Why I am closing my Steemit account and why I am a bear on EOS


TL:DR. Steemit feels like a cross between a popularity contest and a work from home hustle. And the EOS ICO turned me into a bear on Dan Larimer who is also the man behind the curtain for Steemit (and EOS and Bitshares).

Clearly I  don’t expect this post will get a good reaction from Steemit fans! That is part of the point. Media should be independent. A post on Steemit slamming EOS is probably not a good way to earn Steem.

This was an experiment that had reached a natural conclusion for me. Steemit enthusiasts will tell me I should persevere, but there are only so many hours in a day. 

There was a lot to like about Steemit. The idea of a social network where content creators get paid by other content creators is appealing. 

Right objective, wrong implementation.

I can see how to make Steemit work as a creator. It is similar to points systems on venues such as Hacker News and Reddit. That is what makes it a popularity contest. If you write something that the top influencers like, you collect Steem. That feels like a PR game of “you scratch my back, I will scratch your’s”. Yes that is similar to the “if you follow me, I will follow you game on Twitter” which I don’t do either.

The Internet has been brilliant at enabling everybody to write as well as read. It has been less good at providing an income for creators. For a long time, Advertising was the answer, but with ad fatigue and adblockers that model is challenged. However Steemit does not look like the answer either – which is the subject of today’s post.

The blockchain part of the Steemit story seems like contrived PR – a bit of a random buzzword generator. You don’t need blockchain to rate content – hello Reddit, Hacker News and Fintech Genome. Nor do you need blockchain to pay content creators – hello Patreon. 

The blockchain part of the Steemit story seems to be designed to sell a narrative that EOS is the Ethereum killer platform. I do not buy this story either. The technology advantage is totally unclear. I can see a pitch that you can program Smart Contracts in any language not just Solidity, but no clue how they will do this, let alone a MVP.  There are lots of blogs and vlogs along the lines of “I don’t understand the technology but Dan Larimer is a genius so I am sure it will be an Ethereum killer”. Steemit is proof that Dan Larimer is a genius and thus why investing in EOS is a winner. Does that translate to “I bought some EOS coins and I hope somebody will buy them for a good price”? The pitch is a bit like for a super expensive car – “if you have to ask the price, you cannot afford it”. In this case “if you have to ask what the technology advantage is, you are probably too technically illiterate to understand it”.  Who knows, but without a convincing technical explanation of why EOS is better than Ethereum, one should note that the EOS ICO is done using….Ethereum. 

I onboarded onto Steemit using standard two factor authentication. Then I was told that my application was “awaiting approval”. I was not the first to find this seemingly manual process step strange, but I was approved after a few hours. So I will probably remain as a statistic around “inactive registered users” along with all the other social networks where one is inactive.

This apparently manual process step was a red flag for me.

What happens if I recommend Steemit to someone and they cannot sign up? I think there are better ways to trap spam accounts. Maybe this is a pragmatic entrepreneurial “do things that don’t scale” that is life-stage appropriate, or maybe not. I don’t know but it is a red flag. 

Steve Jobs managed two companies successfully. Dan Larimer is managing 3 – Bitshares, Steemit and EOS – and I doubt he is in Steve Job’s class as an entrepreneur. No professional investor would back an unproven entrepreneur with three parallel ventures. Is the crowd being smart or dumb?

I imagine that Dan Larimer is brilliant, probably a visionary who is far ahead of his time. Some of his experiments may appear as a footnote in history along the lines of “back in 2017 there was an attempt at a similar idea that failed…”. I like experiments, I just choose not to be part of this experiment by donating either my time or my money.

Image Source.

Bernard Lunn is a Fintech deal-maker, author, investor and thought-leader.

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  1. Your commentary on Larimer falls just shy of being insightful, but when you detail your frustrations with the ICO as though they are a matter of fact (ie “one should note that the EOS ICO is done using….Ethereum”), it makes you seem uninformed. EOS can be exchanged for any currency using shapeshift and it’s currently trades on exchanges, simultaneously while the token sale is running. In your defense, you wrote this in August, and as we all know much has changed since then within the crypto ecosystem as a whole. I am curious to know what you think about Larimer and EOS now, considering how many technical setbacks Ehtereum has had since then (revealing needed improvements that it’s too set in its ways to resolve), considering how successful bitshares and open exchanges have been, and of course the “New” and improved steemit and its growing prominence within crypto media and blockchain innovation news.

    • Thanks Simon, yes a few months is a long time in crypto land. I certainly see the security attack vector issues with Ethereum. I am not convinced EOS has a better solution. Any insights on that. I believe they launched using Ethereum and then converted using Shapeshift. Is that right?

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