In a comment to @blocktrades post, I said I would provide feedback later that day. That day turned into a month so now it's the time to put my thought on this to paper.
@blocktrades/proposal-reduce-hive-inflation-by-reducing-curation-rewards
At first, I didn't like the change, I immediately thought people would still use an auto vote, because a Nickle is still better than nothing, and then I thought about the imbalance of disrupting the 50/50 which I belive helped make bid bots obsolete. Higher author rewards mean selling votes to become more profitable by a very large margin. We played this game before, and it wasn't a fun game, trending was trash. However we do have free downvotes now, and I do feel with lower curation, stakeholders will want to downvote more to protect their stake.
So in a way, stakeholders will still need to monitor the platform to stop abuse, and sure we can rely on a group or groups of people such as Marky or HiveWatchers to fight spam, but there is still some friction there. By lowering curation rewards, this brings back all the incentives to abuse the platform, which people will, and the downvotes will need to rain in strong and consistent to stomp out any bad habits.
"After thinking about this for a while, I believe this is probably the simplest near-term solution to the economic problem that is currently pushing curators to use auto-vote bots.
Most stakeholders know that auto-vote bots aren’t great for Hive as a whole. But it’s a form of tragedy-of-the-commons, where each stakeholder who doesn’t join in the auto-vote game loses out against those who do.
To break this negative economic incentive, I propose we lower curation rewards to the point where the potential gain from curation is too small to make it worth the negatives associated with using an auto-vote bot. This will bring the situation back to one where stakeholders who don’t want to spend time curating but don’t want to lose out on curation rewards, don’t need to worry about this issue anymore, because the relative loss between the two choices is small. This could even incentivize new stakeholders who previously have decided to pass on Hive or only maintain a small investment because they didn’t want to play the curation game."
Things lowering curation does accomplish, and if lowered enough, a stakeholder will no longer need to vote to compete vs inflation. However, if going this route for the short term, as a stakeholder I would like it if when I didnt vote, my inflation wasn't given to everyone else. I would like to think by not voting I am lowering the overall inflation, combine this with lower curation rewards, it almost becomes a wash, as if I'm not inflating hive from my stake it means I am further protecting my stake from dilution.
To take this a step further, I rather downvote BURN Hive, this will give stakeholders even more reason to use downvotes to fight abuse, and spam can be seen almost as a good thing as it burns Hive and lowers the circulating supply.
If we are to game theory this, in a perfect world you would have no curation rewards and people would simply upvote to distribute the token. They would be wise with their votes as every vote further dilutes their own. Then this could be seen as a cool way to onboard new users, reward good efforts, and build communities without the feeling of needing to vote. IT would be the opposite, people would feel the need NOT to vote, to vote only when important. When you add curation rewards, now people feel the need to vote because of the opprutitny cost of not voting. However, curation rewards in practice also encourage people to seek out good content to vote to avoid downvotes (auto or not.)
So in practice if we removed curation rewards we would see a lot of abuse, downvotes can certainly take care of the abuse but it will be constant work. 50/50 curation if anything stomped out the need to abuse (self vote/sell votes) but it also forces you to play "the game" not every investor wants to play.
So that's the pickle, removing curation rewards means more abuse control, and if the point of removing curation was to ease the burden of the investor, while on paper it makes total sense, in practice I think we will have lots of raising 72o from UTG, aka a lot of people going crazy with abuse.
If I had to make lower curation work it would be as follows. Expand the curation window from 5mins to 1 day, make all curation on the 1st day equal. This means every time a stakeholder logs on, whatever the day is, they can find fresh content to upvote without the need to use Autobots. With lower curation, they won't feel the need to keep up with the Joneses, and curating becomes a much more relaxed effort. I would also remove the curve to bring back micro tipping (a house sell for hive) - The drawback with this approach, as I said before, is bid bots and vote-selling will try to come back and we will need a strong downvote force to make sure this doesn't happen.
In the end, my personal goal would be as follows, keep the "tipping" part of layer 1 for distribution, but find a way to not have to play the game if you don't want without fear of being diluted. This would be getting the cake and eating it too as far as I'm concerned.