![ocean-2051760_640.jpg](https://steemitimages.com/DQmaybK32itQbzvHHa2qc3orcTLq6voCLEEzh8Azs9GkxPU/ocean-2051760_640.jpg)

**Posting Rewards**

Not a day goes by where steemians have not engaged in discussion, in one form or other, about the steem reward pool and how it is allocated.  The successful distribution of steem is one of the most important goals for ensuring the long term viability of steem as a network, an economy, a community, a currency and a store of economic potential.  

On the face of it, posting rewards are for posts.  The reward is supposed to reflect the value of the content of the post and the engagement it generates in the comments.  Rewards are weighted by stake (SP), activity (voting power), strength (SP toggle) and total votes cast in an attempt to enable stake or volume to influence the quality of posts.  This is all very new and very complicated so we are all trying to get to grips with the mechanisms involved and to make the system as fair as possible.

But....

There are other use cases for the posting rewards from the reward pool.  These are operating models that offer accounts something in return for their votes and stake weighted reward.  A successful operating model will hope to secure a daily feed from the reward pool from loyal accounts that wish to use their service.  After operating costs and any other overhead is accounted for, the owners of the model will take a fee or percentage.  If their business model is a success, they will secure a reward pool feed that far exceeds the costs of the service and will begin to accumulate steem, steempower or steem dollars.

There are many such services popping up all over steemit, some have proven to be very successful already.  I want to make it very clear that if the rules of the service are clear and followed, there is nothing wrong (in my opinion) with people building creative businesses or services on the steemchain and leveraging the steem community and reward pool.  However I wanted to make this post to encourage further discussion about and bring attention to the possible pitfalls.

* The steemit interface is not very good at supporting complex arrangements between business models of certain kinds and their customers or supporters.  It makes it difficult to fine-tune the model and ensure transparency, fairness and efficiency.
* Large SP holders have a responsibility to create a market pressure with their power to allocate steem via the reward pool is only reaching the services that are the most fair, efficient, valuable and supportive of the steem economy.
* Services that attract a lot of Steemians or whale support will very quickly aggregate steem and SP.  Once they have it, what will they do with it?  Anyone can accumulate influence by buying steem but that is different from Steemains allocating the precious and finite reward pool.  It is important to ensure there is a fair exchange of value when all things are considered.
* The reward pool is there for us to give steem to those who's content we value.  However many services will be built around enabling you to receive back a proportion of your vote reward.  This is a highly centralising force, for example...

I make an arrangement with certain whales to make 20 posts a day of dubious quality or requiring minimal effort.  The whales have agreed to upvote all of my posts.  I will then give back 90% of their reward value, taking 10% per post myself.  Very quickly we would all become blue whales.....no doubt syphoning off as much steem as we could and selling it into the market for as long as possible before outside investors worked it out and steem was destroyed.

That is a worst case scenario I grant you and perhaps it would not come to that because of the transparency of the steemchain and the quality of steemians in general.  The only thing preventing a tendency to slip towards abuse and to climb towards efficiency and value is our combined due diligence as a community.

Turning voting power and reward pool allocation into services and investment opportunities I think is a **VERY GOOD THING**!!  There are so many ways that we can ensure that the entrepreneurs within the steem community tend towards initiatives and projects that have long term value for the steem economy, steem community and steem.  Make no mistake, we all benefit from the success of the steem economy.

One example for how a service might ensure a reasonable relationship between profit and value given back is to simply limit their take.  Once everything is taken care of.....overheads, take, growth (for certain businesses,) burn the remaining steem periodically.  That way every steemian will benefit from the service whilst the business is fairly compensated.  I think witnesses have periodically taken this approach in their campaigns for approval.

We won't get everything right from the outset but I think our approach to innovative uses for the reward pool could make or break steem.

************************************************************************************
Happy Steeming