Sustainable by Definition
Reviewing the Heart of Sustainability
Welcome back to our Series, Into the Heart of Sustainability. Last week we did a review of the most important of our math basis posts - we are very happy with how far we have come in explaining the inner workings of the SBI program!
This week we are going to take a slightly different tack - to show how sustainability depends as much on legal definitions as it does on the underlying mathematical structure, and how the program was designed to respond to the outstanding legal environment and assure a level of legality.
Do You Know what Steem Basic Income is?
Steem Basic Income is a social experiment to bring a basic income to as many Steemians as possible. Members join by sponsoring others into the program. Steem Basic Income is delivered through providing regular upvotes to member content.
Legal Terminology
You may have noticed that we make quite an emphasis on the use of the term units over the term shares. SBI, as well as many things in the crypto realm, could be in a legal grey area as a new class of technology, and we have made careful decisions about how we designed our service because of that.
We could have designed a subscription service, sold shares in a proof-of-stake mining pool or marketed as an investment in an income scheme, and each would be treated very differently by various government organizations around the world. The rights and obligations that members have, plus the rights and obligations that our service would have, also change depending on the design.
We have seen an explosion of projects on Steem Engine, which on the one hand is very good because it shows that our community has great ideas and lots of spirit. On the other hand, we are very skeptical of any project that claims to have a ‘value basis’, because these tokens could be illegal to sell to any users in the U.S. who are not accredited investors.
Steem Basic Income ‘units’ represent a subscription level to our upvote service; this helps prevent being classified as a security and allows participation from all levels of users from around the world. If we release a token, would this definition hold up? Can a subscription be both transferable and fungible? Legally, treatment as a subscription is much easier to maintain while remaining centralized. As a subscription service, we can also continue to exercise some level of quality control by using a blacklist, denying service to questionable accounts, and using other such strategies.
We only deliver upvotes, and those upvotes may or may not have value. We are not in control of market forces or outside flags, nor the reward pool nor the protocol-level mechanics. Some members have asked for wallet transfers instead of upvotes if they don’t post, but we can not do this because that would clearly convert us to a class of security (and possibly a ponzi, depending on where that money would come from).
We currently have 4800 active members receiving votes at least once per month, and two-thirds of those never enrolled themselves: they were sponsored by others. With equity shares this would not be possible, and might even be illegal.
Sustainability is about more than just math, there are real-world legal implications and risks to consider. Designing ourselves as a subscription service instead of an equity or financial contract is a big part of what makes our program sustainable. These issues of definition affect tax treatment, legal rights and many other factors behind the scenes.
The laws and their interpretations are still being developed by those in power and could change, but we want you to know that being a subscribing member of @steembasicincome is completely legal, and we will work to keep it so - by avoiding changes that increase legal uncertainty and considering potential legal implications with any new changes.
Disclosure: This provides our perspective on the current regulatory environment, and describes some of the efforts we have made to ensure compliance. This is not intended to be legal or financial advice. You should always consult your own financial and legal advisers before making any monetary commitments- whether subscription, investment, token-purchase, drug production upgrades, or whatever!
Writer Bio
This Sustainability report was prepared for us by @ecoinstant.
From a young age, @ecoinstant continues to be very interested in the mechanisms of sustainability, and loves being a part of several teams working on promising projects, including the marvelous Steem Basic Income!
Questions?
Please read our FAQ. If you still have questions, ask in the comments section or join us in our discord channel.
You can look up your current membership levels by using !sbi status in a comment or post, or the similar tool that we have in our Discord server
I knew SBI was mathematically sustainable but am very pleased to hear it’s legally sustainable as well. I do worry about many other projects but it’s great to hear I don’t have to worry about SBI!
There are projects that we worry about too...
2/3 never purchased. Crazy
Posted using Partiko iOS
Yea, I wanna know with my multiple accounts, how many users I sponsored in total.
Posted using Partiko Android
Do we have the answer to this yet?
I am just very happy to the attention to detail that always seems inherent in the SBI initiative... the fact that you cover so many bases, and always "color inside the lines" offers a lot of assurance that @steembasicincome will be around for a long time!
=^..^=
Thanks! While what we're doing may be innovative or even revolutionary, to be sustainable we need to actively avoid being shut down by external forces.
