RE: DON'T POWER UP YOUR POSTS WHEN SBD IS WORTH MORE THAN USD!
You're making a few missteps here. First of all, it doesn't matter what the current rate of STEEM is. Right now, if you choose 50/50, you're getting half STEEM POWER, and half SBD. If this eventually changes (ie. SBD is around $1 USD again) and you're getting half STEEM instead, then there's no real "edge". Now, regarding vests, and SP, and growing, there's nothing to stop you from immediately selling those SBD on the STEEMIT market and exchanging them for STEEM (and then STEEM POWER), as I've explained in a few other comments. In fact, minnows should grow faster if you do! And I did find one example to show you the difference, as @michellectv did have two similar posts, one of which was powered up, that I could use as an example:
- 10 days ago 0.000 SBD, and 6.623 STEEM POWER for michellectv/kick-off-your-week-with-this-healthy-drink-carrot-ginger-grapefruit-juice-recipe <-- PAYOUT WAS ABOUT $16
...
steem=2.41 ... 6.623 * 2.41 = $15.96 (what we expected)
- 8 days ago 10.015 SBD, and 4.306 STEEM POWER for michellectv/super-fast-and-easy-pizza-dough-photo-how-to-and-recipe <<-- PAYOUT WAS ABOUT $20
...
let's say steem=2.41 again (may have been a bit lower though), and sbd=1.75 around that time ...
(4.306 * 2.41) + (10.015 * 1.75) = $27.91!!! (40% more!!!)
Thanks for posing the question though, as it gave me the opportunity to better clarify with an actual example!
I just re-read the above reply again and I can see that if you ignore the 1st post from 8 days ago altogether and only concentrate on the 2nd post from 10 days ago: By taking 50/50 and calculating the USD value of the total pay-out as opposed to the stated estimated pay-out of $20, you end up with about $7 to $8 more.
By listing the first post at $16, I thought you were trying to compare a $16 payout with a $20 payout and that would be like comparing apples to oranges.
I get it now. Thank-you.
I was hoping you'd go back and look again, I was running out of ideas on how to explain it better! Sort of wish you had been right, though, since that means I wasn't tossing money out the window, but glad you got it now!
Yes, Thanks again for taking the time to explain things.
I'm still not sure about the other aspect of it:
The above statement is true, but that was not my concern. My thinking was that regardless of the market value of steem, earnings will remain consistent and based on the SBD (assuming it is valued at around $1 USD).
If my assumption is correct, then when the price of Steem goes to $1,000 USD, in order to buy a single steem one would need to earn 1,000 SBD. That could take a very long time for a Minnow and even longer for a Redfish.
At today's market value, one need only earn 1.4 SBD to buy 1 Steem. Much easier to accomplish! And since Steem is what vests are based on, it is far easier to grow when Steem and SBD are close in value. This is also why I believe early adopters had the advantage in being able to purchase their Steem when it was only worth 20 cents (Getting 5 Steem for each SBD sold). Of course, this only applies if my assumption is correct in that the amount of SBD earned is constant and not related to the actual value of Steem.
nothing is constant, and even at that point (or even a month or two from now for that matter), depending on the balance of the system, you may receive your 50/50 in STEEM/STEEM POWER instead of SBD/STEEM POWER. If you're worried about some huge potential move over the next 7 days, that's a different story, otherwise just convert the SBD to STEEM on the STEEMIT market as you receive it, and you're good to go.
Hmmmm... I'm not making myself clear.
It is not the short term I'm thinking about and not even the 50/50 split (we sorted that out already). I'm just thinking about the future and what would happen if Steem takes off like Bitcoin did. Regardless of whether one takes payment in Steem or SBD, if the payout is always calculated on the SBD then I see a problem. Even if it is calculated on the US Dollar, unless the payment keeps up with the value of Steem, it becomes more and more difficult to buy Steem as its value goes up.
Like I suggested in my example:
When Steem was 20 cents, $1 USD (and supposedly 1 SBD) bought 5 Steem.
$1 USD (and supposedly 1 SBD) now buys less than 1 Steem.
When steem is worth $1,000 USD, 1 USD (and supposedly 1 SBD) will buy only 0.001 Steem.
At what point would YOU want to buy your Steem?
Now, on the other hand, if earnings were calculated and paid out based on the value of Steem, then all that doesn't matter.
As the value of Steem goes up, the earnings will rise accordingly and instead of making $10 per post one will get $100 or $1000 so that it is possible to purchase an equivalent amount of Steem with that earning.
