A few hours ago, @ned and the Steemit INC team announced the SMT (Smart Media Tokens) white paper. A bit intrigued, as you can imagine, I decided to give it a quick browse, so for the last two hours I tried to get the most out of it. Obviously, there are a few parts that I just skimmed through, but I did my best to follow the structure and to identify the purpose of this new development stage.
Word of caution: this white paper is quite technical (there are some parts where you should really know differential calculus to understand what's happening). It's significantly more technical than the recent blue paper published by the same Steemit INC entity, but I'd dare to say it's less technical than the Ethereum Yellow Paper (the one in which the virtual machine is defined).
The Blurbs
This new development stage will introduce the following new features:
- any user on the Steem blockchain (an account who holds STEEM, that is) may be able to issue Smart Media Tokens. Think of ERC-20 tokens and you'll understand.
- these tokens can be issued via an ICO, or "as is". A big part of the white paper is dedicated to the ICO smart contracts, it gets very detailed there and I infer that it's targeting people who, until now, were using Ethereum for their token launches.
- there is a new type of actor (not yet clear if it's a feature, a role that can be implemented or just a concept) called market maker. By implementing ideas from the Bancor protocol, these market makers will act as liquidity mediators between STEEM and SMTs. My guess is these will be functioning like decentralized exchanges, or as "buffers" between various SMT ecosystems.
There are many other, more technical, features, but for the layman, I think these points are the most important.
Here's what I understood so far about SMT:
- SMT can be traded against STEEM, via market makers, or in Steemit decentralized exchange
- they can be used in parallel with STEEM, for any content published on the STEEM blockchain. For instance, if you issue a token called RUNCOIN as SMT, you, as the issuer, may use the same tools Steemit.com uses (reward pool, voting, curation, etc) to reward your users. It's like having your own application layer on top of the Steem blockchain
- publishing platforms are not the only use case for SMTs: an entrepreneur, for instance, may chose to issue SMT as a way to raise capital, and then offer these tokens to his shareholders (I think the term used in the paper is "simple derivatives", but we're getting way too technical)
- almost all the parameters that are set on the Steem blockchain can be set for SMTs: total supply, inflation rate, vesting, rewards pool and so on. It's like building your own, (almost) fully parametrizable Steemit.
All in all, I consider this white paper a disruptive move. If implemented correctly (and by reading the white paper I somehow get the idea that some code has been already written) it will position Steem as one of the most prominent blockchains in the world. Obviously, a significant increase in STEEM value is to be expected as well.
Again, only if execution will be spotless.
Now I'm heading back to reading, because 50 pages is a lot and I really want to dissect everything that's in there with patience.
Expect more articles on this topic in the following days.
For those of you curious, here's the link to the white paper.
I'm a serial entrepreneur, blogger and ultrarunner. You can find me mainly on my blog at Dragos Roua where I write about productivity, business, relationships and running. Here on Steemit you may stay updated by following me @dragosroua.
https://steemit.com/~witnesses
If you're new to Steemit, you may find these articles relevant (that's also part of my witness activity to support new members of the platform):
This really sounds interesting. Appreciate your making the effort to translate into layman's terms.
Looking forward to hearing more from you on this!
Now, forgive me for playing the devil's advocate... but what do the SMT tokens do ?
Isn't this just basically a system for creating 'empty tokens' which will possibly create a whole new 'shady ICO market' ?
I don't see how these tokens will have any lawful status... if I tokenize the Brooklyn Bridge (I already did, see here ) and sell it for a million USD, the recipients will own a token...which is basically like a piece of paper that says 'IOU'?
Why is this revolutionary, and not dangerous considering the amount of shady ICO and subsequent government crackdowns against them? Do we really need a whole new wave of Cakecoins, Durpycoins, MovieCoins, MarijuanaCoins, whatevercoins scamming newbies out of their money?
The difference between shitcoins like Cakecoins, Durphycoins, etc and SMTs is, at least theoretically, that SMTs are already sitting on top of an application. They're created "off of" Steemit. So, if you have a blog, you can literally "inject" Steemit functionality into that blog, by creating your own SMT.
Suppose you have a blog called "pandorasbox" (just a random name) and you want to increase engagement. You create your own SMT, called PANDORA, which will use ALL the Steemit characteristics: vesting, rewards pool, voting, curation, etc. And all people who are commenting on your blog will be rewarded with that PANDORA, using an algorithm similar with Steemit's (quite parametrizable too, if I read the white paper correctly).
Now, this is an interaction and it carries some value. How much "real" value that interaction carries, well that's something that we will find out once the SMT is out there and people start trading it and a price is discovered through offer and demand.
STEEM is already functioning like this, it already has a price, and it gets traded in millions.
