I have received the torch from @pboulet (thank you, Pierre) and thought of doing something useful with it. Indeed my first temptation was to pass it to one of my colleagues from the ex-EFTG team, @pstaiano, @jga, @smartiot, @christophe51 or @elias.mic. But that would have served little purpose.
Lately, I had the opportunity to talk about the power of the blockchain technology with a friend, Betrand Jager. Yet our discussions remained theoretical. Theory is good, but is never enough. To truly understand a concept, one has to "touch" the things, to "get one's hands dirty". I like a lot the French expression for this: "mettre les mains dans le cambouis".
"Getting one's hands dirty / Mettre les mains dans le cambouis"
(Source: AA+W / stock.adobe.com)
The Hive torch provided an opportunity for me to invite Bertrand to do so.
Stop for a second and imagine what doing so would have implied with almost any other blockchain: basically, Bertrand would have had to open an account on an exchange with a banking relationship (when I started I opened an account on Kraken), send fiat money there, then use the exchange to acquire some crypto before being able to do anything on that blockchain.
You could say that I could have instead sent him some crypto. But that would have biased the experience and made it so much less useful. Bertrand wold have been unaware of the actual complexity a new user would face. Crypto gotten "for nothing" from me would have meant nothing to him.
And even then, he would have had to actually spend crypto (as transaction fees) to perform any operation ...
Think how unique and user-friendly steem and Hive are in that respect. Not only one can start directly interacting with other users without having to go through an exchange, but the interactions involve no transaction fees.
So I created a "claimed account" for Bertrand and sent him the keys, then we took more than an hour in Google Meet and I walked him through. And he asked some very important questions with respect to steem / hive and its underlying crypto-economics.
The first question had to do with STEEM / HIVE, SBD / HBD and SteemPower / HivePower. How are they created, how are they distributed, what purpose do they serve?
I therefore would like to take this opportunity to revisit some important concepts which are not necessarily well known or well understood by people around these blockchains.
I discussed the powerful crypto-economics of steem / hive in an article more than 2 years ago:
Since then, the "proposal fund" has been introduced next to the reward fund and the percentages between "authors" and "curators" has been revised from 75 - 25 % to 50 - 50 % to encourage people to curate. But overall, the mechanism remained the same.
The second question Bertrand asked, quite crucially at a time when the price of both steem and hive is sliding inexorably, "what drives the price of these cryptocurrencies?"
Indeed, as shown above, the fact that the "money supply", i.e. the amount of steem/hive in circulation increases continuously makes it prone to a continuous loss of unitary value in respect to "deflationary" currencies like Bitcoin. While having an inflationary currency is much better to "stimulate an economy", steem and Hive need to compensate that continuous loss of unitary value by an increase in the overall activity on the chain. In other words, the steem / hive community needs to come up with innovative services that give people reasons to buy steem / hive with their bitcoin
Currently, there are very few reasons to do that:
- The first one is the narrative of these blockchain communities, in which I still believe: I trust that at some point people around these blockchain will collectively come to implement ideas that will put these communities on a path of growth and value creation. Whoever believes in this narrative might be enticed to buy steem with bitcoin in order to profit from a future price appreciation (when the promise of growth materializes)
- The second is naturally related to the social-media / blogging applications running on top of the blockchain: the "Steemit.com" / "Hive.blog" (and the actually better "-peak-" variants: Steempeak and Peakd). In the social-media / blogging world, the main engine of economic value creation are the number and strength of relationships between members of the community. To "capture" that value, one needs to become "an influencer" and for that, one better buys steem/hive and invests in "steempower / hivepower".
- The third reason to buy steem / hive are the games built on top of the blockchain, of which most successful today is Splinterlands and most promising is probably Exode.
However these 3 main reasons do not appear to be enough to arrest the price-slide and compensate for the expansion in supply. As I said in the past, the people in the community need to come up with a lot more ideas for useful services which could lead to increasing the number of members, the number of transactions they do as well as the overall amount of hive staked as hive power.
A number of ideas that were partly tried or mentioned in the past include:
- Charity - the steem / hive blockchains are uniquely suitable to support charity because of the "return" on staked hive - an initial investment in hivepower allows one to "give" by directing funds from the reward pool, thus without losing one's initial stake. In this area we have Fundition, but I know of a few other similar initiatives.
- Markets for various "dematerialized products" such as photography and more generally art
- Decentralized storage (what Storj, Filecoin and others offer without the intrinsic advantage of the steem / hive cryptoeconomics).
More specifically, such an application could be transformed and integrated by the existing business actors in the "pre-blockchain economy" 
One can come up with other such ideas for useful products and services. Yet for the time being a strong drive to implement these has been lacking. The existing members of the community haven't yet found the magic collaboration formula. That's why increasing the number of members is pivotal.
Therefore I welcome Bertrand and hope he'll see the huge potential of this blockchain, and perhaps even bring other new members to pass the torch to.