SMT's: Making them work in real life - Part 1

in #steemit6 years ago

SMT's:Making them work in real life

I once heard someone said: "Keep an open mind, but not so open that the birds can make a nest between your two ears."
SMT's have been a big topic discussed on steemit lately. Some people seem to feel this way:

We should probably talk about what the heck is an SMT? An SMT is a "Smart Media Token", think of this as ERC20 tokens for the masses, made easy, except these tokens
are limited to the steem platform. This is probably a good time to say that the number of steemit users is actually still quite low. At some point I recall Steemit had 600 000 users. From my interactions on steemit and from my personal experience I can attest to the fact that most users on steemit will have a handful of accounts and will possibly helped their siblings or best friends to create users, whether or not those friends or siblings are still on steemit is a topic of discussion for another day. The point I'm trying to make is that steemit is an awesome cryptocurrency and project, but it has a tiny user base and some of the whales aren't exactly very friendly to new users. SMT's might be one of the greatest pieces of technology that was invented in our century, but even if that was true, if nobody is using it, then it will remain rather worthless. Another very important idea to consider is the the diverse user base of steemit, in my opinion a large amount of users on steemit are from third world countries and that affects the economics of steemit imo. (I'm from a third world country: South Africa btw.)

So you would like to read more about SMT's?

What does the whitepaper say:

"Quality user experience comes from tokens that can be transacted safely (through separate private keys for distinct sets of actions), without fees, and at real-time speeds"
This is an interesting point and we can kind of seen this idea implemented over all Dan L from bitshares, steemit and EOS's blockchain projects that this is quite an important idea.
Btw sometimes steemit feels to me like a cult, a cult which I'm kinda part of, it is a nice cult, but any cult attracts a bunch of people who believe in the cult's cause blindly. Bitshares,steemit
and EOS are all built with amazing technology and are amazing projects, but to make them all work and make them work out to be profitable we are gonna need some concrete information to base our
"faith" in the blockchain on. We need to get more people to love and believe in the technology that we believe in, if we would like more people to use it, to do that you will have to be very honest with yourself and others about the history,technology and future around EOS, Steemit and Bitshares.

Lol the cryptocurrency world can produce some of the funniest conspiracy theories that I've ever come accross.
Here are two conspiracy theories that I've heard lately:

  1. EOS is screwing up the crypto economy, the EOS developers are dumping all their earnings from the token sale(in the form of ethereum) on the market and that is why the market is acting the way it is acting lately.
  2. Dan L is behind every big grumpy whale on steemit in order to piss everyone off on steemit so they can move to EOS. Lol.

Btw the whitepaper at this time of writing is 61 pages and like many things everyone says:"I've read it" from page to page, but I doubt that many people have actually read the whole whitepaper.
For the sake of this article I decided to read the entire whitepaper and share my findings with you. I became motivated to do this, after realizing how much meta content there was on steemit, there are tons of videos,articles etc on SMT's on steemit and from watching and reading many of these I have come to the conclusion that many people are really just interested in the hype around SMT's. The real power of SMT's will not be to make money, but instead SMT's are going to in theory bring more quality content and services to steemit. The whitepaper is really really long and detailed so I'm not only going to bother you with the marketing mumbo jumbo from the first few pages, yet it is worth noting that the chapter: "Leveraging Tokens for Autonomous User Growth" mentions: "With SMTs, the entrepreneurs have the flexibility to decide on the economics of the tokens they integrate into their products, from the inflation rates to the algorithms that distribute the tokens". That is interesting, especially considering that so far we have been sold on the idea
that launching an SMT would be easy enough to do for someone with absolutely no programming knowledge.

Something that has been rather vague about SMT's is whether this functionality will be released along with functionality to create smart contracts on the Steemit blockchain. If we look at Ethereum , the ability to create erc20 tokens or any other type of ERC tokens for that matter come from the ability to be able to write smart contracts that will run on the ethereum blockchain. From the sound of it the steemit blockchain will allow for the creation of smart contracts, read the following from the whitepaper: "Regardless, it is clear we have seen north of one billion dollars (USD) raised through ICOs in 2017, and to support this trend, it is possible to conveniently launch and sell tokens via the built in ICO contract of SMTs."

