Hey everyone, Satoshi here. I thought it would be a good idea to do a post about the current model and use cases for SCR tokens and SP. This particular model is subject to revision and it will most likely change as Scorum develops, but at this time, this is how I understand it.
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The Scorum token economy is modeled much like a “hub-and-spoke” model. At the center, the hub, is the Scorum user. Extending from the center are the spokes, which provide the use cases for SCR tokens, fiat, and SP.
Scorum builds the tools and the platform for the Scorum community, which in turn is used by the individual Scorum user. At the center of the economy is the Scorum user where they can vote, comment, and post.
Roles of the Ecosystem
Scorum
The role of Scorum in this ecosystem is to create, maintain, and further develop the platform. They code everything, they pay for hosting costs, they implement new features for Scorum users to use and they also attract new users to the platform.
In many ways, they also regulate the platform. For example, they inject additional SCR and SP into the ecosystem and they implement certain changes that influence the economy (e.g. - disabling self-votes on comments). This is not confirmed, but I also imagine certain accounts like @balancer are run by Scorum in order to prevent excessive payouts on posts/comments.
Scorum Community
While Scorum builds a platform, the Scorum community uses the platform. They post articles, make comments, and vote on them. The Scorum Community as a whole also participates in fantasy sports, sports betting, and token trading and liquidation on exchanges.
On a macro level, the Scorum Community facilitates the move of SCR and SP. We do this by using the SCR asset and providing liquidity, moving the currency in and out of the ecosystem.
In essence, the Scorum economy is a democracy, except not everyone’s vote is equal. Your vote is proportional to the amount of SP that you have. While this apparent income inequality may be a problem later on, ( with a small percentage of users holding most of the SP) I think at this time, Scorum is taking the steps to keep the economy and SP distribution somewhat in check.
It is worth noting that some people see Scorum and indeed the whole blockchain space as a kind of new economic model and by the nature of it being new and innovative, it brings with it new and unforeseen challenges and issues.
Because of this, the Scorum Community also self-regulates in some ways. For example, the issue of self-voting has been brought up and whether that is okay or not on the platform. Some think it is okay, others think it is not. Another issue that the community is involved in regulating is the plagiarism of certain articles. In any case, with these issues (amongst others) it is up to the community to figure out what is acceptable over time.
Scorum User
I separated the Scorum User from the Scorum Community simply because of one very clear fact. Despite having many things you can do on the site - posting, voting, commenting, betting, buying/selling, there is only one thing that a Scorum user needs to do to in order to participate in the economy and that is - to vote.
When I thought about this, I thought I might call this “Proof of Participation”, but a more appropriate classification is actually Proof of Voting. That is because voting is the bare minimum a user has to do in order to contribute to the Scorum ecosystem.
You don’t have to invest any money onto the platform. If you sign up right now, you will get 5 SP to start. You are not obligated to post articles, and if you did, there is no guarantee that people would vote for it. The same goes for comments.
The bare minimum then, is to vote. If you vote, you inject SP into the ecosystem. By doing this, it decreases the amount of SCR in the economy and it increases the amount of SP. The mere act of voting moves the economy and facilitates the flow of SCR and SP.
What gives SCR & SP value?
SCR will most likely be classified as a utility token, rather than a security token. The reason is that a utility token is not necessarily defined as an investment vehicle and instead represents a use case within a defined ecosystem. In this case, that is the Scorum ecosystem. Utility tokens may increase in value depending on the demand for them over time. The value of SCR comes from the different ways you can use the token, (which will be described in the next section) as well as from the community that uses it.
SP, while not technically a token because it can’t be traded/bought/sold can be called a “utility asset”. It is indirectly tied to SCR because it can be converted into SCR. SP’s value depends on the network of individuals that uses it, namely the Scorum Community and the articles and comments that they make and vote upon. In diagram 2, it is in the investment quadrant because it takes 12 months to convert into SCR, so by converting SCR to SP, that represents an intention to keep it as SP for a period of time and to vote to contribute SP back into the Scorum economy.
Markets move in cycles. Right now, if it wasn’t obvious, is the time to accumulate SP. The overall economy is movement of SCR towards SP. SCR has limited uses at this point. That is to say, liquidating SCR is hard to come by right now. Exchanges that trade SCR have very limited volume. When betting is implemented and fantasy sports are in full-swing, expect more conversions from SP to SCR. At that point, the overall movement will probably be from SP to SCR.
What can you do with SCR tokens?
As of right now, the proposed use cases for SCR tokens are as follows:
- Advertisements - the Scorum user will be able to pay Scorum with SCR to advertise their posts on the Scorum platform.
- Store - Scorum will form partnerships and offer real-world assets like tickets, sports merchandise and paraphernalia that will be available to purchase with SCR.
- Sports Betting - Feeless and commission-less betting
- Fantasy Sports - Feeless and commission-less fantasy sports
- Fiat Gateway - You will be able to buy SCR on the Scorum website.
- Crypto Exchange - SCR/BTC SCR/ETH SCR/BTS trading pairs exist for you to sell and buy your SCR
These six use cases are split into 3 categories, 1.Revenue generation for Scorum, 2. Gaming & Betting, 3. Currency Exchange.
Revenue Generation for Scorum
Advertisements, the photo database, and the Scorum store, will all provide sources of revenue generation for the Scorum developers. They will use this revenue for profit for themselves as well as to develop and maintain the Scorum platform for the community.
Scorum users will be able to use SCR to pay for advertisements (pay per click) of the articles that they post.
Scorum will develop partnerships in order to sell sports merchandise/tickets/viewing events which will be available for purchase with SCR and other currencies.
The photo database will be available for Scorum users to use to supplement their articles. Whenever photos are used, payouts will be distributed between the photographer and Scorum.
Gaming & Betting
Both fantasy sports and betting will be commision-free. As a result, these two use cases will not be sources of revenue for Scorum and in turn will be entities that provide value directly to the users who participate and win.
This is a very important point here. Scorum simply built these into the platform for us to use, to bet our SCR, and to hopefully win. By their nature of being commission-less and with no extra fees, this should prove very attractive to individuals who participate in fantasy sports and betting on other platforms that have these fees.
Currency Exchange
SCR will be able to be purchased on the Scorum website and as of this writing, SCR is trading on several exchanges like openledger (https://openledger.io). However, volume on these exchanges are still limited at this point. (On open ledger, daily volume is a few thousand SCR)
When more users join Scorum and the betting is implemented, expect more volume on these exchanges as people try to cash out their winnings and SCR converted from SP.
Final Thoughts
A lot of the use cases for SCR has not yet been implemented and that’s okay. Scorum is still very young, but if you are reading this and believe in Scorum’s future, then I would encourage you to use the platform and at the very least - vote. Vote for good content and good comments.
The success of Scorum hinges upon its future as a social networking and sharing platform. It’s entirely dependent on the community creating and moving the market. The network of users voting, posting, and commenting is for generating and transferring SP /SCR and that is what gives the Scorum platform its value.
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