Thoughts About Bitcoin & Steem

Trust me when I say I barely hold any Bitcoin. To be honest, I still think it's quite a crappy coin, yet the price keeps going up. This is the wisdom of the crowd. Or madness. Follow the trend: the brand that keeps on getting mentioned, encouraging the rest to go crawling back to master Bitcoin. Yum yum, precious. SHA-256 Proof-of-Work. Burn stupid amounts of energy. Best security - they said. Sure, whatever. Just like a Steem post, here is an example of a Proof-of-Work submission on the Bitcoin network:-

1312af178c253f84028d480a6adc1e25e81caa44c749ec81976192e2ec934c64
e9afc424b79e4f6ab42d99c81156d3a17228d6e1eef4139be78e948a9332a7d8
ae37343a357a8297591625e7134cbea22f5928be8ca2a32aa475cf05fd4266b7

Wow, much value. Yes, it's true blue shit-posting that no one can ever understand, except computers. Many Bitcoin preachers go on and on about putting real hardwork to get ahead in life, but all I'm seeing is the pumping of more and more capital into money machines that churn out gibberish like the above.

Best of all, it's a race to produce more garbage with no real human work being represented in the network, except for human capital being involved in the production of the required computing equipment. Steem is different. It's one of the only networks that's perpetually growing in human capital - just look at all the content on the chain! *Steem zombie preacher mode activated!*

Sure, I'm not denying there's also plenty of human capital as well happening off-chain when it comes to Bitcoin, but that's besides the point because just about every blockchain out there has off-chain communities that form around them. However, it's sensible that Bitcoin is better off than Steem when it comes to sound economics on the surface, although Steem's technology is light-years ahead in every way. It's also a case of perfect objectivity versus leaky subjectivity.

Bitcoin requires initial and ongoing capital investment and will inevitably attract investor types that will likely put profits back into production. This is somewhat at odds with Steem where participants don't really have to put up any material capital and it's possible for anyone to just take all the time without giving back. Steem attracts more non-investor types which is why the network is bleeding more readily than others. But I believe this could be remedied through promoting a culture of investing. It's a more difficult game for sure, but this is why I prefer it. Bigger problems to solve is better business potential. From the point-of-view of the blockchain, Steem is a humanised system filled with stories and friction, but Bitcoin is not - it runs entirely on cold hard capital and objective computing power. Here's the shift of capital risk in Steem's free-to-earn model:-

• Human capital. An intangible form of capital in which marketprice isn't solidified and often misjudged. This means that reward isn't always necessarily given to someone who's invested in the network.

• Voters. Capital risks are shared and distributed between community members. This is why voters should practice more responsibility when it comes to staking up accounts. Investing in accounts that aren't investor types while not wrong, remains to be a source of network bleeding, especially for a relatively small and young network like Steem. The hope is that network participants learn over time.

This is why Steem is a rather different system. The alignment of risk and reward is distributed rather than concentrated. Maybe a better way to frame the difference between Bitcoin and Steem is to think of them as public toilets, in which people tend to abuse and not clean up as well as private toilets. Without requirement of fees for users to use Steem, there isn't any real capital to take care of the facility. This reinforces the point that Steem relies more on culture rather than the Bitcoin's enforced requirement of materialised capital in which a culture of investing is baked-in.

Some ways to improve the culture of investing:-

• Use rewards as start up or complementary capital for entrepreneurial activities.

• Use rewards to invest in other assets, digital or not.

• Use rewards to alleviate the most basic of necessities in order to be productive.

• If clueless, powering up and voting is just as effective.

• We could use more dedication, trustworthiness, and punctuality in the community. I'm guilty of this myself. There's plenty of distractions around the cryptosphere and some of us tend to get unnecessarily busy being involved in too many random projects.

• Spending frivolously on luxury upon a windfall is very poor conduct from a capitalistic point-of-view. This is one of the reasons why most lottery winners usually end up broke, bleeding their own capital reserves before the rest of their network. So.. invest!

_{Image taken from Sapiens by Yuval Noah Harari}

The key is to reduce wastage and non-productivity of resources. When growing the pot, we may turn to the capitalist creed for pointers. It's just a cycle of re-investing profits back into production. Bitcoin miners do this all the time, naturally to keep up with the mining difficulty and turning out enough profits to cover their cost of operations, creating a virtuous (or vicious?) cycle. A great portion of earners on Steem don't have to upkeep any actual investments on the network in order continue earning. So in short, supporting the network is entirely voluntary and the state of the network will only be as good as the culture we build here. This is the price to pay for onboarding everyone and going for mass-adoption. In the end, it depends on what we do with the rewards we get out of this game.

Regardless, Bitcoin's rise is ultimately good for Steem and many others over the long-run although it's being a pain in the ass at the moment for some of us cryptocurrency contrarians. My thoughts about Bitcoin shouldn't be taken too seriously, by the way. It remains to be an indisputable way of contributing and distributing resources - objectively (and we're lacking this in the real world).

Rant over. What are your thoughts?