As it is now, it takes a while to get out of Minnowship. If it becomes more difficult to purchase Steem it will only become harder to become a dolphin. Make the goal seem out of reach and watch everyone abandon hope.
I'm not concerned about how much MONEY one earns, I'm talking about how difficult it would be to become a Dolphin or Whale. Don't think of money as an asset, but simply as a means to obtain a goal. Does that make it more understandable? Am I onto something here or am I barking up the wrong tree?
Let's try this another way. Let's say it's 50/50 and you are getting 50% STEEM and 50% STEEM POWER. STEEM = $100 US each, and your post payout shows $100. You will receive 0.5 STEEM and 0.5 STEEM POWER.
Now, let's say you receive SBD instead of STEEM. You will receive $50 SBD (expected to be worth about $50 US) instead of $50 worth of STEEM (or 0.5 STEEM). HOWEVER, that SBD is worth $2 USD instead of $1 USD. So you now have $150 US worth of STEEM POWER instead of $100 US once you exchange it for STEEM and Power UP to STEEM POWER.
Yes, I get that. Forget that part.
BTW, I just used the internal market and lost approx. $2.50 as compared to if I had traded outside. I got 10.394 Steem for 15 SBD with internal market.
According to Coin Market Cap, I should have received 11.827 Steem.
19 days ago I Paid 12.159 SBD for 14.144 STEEM (note more steem than SBD).
Today I paid 15 SBD for only 10.394 Steem (note less steem than SBD).
Forget the split thing. Just look at these numbers on their own.
Coin Market Cap is a bit tricky, so it's best to go directly to an exchange. As I wrote in my latest post, poloniex does appear to be processing STEEM/SBD again, and it does seem to be offering a better rate than the internal STEEM Market. But that's a completely different question. If you find an even better exchange rate elsewhere, by all means go for it! Just remember though, poloniex has had many issues lately, and there are still additional trade fees involved. But leaving all that out, here are the numbers I got.
$15 SBD / 1.4430 (internal market) = 10.395 STEEM
poloniex
pay to exchange SBD to BTC for around 2450 currently
from BTC, buy STEEM...
15 SBD = 0.0099885 BTC
STEEM = 0.00078621 BTC * 0.0099885 BTC = 12.721 STEEM (22.4% premium!)
(less exchange fees)
So basically it's implying that SBD is trading at an even greater premium at poloniex than it is on STEEM. Just make sure the people who've had their SBD and STEEM stuck over at poloniex have finally been made whole again first before considering it though!
Thanks for the explanation and example, but I'm still having a hard time wrapping my head around those numbers.
In the 1st example, the OP earned 6.623 Steem only. Converted to USD it is $16 (roughly).
If that SAME post had earned a 50/50 mix, how would one calculate the actual reward? Would it not have been: 6.623 / 2 = 3.3115 Steem and 3.31 X 1.7 = 5.63 SBD ?
So to convert to USD: (3.31 Steem X 2.41) + (5.63 SBD X 1.7) = 7.98+9.57 = 17.55 which is just slightly more. I don't see how one can compare 2 completely different rewards without knowing how the rewards were calculated in the first place.
The one and only time I ever converted SBD to steem, I got roughly 14 Steem for my 12 SBD. When I now look at the conversion rate, I'm getting Less Steem for my SBD, so I have not converted any since then. All these fluctuations make it difficult to know what to do when.
The point is that in the post payout calculation, the blockchain does not consider the current price of STEEM DOLLARS. It assumes 1 SBD is always about equal to 1 USD, and issues an amount of SBD based on that.
Regarding the amount of STEEM you receive, when STEEM was worth 10 cents in SBD, 1 SBD = 10 STEEM. Currently, on the STEEM Market, 1 SBD = 1.41 STEEM. Meanwhile, coinmarketcap currently shows 1 STEEM = $2.16 USD.
And, if the blockchain's giving you more SBD than it realizes it's worth, that's where the extra STEEM comes from. But of course, if you're converting with STEEM over $2 USD versus when it was a much lower price, that's likely why you feel you're getting less STEEM for your SBD.
At the time I converted, SBD was close to $2 USD and Steem was just above $2 USD. The spread is slightly greater now, but that shouldn't reverse the rates. This is what is totally confusing to me. It was only a week ago or so that I made the conversion.
And that is why I believe that if the price of STEEM goes up, earnings in SBD will be worth less and less as far as converting them to Steem and earning vests (unless the amount of SBD earned keeps up with the value of Steem).