Ask Steemit: When are you planning to Power Down? Why?
I'm still trying to wrap my head around when people power down and why. The incentives of Steem are such that it's generally better to keep tokens in Steem Power and not Steem. How are you managing your Steem Power?
I actually started a power down a week ago. I got my first payout from it yesterday. As far as I can tell it only powers down what SP you had at that time, but it continues to accrue interest as it's doing so. I'm actually generating more SP in interest than it's paying per week, so I'll be staying on top of the payouts at least.
I basically did it because money is kind of tight for my family and the weekly payout helps take care of the bills. It's actually going to enable us to pay of the remainder of my twelve year old school loan within the next couple of months!
Very interesting that you can earn more interest in SP than you convert on a weekly basis from a Power Down. I just looked at this post by @craig-grant in which he is saying the same: https://steemit.com/steem/@craig-grant/my-steem-power-down-payment-is-infinite.
Yeah, I thought is was a pretty interesting and welcomed surprise.
Good to know. I'm finding that with the large fluctuations in Steem price, it's difficult to plan ahead. I didn't realize that the interest was more than the weekly power down.
I was originally frustrated I'd have to wait two whole years to get all of the steem powered down and paid out, but considering the way the price jumped yesterday I'm actually glad it's going to space it out. I'm not very patient and I've already missed out on a couple thousand USD worth of exchange rate changes so having to wait each week for a portion of the total works in my favor.
Sorry to reply again, but I somehow missed your comment about " I didn't realize that the interest was more than the weekly power down." This is the case for me because of how much SP I have, it may not be the case for all people who hit a power down. I'm sure there's a magic number that keeps you more profitable than the power down, but I'm too lazy to do the math right now, sorry.
This is a question I've had on my mind since I've joined Steemit. I also wonder what happens when many people Power Down. Would that not flood the market with more Steems? What impact will that have on the price of Steem? Nonetheless, my strategy has been to keep approximately 20% in Steem and 80% in Steem Power.
The inflation of Steem is the real reason why keeping tokens as Steem Power is useful. That said, Steem Power takes 2 years to power down, so it's not nearly as liquid. @dantheman has definitely set up the correct incentives since Steem Power helps you upvote stuff.
Also, I'd be lying if I sad that I understood how things Power Down. There's some Steem Power to Steem conversion rate which I still don't get, which has incentives as far as how much people keep in Steem Power vs Steem. Anyone know?