This was suggested more than a year ago in a post by Steemitblog where they asked for user input. They then acted like they were possibly going to implement some of the suggested features...then went into maintenance mode and did almost no changes.
I think that this would increase the amount of Steem burned...but where they placed the promoted posts would have an extreme effect on that. They could include them in trending, but few even read trending anymore. They could also put promoted posts on the top of pages and interspersed in our feed. They could even put them at the bottom of posts themselves when you click into them.
They could also have promotional features for different interfaces that take a percentage and send the rest to @null.
I think it's a mistake to completely abandon all funds from advertising, burning them. Front-ends need to finance themselves. If they don't have a massive stake that they mined early on, they have to take a percentage of posts, or use advertising, or find some other way to raise funds. They could also do a hybrid model.
I think that perhaps choosing to burn part of the fund taken from users to place posts throughout the site for advertising purposes has real merit. It would help the health of the coin. Of course, only steemit can survive burning all the Steem it gets promoting posts.
If I ran a front-end, I would consider using ads, including traditional ones, as well as Steem posts. Depending on how lucrative that was, when combined with an optional percentage of posts, I would consider burning some, possibly automated by a bot, promoting posts through @null that were advertised through the site.
RE: A Simple Way to Strengthen the STEEM Economy