inflation, just enough to pay for the witnesses, what would be unique value propostion?
Economic incentive is what basocally makes this place more interesting. Of course, I'm refering to normal users who simply dont give a shit about decentralization or forks.
Do you think SMT's should fill the gap?
Economic incentives can still be offered, but in a sustainable manner. E.g. an advertising system can be built in, so people or companies can pay money to boost posts, and this can be returned back to the content creators. Let's be clear, Steem is never going to appeal to normies in its current state. And while the appeal of getting free money is interesting, it is totally unsustainable, as has been evidenced by STEEM price crashing throughout its history except for a couple of months here or there.
as far as you're considrned, the inflation rate should be around how much exactly? 3%?
It's something that needs to be researched, but 3% seems like a good figure.
with all of the tron noise I hadn't heard a peep about Voice, cept for the overlap details 😂haven't seen the livestream yet i'll take your word for it, apprec the review
Lol, Voice is pointless. Dan Larimer still totally clueless about social media.
I'm hoping the entire concept of a token swap and killing off Steem is cancelled. Forever.
I'm hoping that with time, and growth alongside the community, he sees that it's better for everyone if Steem is left to remain independent and off Tron.
Connecting the two in other fashions is a different thing entirely, and there could be many ways in which it can benefit us.
As you mentioned, the token swap and move to Tron is clearly still the long-term plan, but I'm hopping we can change his mind on that and show him why.
Unfortunately, a merge with Tron makes sense. There's no point developing two different chains when they can focus on one and leverage its network effects. The other option is just leaving Steem as is, but then it's going to keep going on the slow death spiral it has been on since 2017. So the best option for the survival of Steem is still merging with Tron in some fashion and leveraging their investments and network effects.
This might turn into quite a long comment, sorry, haha.
I'm unsure about the first part for one main reason: surely Tron already had the resources (people and funding) to create their own token system which is similar to Steem. They could've built something from that ground up that could've rivalled Steem in many ways. An interesting question to have from this is whether Tron actually needs us, or if we need them.
I feel the answer is quite even. They probably need us as much as we need the investment and PR. This brings me to the next part:
It obviously entirely depends on what's planned, but having two separate chains could be mutually beneficial. With existing users on Steem, building this chain and finding ways to connect Steemit's front-end to Tron could grow two individual market caps in an industry that's largely sticking to individual ones. Take their acquisition of BitTorent and the implementation of a TRC10 token: it's practically dead.
With Steem not becoming a TRC shittoken and remaining independent (ignoring minor features that connect to Tron and its ecosystem in some way, strictly referring to independence as Steem staying on its own chain) then Justin has the leverage to push one positive over the negatives from a marketing aspect. It also allows for a plethora of announcements that benefit both chains.
Another thing that comes to attention is that surely there'd be little point in releasing more features to Steem: communities, SMTs, etc, if the plan is to ultimately kill it off and start from scratch.
I do have a few more things that could be said, but I think I'll just throw in some bullet points. With one final thing: I think Justin isn't entirely aware as to what he now owns. I think he has a rough idea, but not one large enough to fully understand what it's capable of and who really is in control. Those are questions the community is asking as well.
There's no way to sugarcoat this - Tron is a massive, $1.5 billion project, hovering in and around the top 15. Meanwhile, Steem is a failing project that has dropped from the top 10 to barely hanging on to top 100. Indeed, were it not for the Tron acquisition rumours, it'd have dropped out EOY 2019. I have noticed way overinflated opinion of Steem by bagholders, and its frankly delusional. In the wide crypto community, Steem is universally thought of as a once promising project that is failing through mismanagement and poor development. So, yeah, the answer is Tron >>>>>>> Steem, it's not even close.
Steem will be integrated intro Tron, though the timing and nature of it remains uncertain. I bet it's going to take a couple of years, but they'll figure it out. I'm not entirely familiar with Tron, but one thing's for sure, they have an order of magnitude more developers than Steemit Inc ever did.
Great to hear from an old legend, the OGs of steemit should really weigh in here. To newer accounts like me it looks unsettling now, with this transition. It's like being handed over to a less caring step parent, by your negligent parent. TRONsun won't care as much, will work you harder for their profit and won't take your concerns to heart unless it suites them.
On the sunny side, if the shiller promotes steemit as the social media platform to rival Voice, then we may be onto something. Overall we will just steem on, power up, post and profit, until something stops us. So far so good. Though it is still only day3.
I don't know, it feels hard to beat the negligence showed by Steemit Inc and the witnesses over the years... Still, one thing I have learned from my time on Steem is that every time you think it has reached a bottom... anything is possible.
Yes, it's best to just keep doing what you're doing.
One time