Hi, I have a question about the melee-talent “Blood on Steel”. Why does this exist, is it just because it was needed as a prerequisite for “Killing Strike”?
Because, its effect is practically the same as spending 1 Momentum for an additional point of stress, it just makes a detour using the Vicious1-quality (which also adds 1 stress [after successfully causing stress in the first place AND rolling an effect on the damage dice]) and costs 1 Momentum to activate as well.
So, I think this talent is really not needed and should be reworked to do something different. 
I believe that you have misread the vicious quality. Many numerical qualities like vicious inflict their effect per effect rolled. Cavalry, unforgiving, backlash, piercing, and fearsome are other examples.
Vicious: “An attack with this Quality inflicts X additional damage for each Effect rolled.”
I am also unaware of any requirement that momentum be spent to activate effects.
Werlynn is correct. The Talent does not require the use of Momentum to engage. Any weapon used by this character gains the Vicious 1 quality (or increases the Vicious quality by 1 if it already has it) and that results in extra stress damage per effect rolled.
The Hyperborian in my group rolls an average 7 combat dice per attack, and with No Mercy can reroll 3 of those. He routinely gets 3 effects per attack. As he uses a weapon that already has the Vicious 1 quality, Blood on Steel makes that Vicious 2. With 3 effects rolled, that means 6 extra points of stress. That’s probably two dead minions, struck down by a vicious blow of the barbarians merciless axe.
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The talent does require 1 momentum.
…you may spend one Momentum in order to…
But in general in Conan 2d20 effects don’t require momentum to activate. You roll an effect and all effect-based qualities activate. After I read the original post I searched the PDF for the word effect to find any reference to spending momentum to activate them. That might be something from another version of the 2d20 system.
My assassin used a talent to turn all 7 damage dice of an exploited garrote attack (unforgiving 3, grapple, piercing 2) into effects resulting in a 28 vigor, 14 piecing attack with a grapple of 5 difficulty to escape (because the difficulty can’t be 7 due to the cap).
Thanks for the clarification 
Right you are. Always pays to read the text instead of working from memory.
As you can see from the examples it can make a huge difference in damage. A lot more swing in damage range. That’s how you butcher a load of minions. Get your brawn 14 brute to pick up a two handed sword, blood on steel, and anatomist so they can spend 1 momentum to roll 10 dice of damage with vicious 3. 