Thanks for the response!
So is this only for external blogs that want to use STEEM functionality then? Or can I just create my own PANDORA token (this sounds rather cool!) and hand them out to my followers here on Steemit?
will we be able to trade my pandora tokens on the market place? Will all tokens fit into the steemit wallet?
So many questions.. but now that you mentioned it, opened the pandora's box so to speak, I definitely want to get me some PANDORA tokens. I hear they are the next big thing to blow up like Ethereum..
nope.
yeap.
yeap. and yeap.
Shhhhh...just, come with me please. It's allright friend. No questions.
I'm drawing a total blank.
It's like showing a color blind person various shades of blue.
the nuances aren't noticed.
Hang on, my friend. You're not the only one.
@dragosroua - really appreciate your explanation here and looking forward to more. As a side question - I'm really interested in learned exactly how the steem blockchain works down to the level of how the data is stored on the nodes, what's stored in memory, how the state of the system is represented, etc. I've had a hard time finding anything like that online. Any thoughts on how I could go about getting that level of understanding?
P.S. I have recently voted for you for as a witness, keep up the great work!
Really appreciate the cliff notes here. I know this is a very important development which could have significant impact in the future. I know there's a lot of due diligence needed on my part to completely understand this and look forward to your future posts regarding this.
Did not understand a thing.
Buys more Steem.
Makes you wonder if the million STEEM bought this morning was due to the white paper.
A little insider trading, if you will.
so, what else is new? :)
Different pony, same trick.
I think the buy happened right after the paper, right? So it could've been a gut decision by somebody who saw the paper and was willing to "Gamble" (a pretty safe gamble, TBH) on a big bet.
It happened before everyone started posting things on STEEMit from Ned
(-: We will just wait for the information to matriculate down. Thankfully there are plenty of friendly geeks to translate into human speak / peace
Dragosroua did a good job with the translation I think. It was almost understandable ;) It's like that shitty movie where they are beamed up into a spacecraft that has landed out in nowhere and they have to interprit their stupid "hand-language" behind a glass wall. They're like octopussies or something. Jesus, what a mess of a movie. But like that! The nerds are like the alien-octopussies, and we're humans. "Please, teach us. How can we make money" dioefn390dzinior0 "I think he meant..buuuu y? buiy? biy? buy!! BUY! ztoo? stiie? Steam? Buy steam? What? That doesn't make any sense. STEEM! BUY STEEM! Got it! Thanks nerds! Now go back behind the glass wall and be smart. We will come back later and try to understand more of your secret language after we have either hodleded or tradleded away our money.
:D
:)) you really made me laugh. And I loved that movie, "Arrival".
Thanks :D Oh boy that movie was boring :) I just dreaded through it. When will they STOP with the linguistics. What IS this? A movie for lingustics students? What happened to cool sci fi movies? Blade runner, running man, total recall, fifth element, matrix, alien, 2001 space oddesy..come ooon. Make ONE good sci fi movie before I die. Even Ridley Scott dissapointed me with that "into a cave on the moon" nonsense movie. God was that awful.
Aall righty then. Sorry brah..didn't mean to hijack your post with irrelevant sci fi talk. I had too many after eights.
these are very good movies.
Haven't even seen the movie and know which one it is.
Haahaa! Good one
For a commoner like me, should I be interested in creating my own tokens?
No
Thank you 😂😂😂😏
But you will be presented with more choices, since there will be more tokens / communities for you to choose from.
Really exciting news, maybe the best news in recent months. I'm curious were the price of steem will go from here.
Steem price is up today because of SMT. Correct?
Steem is up because market decided so. Market probably priced in the SMT. Nobody really knows why the price goes up and down. Only the market.
Thanks for the clarification. It's all good for a beginner like me!
No wonder steem is up so much today!
Thanks for digesting this for us. I think I'm a little lost but that might be because this is such a huge thing! Kinda mind boggling, actually!
I was thinking of putting some of my Steem into Bitshares. I still might, but now I am thinking that maybe I should wait a bit and see how this plays out...
Looks interesting. Thanks for the info and the link to whitepaper.
Thanks for this update good to know some cool things about SMT :)
Thanks for the simple explanation. This makes it ckear what SMT does and why it exists. Rather than implementing a content ecosystem on the main steem blockchain and playing by the main chain's rules, content platforms can build their own content eco-systems with their own parameters. And, theze tokens have a way to trade value with other content ecosystems.
This is huge.
This is good. Saves me reading it. Thanks 👍
Thanks for summarizing this for us! Good work.
It's really hard to explain Steemit to people already. Adding another token isn't helping.
You don't have to worry about that part when you're trying to sell it. The average casual social media user wouldn't really benefit from SMTs anyways.