We have seen a great deal of senseless hype regarding SMT's on Steemit. I call it senseless, because all we really have right now is a whitepaper and a bunch of feature requests regarding SMT's, funny enough even the many people creating all this senseless hype probably didn't read the whitepaper. The reason being that most of the senseless hype around SMT's focus on very arbitary aspects of SMT's and mention none of the interesting parts of the whitepaper. Let's be honest, we
don't know that much about it yet(Those of us who didn't read the whitepaper). Some steemit whales like Jerry Branfield have been critized heavily for promoting SMT's with posts that were about SMT's , but didn't contain any new info on the topic.
I don't really have a problem with him to be honest. In fact on one of his posts I asked him:"Does this post contain any new info about SMT's that we can't get from the whitepaper." He replied: "No". Atleast this guy is honest when you do ask the big questions. I also actually look up to this guy to some extent because he is a business man and he is not afraid to hide his Capitalist tendencies. This is a topic for another day so let's get back to SMT's. Jerry you are a good sport:

Something worth mentioning is that an SMT should have a use case to make it have value.
People should be able to buy something with your SMT or to be able to pay for a service with an SMT. If you could pay for bidbots for example with SMT's, that would actually give SMT's some significant value.
I really like the project steemhunt.com , they are issueing hunt tokens for people who upvote comment at the moment and there are a few other ways that you will be able to earn hunt tokens.
It is interesting to see one of the first projects that aims to use SMT's even before it is ready for developer use, here is the whitepaper for steemhunt:
https://github.com/Steemhunt/web/wiki/HUNT-Token-Airdrop-Manual which explains their strategy and plan of action from now till SMT's are available. What will hunt tokens be useful for though?
I guess I would probably know if I read their whitepaper. I bookmarked it and hopefully I will read it at some point. Awesome project btw!

Will I be able to trade SMT's on the steemit dex? How will trading be facilitated? Well there is this funny paragraph that I found in the SMT whitepaper that I really can't understand. If someone in the comments could
please decipher it for me:"By leveraging a recently designed automated market maker concept [2], SMT-based ICOs allow a portion of STEEM tokens received to be sent into an SMT’s on-chain, off-orderbook market maker in order to provide liquidity to the SMT at a specified reserve ratio. Beyond the social and specialized distribution mechanisms of SMTs, this feature advances the concept of automated market makers by pairing it alongside SMT’s decentralized markets, which also facilitate bids and asks by human participants. The combination of these two markets enables on-chain and trustless exchange opportunities for market makers while enabling liquidity for token users." (This section can be found on page 6 in the section about: "Immediate Liquidity")

Another interesting question would be to see how some of the existing steemit projects are going to approach this SMT thing and whether or not it will shape their business to possibly move in a different direction.
For example what if steemmonsters started giving out SMT's for people with certain rare cards or who achieve certain achievements. You could then use this SMT to buy booster packs etc. Btw I like the steemmonsters project, because the people behind it are real believers in steemit, but they are also being honest about their capitalist tendencies. They are good examples of how you can use steemit to make a small income by providing something useful and entertaining to other users of the platform. I also feel that they are pushing the boundaries of what you can do with steemit, even way before we have fancy things like SMT etc. I havn't had much of a look at the technical aspects of steemitmonsters, but I definately think that this project is something to keep an eye on, we are going to see some very interesting things happening in the steemit space with any future developments in steemitmonsters.

Where would I like to see steemit and SMT's going? Right now I feel the steemit blockchain and community is on the verge of something, either steemit is going to pickup a larger user base and will start retaining users at a better rate which should in an ideal world result in a better steem price. The other possibility is that if SMT's aren't super amazing and that people get bored with steemit and move to the next big thing. I'd like to see less greedy whales and more minnows on the site.

Guess what? I'm still reading the whitepaper and not done. It is actually quite a good read. If this post is popular than I will do a follow up post that covers the rest of the whitepaper. I can also do a ELI5 about SMT's if anyone is interested. Thanks for reading!

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