Not sure if the 2/3 is a good thing or a bad thing! I know steemians are generous but damn! I really do believe in this project and think that UBI will be soemthing we look at in the future and perhaps we can take a lot of the learnings from SBI to create a reliable model that serves the people in their best interest
Posted using Partiko iOS
We have a pretty firm base now that will help us gradually grow into a more complete basic income (growing up from the experimental stage).
2/3 is good in that it illustrates that we do have the potential to make positive impact even for people not paying anything to participate. It's also bad because that means 2/3 of our members haven't bought into the vision and made a commitment to boost their own basic income and that of others.
I think the higher the number of participant that never enroll themselves is overall good. You are not meant to be an investment anyway. Also if they are hunting for shares there's a nice chance they are buying into the vision too.
Hunting for shares is a really good point. They may be committed but with fewer resources, and actively entering all the contests instead. That's win-win-win for everyone!
You just planted 0.11 tree(s)!
Thanks to @fuadsm
We have planted already
8314.77 trees
out of 1,000,000
Let's save and restore Abongphen Highland Forest
in Cameroonian village Kedjom-Keku!
Plant trees with @treeplanter and get paid for it!
My Steem Power = 24759.63
Thanks a lot!
@martin.mikes coordinator of @kedjom-keku
This is my all time favorite program. And, it adds significant value to the Steemit community.
I think this mention in your post is very important:
The issue of creating a security is very real. And, while the policing of this crypto space is still in its infancy, there will eventually be sufficient tech and enforces to catch up with all those who may be in violation of various and sundry laws.
Thank you @steembasicincome for a job well done.
!sbi status
The legality of this realm is both unfortunate as well as somewhat beneficial. I see the need to protect people from those who want to steal their money but at the same time when governments get involved, it becomes a beast of regulation that prevents common people from using things to favor those with the money and or legal experience to do so. Kudos to you folks for being very thorough in your understanding of this realm, it is constantly changing I’m sure.
I’ve come to really enjoy the SBI project, hopefully it continues for a long time! It’s great to see that most of the people didn’t enroll themselves, I think it shows the level of contests and generosity of others to enroll people.
Hi @cmplxty!
Structure of your total SBI vote value:
A pending upvote balance is tracked for you in our database. Each time you post, your balance is drawn down by up to 20%. If you post again before that amount is replenished, your next upvote will be smaller. Our minimum upvote for posts is $0.012. Your balance accumulates until a minimum upvote can be delivered with 20% of your pending balance.
I generally prefer a lighter regulatory touch... however the huge number of fraudulent ICO's really illustrates why there is such a perceived need for regulations.
"Obviously the people need protected from investment schemes - look at what they invested in when they didn't have it!"
Yet there is a narrow focus to such thinking. All the supposed sophistication and accreditation didn't stop billions of dollars from being invested with Bernie Madoff. When the returns look good, people have a tendency to look the other way - no matter how much accreditation and sophistication they have.
In fact, the expectation of tacit government approval leads to a lot of intellectual laziness - "I don't need to do as much diligence because the government actively stops fraudulent schemes."
!sbi status
Posted using Partiko iOS
Hi @alfonzo!
Structure of your total SBI vote value:
A pending upvote balance is tracked for you in our database. Each time you post, your balance is drawn down by up to 20%. If you post again before that amount is replenished, your next upvote will be smaller. Our minimum upvote for posts is $0.012. Your balance accumulates until a minimum upvote can be delivered with 20% of your pending balance.
!sbi status
Posted using Partiko Android
Hi @salimbur!
Structure of your total SBI vote value:
A pending upvote balance is tracked for you in our database. Each time you post, your balance is drawn down by up to 20%. If you post again before that amount is replenished, your next upvote will be smaller. Our minimum upvote for posts is $0.012. Your balance accumulates until a minimum upvote can be delivered with 20% of your pending balance.
!sbi status
Posted using Partiko iOS
Hi @cst90!
Structure of your total SBI vote value:
A pending upvote balance is tracked for you in our database. Each time you post, your balance is drawn down by up to 20%. If you post again before that amount is replenished, your next upvote will be smaller. Our minimum upvote for posts is $0.012. Your balance accumulates until a minimum upvote can be delivered with 20% of your pending balance.
!sbi status
Hi @cervisia!
Structure of your total SBI vote value:
A pending upvote balance is tracked for you in our database. Each time you post, your balance is drawn down by up to 20%. If you post again before that amount is replenished, your next upvote will be smaller. Our minimum upvote for posts is $0.012. Your balance accumulates until a minimum upvote can be delivered with 20% of your pending balance.