Well, if you re-read my first reply in this chat, where I tried to “organize” this chat, you will see that I came up with the (expanded) goal of this chat (more than new user incentives, but also focus on incentives/rewards to keep users on board, and use the platform). I also started a form of classification in sub groups with new starting ideas in each group (as later incorporated and adjusted a little by XRPRE based on the discussion in this chat). My initial chat was primarily focused on the role of the PRE token (before emphasizing the importance of the benefits/features of the platform, and marketing)…
So, we agree about the importance of marketing and unique USPs that can be “reasons” for potential users to use the Presearch search platform (as privacy, no-tracking of search data).
But besides great features/benefits… we are talking about incentives and rewards… additional things the team can do to stimulate potential users to try out the platform and keep using it (and use in the marketing to convince potential users to try out the platform).
So far, the team used 2 incentive “methods”, PRE search rewards and the “bonus” of 25 PRE for the new user and the affiliate.
The 3 big disadvantages for users/referrers who earned PRE?
A) The 1,000 PRE threshold, where it takes the average user 1,950 days to achieve this threshold.
B) The fluctuating PRE token price… the lower the token price, the less interesting the rewards.
C) Lack of PRE usages… It takes a lot of efforts and costs to switch PRE for “cash”, and users can’t “consume” their earned PRE. They can only stake PRE to run a node, or stake keywords. Both activities where the average regular user has no interest in.
For the project, the 2 main disadvantages are:
- Token farmers, and additional management time and costs to fight them.
- Effects of lower Threshold. It will lead to a fleet of PRE withdrawals of (millions of) already earned PRE rewards.
So, that’s why we should look at all aspects as mentioned in the different sub groups to make the current incentives/rewards, PRE ecosystem, and affiliate marketing system more interesting.
I’m glad you like my ideas as classified under B/C, and do want to discuss these ideas.
I also understand that you like the new Search Staking concept…
So, let’s dive into the known concept details…
Now, primarily to stop token farming… we will introduce Search Staking, and cut down the rewards for non-stakers with 90% (from 0.1 PRE to 0.01 PRE per search).
Or to say it other words… the new Search staking PRE rewards are paid with this 90% cut.
The underlying idea is that farmers won’t spent their own money to buy PRE on the open market and put it “at risk” as the token price may decline.
But do we expect that current regular searchers will make the switch?
They also have to buy the PRE on the open market (very annoying and relatively costly process), transfer the PRE to their balance on the platform and stake them, and put these at risk.
(And yes, I know with the upcoming Cosmo chain, and new marketplaces, it will easier and less costly, but what comes first, the new Search Staking or the new chain?)
Looking at the numbers…
As almost all token farmers were “cleaned up”, we may conclude that with 100K PRE daily search rewards, 1 million searches, and average of 5 searches, about 200,000 regular users will get 0.5 PRE per day on average.
Now, we can ignore this (huge) group of early adapters who tested the current platform, and may think that we solve the token farming problem…
But I expect that the majority won’t like the 90% cut, with as result “unhappy” users with thousands of complaints on social media.
For the majority, they just see a 90% cut and “uninteresting” Search Staking alternative.
The new 0.01 PRE per search is so demotivating… and it also effect the affiliate program, and onboarding of new users…
as it will be even harder to “cash” the 25 PRE referral reward as the threshold of 1,000 won’t be achieved as “easy” as before.
Plus, where is the incentive to onboard new users, if these 25 bonus PRE for new users are “worthless”, and new users have to first buy PRE on the open market and stake them to get “any serious” rewards?
The risk of losing money by investing in PRE is probably the main reason why the majority of new users won’t buy and stake PRE… not because they choose the platform for privacy reasons above “rewards” reasons.
If you make the rewards attractive enough, it will help to convince (a huge group of potential new) users to try the platform and keep using it.
For marketing reasons, it’s so much easier to promote “Search and earn PRE” in comparison to “Stake, Search, and earn PRE”.
Plus, new users will look at the potential benefits of “earning and saving” PRE. After the 90% cut… the rewards are just so ridiculous low…
Now, we don’t know all details but let’s assume that the Search Staking will be set up like the current node staking.
So, the rewards are calculated based on 2 measurements:
A) Time-based staking based on the number of PRE staked with a decreasing scale. The more PRE staked, always the higher the rewards, but relatively lower rewards. So, for example, for 1K PRE staked you may earn 1 PRE per day, while for a 2K stake, you will get 1.5 PRE… for 3K stake, 1,75 PRE, etc.
B) A small number of PRE for each actual search, with 25 searches per day maximum.
And let’s assume that users can immediately claim, withdraw (24 hours waiting period), or re-stake the PRE rewards, just like as now with the nodes.
Now, I immediately see 3 potential problems…
- What to do with the already earned PRE (below threshold)?
These are still “locked up”.
Should this user be allowed to withdraw if the total sum of “old” earnings and “new” earnings will reach the threshold?
And if so… this should be built into the new system.
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As users are still stimulated to search to earn more PRE… there will always be some users who do “fake” searches just to earn more PRE.
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As the time-based rewards will (probably) based on a decreasing scale… it’s more beneficial to stake 1K PRE in multiple wallets/accounts. For the nodes this is less of a potential problem as it requires to set up a new node, but it’s relatively easy (with neglecting costs) to setup multiple accounts/wallets.
So, the new system still needs “checks and reviews” to fight “misuse” of token farming and creating multiple accounts. For both the old and new system.
Hence, overall… maybe we are throwing the baby out with the bad water… with this replacement of the current system with a 90% cut of rewards and new Search Staking system.
For me, there is no need to rush this new Search Staking.
So, I hope that Tim Enneking will start to join this discussion as I see several “unwanted” possible consequences.